2 Techniques to Create Realistic Sales Targets that Drive High Performance

Sales Leadership Techniques To Tell if You Have Realistic Sales Targets
Our organizational alignment research found that sales strategy accounts for 31% of the difference between high and low performing sales teams.  Setting realistic sales targets that drive higher performance is no easy task.  Do not ask for too much or too little if you want your sales team to perform at their peak.

Goal Setting Psychology
There is a fine line between setting goals that stretch sales reps’ capabilities within the realm of possibility and sales goals that are virtually impossible to reach. One encourages greater effort; the other causes frustration, disengagement, and the urge to quit even trying.

If you want to raise the performance level of your solution selling team, you need to find a happy medium between sales goals that are actually achievable and those that cannot be reached.

Why Do Sales Leaders Struggle with Setting Effective Sales Targets?
Some sales leaders mistakenly believe that consistently higher sales targets lead to consistently higher sales. Others feel sales pressure to come up with forecasts that will look good to executives and investors. And others just incrementally increase last year’s numbers to fit the current year budget projection without much data to substantiate them.

Two Helpful Techniques To Create Realistic Sales Targets That Drive High Performance

It all starts with setting SMART goals.  Once that has been accomplished:

1. Consistently Track and Share Performance Results
   Monitor performance quarter-by-quarter so you can understand how many sales reps succeed and how many fail. When sales goals are realistic for your unique sales strategy and sales culture, you can expect 60-75% of your team to reach them.

   If you see your goal attainment percentage fall from one tracking period to the next, initially suspect your sales strategy or sales targets – not your sales team.  If up to 20% of your sales team misses their targets, it may well be a problem with the specific salespeople. But when 50% or more fall short, you can assume the problem lies elsewhere.

   Take a hard look at your sales strategy, your sales culture and your sales targets.

2. Track Sales Rep Engagement and Turnover
   Any good sales manager will keep track of sales team engagement and sales team attrition. Of course, the worst people to lose are the “A” sales players you and your customers count on most. If you find that your high sales performers are disengaging or leaving at too high a rate, try setting more realistic goals that better align with your sales strategy and sales culture.

The Bottom Line
Challenging and possible sales targets can help to get the most out of your sales team.  Unrealistic sales targets decrease performance.  To help your sales team perform at their peak, make sure that your sales targets are clear, relevant, meaningful, fair, consistent, accurate, trusted, timely, transparent, and just possible.

The list may seem long, but sales target are too important to get wrong.

If you want to learn more or take the first step toward creating high performance and realistic sales targets, download What is the Right Amount of Sales Performance Pressure