Goal Setting - Make It a Winning Proposition

Picture this - You lead a relatively new sales team for a Multinational. Budgets are frozen at the Regional Headquarters and it trickles down to you. Your organization's fiscal quarters do not map one to one with the country's financial setup: however Quarterly linearity is globally decided at HQ. Sales teams carry a significant variable component in their compensation plan and are expected to maturely plan their sales achievement to maximize salary. And yet, cannot forecast below quarterly budget. Sounds familiar? If you are a new manager, how do you manage goal setting in such an environment?

Welcome to the real world of negotiation - executed with one limb tethered to the management pole and the other swaying to head winds of employee motivation, retention, volition and satisfaction. If there is anything called elasticity of balance, this is it - a single degree of freedom for one hand (or half is it,
since it only moves upwards?) and unlimited for the other.

Here is where your leadership matters the most - Whether you are Participative, Authoritative or Delegative, the quota setting time for sales reps will seriously test your ability to carry your team along. If you are the kind who will lose sleep over employee happiness, here are 5 steps that you could do to manage this process smoothly:

1. Get sales buy-in early on in the year reinforcing expected growth rates for the coming year and set a target for a rolling pipeline. Growth rates need to be dependent on a mix of several macro-economic parameters viz, GDP growth, sectoral investment, market maturity etc and not just visible pipe.

2. Get your market information correct. Present to the management your closest take on the competitor sales figures and sales teams, market size (from estimated primary and secondary sources), SWOT data, historical analysis of average deal size and what is required to increase quarterly transaction volumes etc and thereby work out the most appropriate growth. You may still be cajoled into accepting a higher budget, but at least you made an effort towards a realistic forecast.

3. Fit to a curve. Avoid applying uniform growth rates to all reps in the team. Your star performers will be more than willing to take on a higher growth. If your organization permits flexibility in the variable pay mix, offer to increase the accelerator earnings for higher performance.

4. Weed out the suckers. Howsoever lucky you may be, there will always be noisy cribbers in the team that won't align with your reason. Assist them this year with a possible re-alignment of territory, sectors or products. If the situation persists next year, get them out-placed. If you possess even one star performer in your team, it is absolutely imperative to continuously churn out the low energy reps - that is the only way to build an all-star team that will give more than expected growth year after year.