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How to Motivate Sales People Without Money?

How to Motivate Sales People Without Money?

It is common knowledge that many sales people can calculate how much commission they have earned faster and more accurate than any super computer. Indeed, money is a key driving force that motivates most, and certainly for the more successful ones.

However, is money then the ONLY motivator, or are there anything else?

If you were to ask anyone why they want to be one, there will usually be 3 answers:

1. For the money (of course);
2. Being able to directly link their efforts to tangible results; and
3. Having the (relative) independence and flexibility in their jobs

As such, while money may be the key driver for most, it certainly is not the only one. They are also motivated by a sense of achievement, and the more successful ones usually have large egos as well.

If we were to look deep into what motivates people, here are 2 factors that we need to consider:

1. Are the rewards attractive (or punishment severe) enough?
2. Am I able to achieve it?

Avoiding Pain vs. Seeking Pleasure

While making money is a great pleasure for many people, including sales people, some are first motivated by avoiding the punishment of NOT achieving their monthly, quarterly or annual sales targets. Hence, it’s a very common practice for sales people to “hide” potential contracts to “save them for the next financial period”, rather than to risk NOT meeting the sales targets for that period.

Sales people are indeed masters of work flow optimization in this sense. However, this does not help you in getting results from your sales team, and sometimes deals may be lost due to the delays caused when sales people want to “save them for the next quarter”.

When companies use money as the only motivator, it is also a riskier proposition. There’s nothing to prevent competitors to use the same motivator to entice your best people (along with your best customers) to defect. While there may be some non-competitive clauses in employment contracts, these are seldom enforceable, especially in Asia.

As mentioned earlier, successful sales people usually have large (sometimes over-sized) egos. Nothing feeds the ego other than believing (correctly or otherwise) that you had singlehandedly contributed millions of dollars to your company’s sales revenue. However, massaging the sales person’s ego (either by making them superstars when they succeed, or “humiliating” them when they don’t deliver the intended results) is a double-edged sword. On one hand, it will drive people to achieve super-human results. On the other hand, they may be so focused on their self-achievement that they become insensitive to issues such as:

Serving customer needs,
Maintaining healthy margins,
Ensuring cross department support and
other factors that will impact business results.

When the egos become over-sized, some people can have a false sense of “invincibility”. Some live on past glories, even when current sales results are not as good or outstanding as before. To overcome this, Dell Computers have made sure that their egos are in check by just focusing on the present and future. Past performance mean nothing to Dell’s sales managers, and a top performer is only as good as the next sale. They are as such motivated to maintain their “successful” status every single day.

Eventually, sales people get burnt out. Depending on the industry, they usually achieve their peak about 1 to 1.5 years after joining a company. How they perform beyond the peak period is a matter of how you motivate and nurture them.

Besides dishing out ever better incentives (usually money-related), many companies chose to promote their top sales to be sales managers. Unfortunately, both motivational strategies are not effective. When they feel burnt out, it’s not an issue that can be resolved with money (or most incentives). In addition, only 15% of top sales people can be competent managers.

When they feel burnt out, it is usually they found that they are not further developing themselves or learning anything new anymore. Usually, they found they have reached some kind of plateau in getting better sales results, and the repetition of doing the same old thing is becoming boring to them as well.

This is also the phase when good people are the most vulnerable to defecting to your competitors. To overcome this, we will have to looking into other overlooked motivators.

Can I Do It?

As mentioned earlier, the other aspect of motivation is whether you feel you are able to do your job well.

In some industries where sales management practices tend to be Neanderthal (email me to find out which ones), the attrition of new sales hires are astonishingly high. These new hires are motivated by making more money, just like any successful sales person will be. However, due to the lack of proper training, coaching and guidance, as much as 90% of these new hires leave within 1 month. If they don’t see brightness of the future, they’ll just go.

While such companies do provide some level of sales training, as much as 87% of all sales training evaporates within 1 month of the training. And this statistic refer to companies with better sales management practices in place. For companies with weaker sales management, most of these training are outdated and don’t really prepare the sales person to handle customers in the real world. Without a post-training supporting environment, the new hires feel overwhelmed and and helpless, and then they just leave.

When sales people find that they are not able to achieve better results, or net bigger deals, or improve margins, what they need now is support from management on how they can achieve breakthroughs. They know that if they can do better, the monetary incentives are all there waiting for them. What they really need is the right guidance and support them how they can do so.

Besides providing the usual training, here are other ways that managers can get their people proceed to the next level of performance:

Align sales strategies to market realities. Sometimes, due to rapid market changes, sales strategies mapped out 6 months ago may have already be outdated. A sales strategy re-alignment may help close more sales;

Provide recognition of improvements in sales process. While people are rewarded (or punished) based on results (sales targets), few sales managers actually recognize the improvements that sales people made in their sales process. If sales people made sales process improvements, it is very likely that this will lead to better results. Such improvements need to be recognized, reinforced and made as good examples for others to follow.

Motivating the Sales Force Without Using Money

In a nutshell, when people join the sales force, they may do so in the hopes of making more money. However, if you want to get them to perform to the next level of performance, you will need to improve their skills and abilities to achieve better results. In fact, management guru Ram Charan mentioned that if using incentives as the main means to get better performance from the sales team is an outdated approach

If you find isolated cases of poor performance from your team, then perhaps these few bad hats are just making excuses not to work hard. However, if you find that poor performance is widespread and pervasive in your sales force, then you, as manager, are making THE excuse for not providing the necessary support and guidance for your people.

Pls. see www.psycheselling.com/page4.html for explanation of some key concepts discussed here.