Monday, November 27, 2006

Startup Sales Incentive Plans

I spoke at a local session for entrepreneurs last week, alongside a sales performance consultant. I found his insights fascinating, particularly his observation that, in many high growth companies, the sales force does not always have an accurate understanding of their sales incentive plan or the metrics by which their company measures sales performance.

This surprised me. My experience has been that the sales incentive plan is the ONLY document that sales people pay any attention to. It is studied and marked like a bookie's sheet. The rest of their employment documents - policies, option plans - are regarded as just so much paper from HR (or, as one of my sales clients calls them, the "Human Remains" group).

I had never thought about the importance of sales training or sales coaching before (I always assumed that software sales guys sort of sprang abundantly coiffed from their mother's wombs, ready to close the quarter), but now I'm a believer. Sourcing prospects, qualifying potential customers, shepherding them through the process and managing their account are things that can vary in some fundamental ways from company to company, depending on stage of growth. Company-specific training makes sense to me.

A Sales VP once tried to sell me (and the rest of theboard of directors) on a sales forecast built on a pipeline of "qualified" prospects. When we questioned him further, it turned out that he'd built his list of prospects from the business cards some trade show attendees had submitted for a prize draw. Now, I may only be a lawyer, but even I know that "I want to win a free tee shirt" is not the same as "I would like to buy a service provisioning tool, and some support and maintenance sometime within the next quarter."

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