Like buying a house or choosing a partner, setting sales goals should never be an arbitrary process. Instead, it should require careful planning and discussion to find a healthy balance between the needs of the organization and the objectives of the person actually selling the product. That’s how meaningful and realistic sales goals can be created and how success can be achieved across the entire organization. Now who doesn’t want that?
In this week’s Conversations from the Corner Office, we’re talking to sales guru and ID Plans CRO Seth Garber about setting meaningful and realistic sales goals. How do you do it? Why should you do it? And how can you ensure your sales team will buy in? We cover it all in our Q and A.
SG: In sales, there’s a concept that goals are set and people blindly accept those goals, and that they’re driven solely by the revenue needs of the business. However, I think the top five percent of salespeople really understand what goal setting is about. They understand that there’s a difference between setting goals versus just talking about setting goals. These are the people who, when they set goals, are laser focused on hitting those goals come hell or high water.
SG: We run the SMART methodology. That breaks down to Specific, Measurable, Achievable, Realistic, and Time-based. These are all important factors to take into account and they’re always on my mind when we set any type of goal.
SG: From a high level, there are two fundamental ways I like to think about goal setting.
First, there’s what I’ll call the trickle-down effect. A growth company has a current revenue number they’re at and a projected growth rate. Let’s say it’s plus-30 percent, meaning “we want to grow more than 30 percent each year.” It’s an achievable goal. So we start there, and then we go through different departments and determine how we can hit that goal. That’s not just sales, but also marketing, client success, and anyone else who can impact our revenue. This is also where we determine how many people we need to accomplish our goals, and that might mean bringing in more salespeople, adding additional marketing team members, etc. There are lots of nuances involved in getting the numbers and quotas nailed down, but at the end of the day, it’s all tied to what the company’s expected growth rate will be.
SG: You can look at it the opposite way – bottom up versus top down. This is a new way to do it and something I’m really interested in. In this new methodology, the sales organization sets their own goals and they roll up to top leadership to estimate the organization’s growth rate. This typically works best when you have a team of motivated, longtime salespeople who understand their pipeline and their prospects and can use that information to set goals. They even set their comp plans based on achieving those goals. It’s a pretty complex methodology, and very interesting to think about.
SG: Overall, I think setting goals is about owning the goal and focusing on accomplishing it. For some people, it’s their number-one objective. For others, they think “it’s OK to almost get there.” There’s really no right or wrong here – it’s all up to the individual.
SG: I have a personal struggle with this. I look at the outcome of goal setting as success or failure. It’s black and white versus gray. If I miss a goal, which can happen, it’s something I think about all the time. I lose sleep over it. That’s how my personal engine works. I fully understand that this mindset isn’t for everyone. As a leader, you have to accept the goals of your team members and learn how to drive them toward success. You have to manage the gray area and understand the human connection.
SG: I encourage my teams, when they set goals, they should keep them in front of them everywhere. In their car, at home, in their office. They should talk about them often, and not just in the last week of the quarter when it’s crunch time. They can also think about the “subtraction effect” – how much further do you have to get to reach your quota or goal? That can help people visualize and plan ahead.
SG: Ideally, we work to get them to the place where they hit quota retirement. In other words, their quota no longer exists because they’ve hit it. How do we get there? I look at it by trying to understand our individual team members’ ideal compensation. If I know what they want – and most of them are driven to close deals and make money – I can help guide and motivate them to make their goals, and then some.
SG: Sure. For some, motivation might be tied to hitting a compensation goal. Others may be motivated by a specific item they want to buy. For example, they’re saving to buy a house. Keep that in front of them to keep them on track. Once I understand someone’s personal goals, it allows me as a sales leader to connect with them on a personal level. I encourage my team members to talk with me about their personal scenarios. Sometimes I’ll hear them tell me that they want to work on their spending habits. This is an opportunity for me to lead and coach them in both business and in life, and to set them up for success in meeting and exceeding their goals. [Click here for more tips on how to stay motivated]
SG: For someone who is driven by things, the concept of vision boards is a great one. Compensation-minded people might want to look solely at numbers. Those who are motivated by putting in extra hours to have more time off to spend with loved ones might want to have images of vacation destinations or family photos around. Then there are others who are motivated by competition. Here at ID Plans, we write our sales goals on a glass office window so people can track their progress and also see how they’re stacking up against one another. This is also a great way to promote transparency.
By the way, if you’re interested in learning more about building transparency in your organization, check out the book The Great Game of Business. It’s super interesting and supports what we’re doing here at ID Plans.
SG: They have to first be honest with themselves about what their true motivators are. There is no right or wrong answer – only the one that is true for them. One of the things I work on with our team is creating a complete open level of transparency. I support anyone telling me anything related to business that they want. They can tell me I’m wasting time, that I’m not being a good leader, that I’m not committed enough, anything that is on their mind. This allows me to better understand their mindset and their goals. It’s this honesty component that drives the concept of servant leadership when it comes to goal setting. If you’re strong enough as a leader, you allow it because it allows you to be transparent and open to your team members as well. When everyone is working together and honest about where they want to go, great things can happen and goals can be achieved. It’s an awesome thing to see.
Whatever goals you’ve set for yourself and your organization, ID Plans is here to support you 100 percent. Click here to schedule a demo of our game-changing property management and leasing software.