Sales management has a basic choice when it comes to the development of its sales force: to focus efforts on the low, average, or top performers. If you examine the majority of sales organizations, you’ll find that:

• Companies gear the training budget toward the new and average performers with a focus on “blocking and tackling” skills.
• Sales management’s one-on-one coaching efforts are almost entirely dedicated to the low-performing, problem children--those who are a long way from quota.
• Companies leave the stars alone. (Hey, they’re doing great, so why bother?)

To sum it up, companies focus most of their efforts on the low performers, target most resources (training) to average performers, and target little, if anything, to the old pros.

The logic seems reasonable, yet this is a formula for mediocrity. In this scenario, resources reinforce “average” performance. No organization can make dramatic strides by focusing on the status quo. The results prove this. How many services organizations routinely increase revenues over 10 percent per year?

Here’s an alternative that I strongly believe has an immediate and profound effect. In fact, for organizations under the above regime that commit to the steps outlined here, the sales productivity of your services organization should improve 25 percent or more within one year.

Over 30 years ago, one of the founders of the field of performance technology, Thomas Gilbert, came up with the simple yet powerful formula for computing a function’s performance improvement potential (PIP).¹ He stated that his usual finding in working with organizations of all types was that the sales function was the area that showed the greatest performance opportunity. The usual sales PIP was about a 7, meaning the opportunity was present to increase revenue seven times the current amount.

Here is a four-step example of calculating PIP for a professional services sales force that sells $19,250,000 per year.
1. Identify “star” performance. In this sales force of 20, the top salesperson sold at a rate of $5 million of professional services per year.
2. Identify “average” performance. The remaining 19 salespeople sold--on average--$750,000 worth of professional services per year. The left-hand side of Figure 1 illustrates this current state of sales.

3. Determine the maximum performance improvement potential (PIP). This sales force had a PIP of 6.6 ($5,000,000/$750,000), meaning the star salesperson was 6.6 times more effective in selling than the average. If it were possible to get everyone to perform at the level of the star performer, annual revenues would go from $19,250,000 to $100,000,000--a potential increase in revenue dollars of $80,750,000.
4. Establish a “realistic” PIP. Differences in the sales environment (number and type of accounts, market conditions, etc.) do have a bearing; do not ignore them. Furthermore, of those 19 “non-star” performers, one or two may be new to the sales force and thus have less experience. Therefore, to be conservative, calculate a “realistic PIP” by determining one-fourth of the total PIP.

The right-hand side of Figure 1 shows that the realistic performance improvement potential of the sales force in the example is $20,187,500, double the existing revenue.

Who would not be delighted to double existing revenue? The good news is that this is doable. Gilbert’s research reported that the very best performers do just a few things differently from the rest of the pack.² In most cases, skilled observers can define those behaviors in a matter of days.

Usually, they can readily teach what they learn to the rest of the sales organization with awesome results. This is truly an area of low-hanging fruit. My work in applying these concepts with clients confirms this potential. It is a powerful way to focus research on those few vital areas that make a big difference.

My recommendation is to dramatically change your focus on sales force development. Put your time and money in the place that will yield the greatest ROI: your top performers. Use their results and behaviors as the targets and models for everyone else. The laggards will “de-select” themselves, and the average performers will step up to the challenge.

Best Practices

Best practices for improving sales performance are as follows:

• Conduct a yearly “star analysis,” and use it as the framework for establishing PIPs, determining critical sales behaviors, and creating hiring profiles for future recruits. Train everyone who touches the customer on the behaviors that work.
• Reformulate your sales development plan to spend:

- 40 percent of the time working with your very best. Observe and question to find out their secrets.
- 50 percent of your time observing your average performers. Teach them what you learn from the best.
- Only 10 percent of your time working with the laggards. Yes, they deserve a chance to improve, but this is almost always a system issue and not a coaching problem.

• Make sure your sales management system is performance-based, not activity-based.
• Make managers personally accountable for the recruitment, development, and retention of top performers.
• Dole out substantial incentives for employees that induce top outsiders to join the sales team.
• Tolerate unusual behavior from the stars. Often their success lies in going around the existing system and snubbing the accepted norms of behavior.
• Form a partnership with a professional services-savvy search firm.
• Create alumni networks to maintain relationships with key personnel.
• Encourage your stars to write and speak.
• Encourage and reward stars for mentoring new salespeople.
• After two or three years, conduct a star-performer analysis of a top-flight sales organization outside your industry.

Want to have the reputation of a world-class sales leader? Follow my advice and reap the rewards and recognition.

References/Endnotes
1. Gilbert, Thomas F. 1978. Human Competence: Engineering Worthy Performance. New York: McGraw-Hill.
2. ibid.