You might feel however that we need measures such as those 1,712 years ago (more of that later)
|A new city landmark|
By imposing a ratio between salary and bonus, EU lawmakers may force bank to increase base salaries - an unintended consequence.
all thought sub-prime were fine, CDOs were fine and very low levels of capital were fine.
That having been said setting sales targets and incentives for your salespeople is an important area of any business whether it high finance , a bank , an estate agent or a shop.
Sales managers need to set clear targets for their salespeople, linked to incentives such as commissions and bonuses - this motivates them and provides a clear indication of the kind of performance expected of them.
This process is crucial to the success of their business and needs to be closely tied in with the rest of their company’s business strategy and planning.
Being specific when setting targets for sales staff – typically they break their business generation requirements down into three different areas, for example:
• Developing New Business from Prospects - working from the projections in the business plan and sales forecasts - these will take into account changing market and economic conditions.
• Renewals and Growth from Existing Clients – protecting and expanding existing customers.
A typical renewals rate is in the region of 60 to 70 % according to Business Link July 2011.
• Lapsed customers - a good salesperson should be able to recover some of the company’s past customers who have not bought for some time.
Looking at the business and identifying the factors driving its profitability – Sales managers use these to drive their sales targets as well through tactics of up selling and cross selling.
Different businesses may require very different targets
Sales managers have to balance between making sure that the targets set for their new sales staff are reasonable for the territory they've been allocated, to making things too easy which may lead to complacency and lost sales, while making them too difficult can be demotivating and lead to lost sales.
Setting activity targets for your salespeople
As well as setting salespeople targets for the number of sales they want them to make, you should also set them activity targets. These include all the individual aspects of their day-to-day duties that their sales team will carry out as part of their jobs - and which should lead to sales.
Activity targets might be ( often included as part of their CRM system):
• Completed phone calls - asking sales staff to record the number of calls they make that are completed with potential customers.
• Face-to-face meetings - getting salespeople to record the number of appointments they make with customers where they attempt a sale.
• Leads generated - measuring how effective your staff are at extracting new leads and generating potential new contacts.
• Leads followed up - see how successful and fast your sales staff are at following up sales enquiries generated by your marketing activity.
• Qualified prospects - ask sales staff to let you have the qualified prospects that they have identified. These are people who have been picked out as needing the products or services that you offer and who are able to purchase, but who haven't approached you - or been approached.
This is an important area of the sales process, as continual efforts by the team to to generate new business leads may help keep sales figures steady or on the increase.
Sales managers would do well to monitor this area of their work just as closely as the actual sales figures.
The approach to setting targets by the sales manager respondents to the Business Link survey showed the majority 53% ( sms 52.7% ) choose to set very clear targets for their team members but leave them to organise how each team member achieves them.
A further 33% (sms 32.7%) let their sales people set their own targets and work with them to discuss how they will achieve them and whether they should be changed.
13% (12.7% sms) set targets within a higher/lower range and leave the individual to determine what and how they achieve them
. Only 1.8% let their salespeople set their own targets and achieve them in their own way.
Of course you might preer the capping of bonuses like the EU have suggested last week
‘..Possibly the most deluded measure to come from Europe since Diocletian tried to fix the price of groceries across the Roman Empire.’
I reckon Diocletian might have felt threatened by Stuart Gulliver's HSBC empire though perhaps Brussels does as well.
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