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Evaluating the Performance of Salespeople

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Enhance communications between salesperson and sales manager. Improve ... of information ... used to develop performance results and critical behaviors ... – PowerPoint PPT presentation

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Title: Evaluating the Performance of Salespeople


1
Evaluating the Performance of Salespeople
  • Module Ten

2
Purposes of Salesperson Performance Evaluations
  • Ensure that compensation is consistent with
    actual salesperson performance
  • Identify salespeople that might be promoted
  • Identify salespeople who should be terminated and
    to supply documentation
  • Determine training and counseling needs
  • Human resource planning
  • Identify criteria for recruiting
  • and selecting salespeople

3
Purposes of Salesperson Performance Evaluations
  • Advise salespeople of work expectations
  • Motivate salespeople
  • Help salespeople set career goals
  • Relate salesperson performance to sales
    organization goals
  • Enhance communications between salesperson and
    sales manager
  • Improve salesperson performance

4
Salesperson PerformanceEvaluation Approaches
  • General conclusions
  • Annual basis
  • Combine input and output criteria
  • Use quantitative and qualitative measures
  • Performance standards and quotas are set in
    collaboration with salespeople
  • Assign weights to different objectives
  • Incorporate territory data

5
Salesperson PerformanceEvaluation Approaches
  • General conclusions (continued)
  • Multiple sources of information
  • Conducted by the field sales manager who
    supervises the salesperson
  • Provide a written copy of the review and conduct
    a personal discussion

6
360-Degree Feedback System
  • Evaluated by multiple raters
  • Salespersons value to the organization and
    customers
  • Considerations
  • Quality data
  • Confidentiality
  • Useful
  • Not used exclusively

Sales Manager
Evaluation
Team Members
Oneself
Evaluation
Evaluation
Evaluation
Evaluation
Internal Customers
External Customers
7
Perspectives on Salesperson Performance
Evaluation
  • Outcome-Based
  • Little monitoring of people
  • Little managerial direction of salespeople
  • Straightforward objectives measures of results
  • Behavior-Based
  • Considerable monitoring of salespeople
  • High levels of managerial direction of
    salespeople
  • Subjective measures of salesperson
    characteristics, activities, and strategies

8
Dimensions of Salesperson Performance Evaluation
9
Criteria for Performance Evaluation
  • Behavior
  • Activities performed
  • Activities to promote long-term customer
    satisfaction
  • Sales calls
  • Customer complaints
  • Required reports submitted
  • Training meetings
  • Letters and calls to prospects

10
Criteria for Performance Evaluation
  • Professional Development
  • Assess improvements in certain characteristics
    traits, skills, knowledge
  • Attitude
  • Product knowledge
  • Initiative and assertiveness
  • Communication skills
  • Ethical behavior

11
Criteria for Performance Evaluation
  • Results
  • Measured objectively sales, market share
  • Possible negative effects
  • Sales quotas

12
Elements Important in Assigning Sales Quotas
  • Concentration of businesses
  • Geographic size of the territory
  • Growth of businesses within the territory
  • Commitment by the sales manager to assist
  • Complexity of products sold
  • Past sales performance
  • Extent of product line
  • Financial support
  • Amount of clerical support

13
Criteria for Performance Evaluation
  • Profitability
  • Specific products sold
  • Prices negotiated
  • Expenses incurred
  • Criteria

14
Performance Evaluation Methods Characteristics
any method should include
  • Job Relatedness
  • Reliability
  • Validity
  • Standardization
  • Practicality
  • Comparability
  • Discriminability
  • Usefulness

15
Performance Evaluation MethodsGraphic
Rating/Checklist Methods
  • Performance evaluation form
  • Especially useful in evaluating behavioral and
    professional development criteria
  • Good on most characteristics, especially job
    relatedness, standardization, practicality, and
    comparability
  • Disadvantage is providing evaluations that
    discriminate sufficiently

16
Performance Evaluation Methods Ranking Methods
  • Rank all salespeople according to relative
    performance on each performance criterion
  • These methods force discrimination as to the
    performance of individual salespeople
  • May be complex
  • Rankings only reveal relative performance
    evaluation

17
Performance Evaluation Methods Objective-Setting
Methods
  • Management By Objectives (MBO)
  • Mutual setting of well-defined and measurable
    goals within a specified time period.
  • Managing activities within the specified time
    period toward the accomplishment of the stated
    objectives.
  • Appraisal of performance against objectives.

18
Performance Evaluation Methods Behaviorally
Anchored Rating Scales (BARS)
  • Links behaviors to specific results
  • Salespeople are used to develop performance
    results and critical behaviors
  • Positive feedback about behaviors may be more
    effective than positive output feedback

19
  • BARS Scale Cooperative Relations with Other
    Sales Team Members Behavioral Anchor
    Statements Could be expected
  • to cooperate when aid is requested by other team
    members.
  • to go out of her/his way to help the team
    achieve its goals.
  • to lend a helping hand and can be expected to
    try hard to help the team.
  • to occasionally support the team on problems
    encountered in the field
  • to contribute half-heartedly to the team effort
    to accomplish goals
  • not to care much about the team and its members
  • to antagonize members of the team and pull
    against the team goals

10 9 8 7 6 5 4 3 2 1 0
20
Performance Evaluation Bias
  • Occurs when a managers evaluation of a
    salesperson is affected by considerations other
    than the specified criteria
  • Common sources of bias
  • Personal relationships
  • Perceived difficulty of territory
  • Impression management
  • Halo effect
  • Outcomes bias

21
Framework for UsingPerformance Information
22
Salesperson Job Satisfaction
  • Job satisfaction related to turnover,
    absenteeism, motivation, and organizational
    commitment
  • Job satisfaction may be related to performance
    (direction of relationship is unknown)

23
Salesperson Job Satisfaction
  • INDSALES measures satisfaction with
  • Job
  • Fellow workers
  • Supervision
  • Company policy and support
  • Pay
  • Promotion and advancement
  • Customers
  • Results may identify areas where manager may
    intervene to improve job satisfaction
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