There is probably no single more hated task of a sales manager than the performance review. It often seems like an exercise in futility. For the sales people who are doing well and hitting quota, it seems like a huge waste of time to do a detailed performance analysis, when a pat on the back would suffice. For the folks that are under performing the performance review is really just an execution order in disguise, as it is used to ensure that the employee file has been given enough of a chance to "improve" to meet the employment regulations of the jurisdiction where the company operates before they get the axe.

The reason why these reviews are so challenging is, tied to the view that sales achievement is pretty self evident. If you are hitting quota all is good, if not get there fast. The problem is that one of the primary purposes of a review is to assess multiple variables, such as activity, skill, knowledge, etc. Quota achievement though useful as an output doesn't really help you determine if the person is truly skillful or just plain lucky.

I have spoken in a previous post about building a set of performance metrics that are tied to leading indicators, the natural by-product of having those indicators is a performance schema that incorporates those indicators as well. So how should one structure the reviews with sales people to try to get to root causes, and hopefully influence behavior?

1. Take the key performance indicators that you know predict quota achievement and measure them consistently over the course of the review period. Ensure that you communicate with the reps that you are doing this and that execution on these variables will have impacts on their reviews.

2. Account for quota achievement but in a weighted fashion. Quota achievement should amount for a percentage of the review not all of it. This will ensure that proper territory development will occur and you don't have sales people swooping in skimming business and quiting to find a new job, (or at the very least you will be able to identify those folks early-as they wont execute on the KPI's).

3. Identify what the key competencies are for the role and set a relative weighting. Focus on things that have a longer term view as opposed to monthly quota achievements. The Quota metric will take care of this for you.  The competencies should be tied to strategic objectives for the company, territory, or product line. This will ensure that your reps are building the business for the long term.

The goals of your review process are not just to evaluate the capabilities of your reps, provide constructive feedback and growth, its also to gain visibility to the development of the territory/product/etc. Having a karmic review process, defined as a sales process and review process that is clear about its objectives, will gain you satisfied high performing sales people that is sustainable.

Moment of Zen
"If one has faith one has everything." -Swami Ramakrishna Parmahamsa

P.S. If you are interested in leveraging the karmic philosophy to accelerate your career or business please check out my website http://www.karmiccoach.com , and get Karma working for you!