6 keys to your employees' hearts

 (Image courtesy of Flickr user Lara604)

CBS News http://ow.ly/98rKg

Michael Hess

(MoneyWatch)  

Valentine's Day has come and gone but it's always a fitting time to talk about employee love. (No, not the "meet me in the storage room in five minutes" kind.) I'm talking about the things that the best companies do to engender the dedication, loyalty and, yes, even the love of the people who work for them.

Everyone knows that the days of the one-company career are long gone. Depending on what data you choose to believe, the average person will change jobs somewhere around five to seven times in a lifetime. So if you run a business, it is virtually certain you will lose every employee you have (hopefully not all at once). In fact, you might even help some of them move on.

It's a reality that stinks, because enlightened companies know that employees are at least as important as customers and other stakeholders, and great employees are hard to find and painful to lose. But it's a reality nonetheless. So, while you may have to accept the likelihood that your people won't stay forever, you should never stop working at making your company the kind of place that's hard to leave.

Companies with the happiest and most productive employees, and the lowest turnover, tend to have these six people-priorities (or similar iterations) in common. Compare your own work environment to this list to see if your business is geared towards retention:

Trust. In both directions. Your employees need to trust you, know where they stand with you, and feel safe with you. And you must show that you trust them, whether it's with projects, decisions, time or money. The miserable and destructive phenomenon of "office politics," as cliched as it may be, really boils down to nothing more than issues of trust.

Responsibility. Give your people as much as they can handle, maybe even a little more. It tells them that they and their jobs are valuable and gives them a chance to shine (or fail). It helps you identify star performers, it discourages logjams and gets more done, and it's good for your business.

Culture. I've written about it a lot and I can't write about it enough. Your company culture -- both the qualities and genuineness of it -- is its heart and soul, the glue that holds it together, the spirit that drives it. Plain and simple, great employees don't stick around companies with lousy cultures, and all other things being equal, employees perform better within a great culture. And this is an area where smaller businesses can almost always have an edge.

Opportunity. People naturally want to keep moving, preferably upward. And they will naturally stay with an employer longer if they know they can earn the chance to do more or different things, climb the proverbial ladder, make more money. This can be challenging for small companies, as with only a handful of jobs there just might not be a ladder to climb. You may not have a "track" from manager to vice president to CFO, but you should seek and create opportunities for people wherever and however you can.

Recognition. Some people love getting awards, plaques, employee-of-the-month parking spaces, and other material attaboys, and those things are OK. But what really matters over the long term is ongoing, straightforward, day-to-day appreciation and recognition. Give genuine praise, both publicly and privately, for work well done. Never take even tacit credit for someone else's work (and in general give much more credit than you take). Say thank you, often. There are few things that will get an employee to start polishing up her resume faster than feeling unappreciated.

Compensation. I saved this one for last because although it's a given that people work for money, of everything on this list, it's frankly the one over which most small businesses have the least control. Clearly a good employer must do its best to pay good people what they're worth, but small companies often can't compete with big ones when it comes to compensation or "packages." So while pay is obviously a critical issue, the limited resources of a small business make the other five elements all the more important. 

Trust, responsibility, culture, opportunity and recognition are entirely within the means and resources of any company, and it has been proven time and time again that employees will, within reason, make salary compromises for the most appealing overall opportunity.

The employer/employee relationship is much the same as any other relationship: what you get largely reflects what you give.

Kevin Brown- kbsinsight.blogspot.com 

On Leadership-Some Great Tips

NOTE- While this article references Federal Leader- I'd suggest you just substitute LEADER By Tom Fox, Published: January 10 Justin Menkes is a leading expert in the field of evaluating C-suite executives and preparing individuals for the CEO position. He is the author of two books about executive leadership, Executive Intelligence and Better Under Pressure, published by Harvard Business Press. This interview was conducted by Tom Fox, who writes the Washington Post’s Federal Coach blog. Based on your experience, what traits are needed for a federal leader to be successful? There are three attributes that I think best enable a leader to maximize the efforts of the 21st century workforce: realistic optimism, subservience to purpose and finding order in chaos. What is realistic optimism? Realistic optimism is especially important for a federal workforce. I think that if you’re going to lead people, you can’t sit there and tell them, “Everything’s going to be fine.” When you look at poor performing or inept leaders, you find they are often incredibly optimistic. The difference is that they have blind optimism. So, if you say, “We will conquer all. The obstacles and adversities you’re discussing are not important for you to worry about because we’re going to win anyway,” you’ll lose them. But those with realistic optimism are the ones that say, “These are the challenges that we face and these are some of our proposed solutions. None of us is sure what the final solutions to each problem will look like, but here are our contingency plans for trying to address them. And, I do believe that together, as a group, we’re going to meet our challenges. I have no doubt about it.” That is what it looks like to express realistic optimism. What about subservience to purpose? Today, a paycheck is not enough. Workers have to get out of bed every morning believing in what they’re doing. They have to believe that their presence and the activities that they perform on any given day will make positive, meaningful impacts on the world. Southwest Airlines is a great example. Their people outperform competitors on every metric of productivity that exists. They believe that not only the rich should be able to fly in this country. So they’re going to get those airplanes off the ground on time and as inexpensively as possible, because they believe that that’s an important mission for America. This sense of purpose has lasted since Herb Kelleher founded the airline 35 years ago. Explain bringing order to chaos. Finding order in chaos is critical. Leaders cannot throw up their hands and give up. In many ways, today’s workforce has fallen behind in this area. It’s not being trained to find joy in the pressure-filled situations that we face. In the world and the economy today, there is more unfamiliar than familiar. So, you’ve got to get comfortable with it. The best example of this is A.G. Lafley at Proctor and Gamble. Before he retired, he was in Brazil watching housewives do their laundry in the bayous. When I asked him why, he said that his company had introduced a laundry detergent that should have been hugely popular among this particular Brazilian population. The detergent required no rinse cycle for clothes to be clean, [but] nobody wanted to buy it. Ultimately, what he found out was that the detergent didn’t make suds. As soon as they added suds, the women felt like the product was working. They started using the detergent and the product became a huge hit. How can current senior federal leaders cultivate these three attributes in their emerging executives? There are some wonderful things they can do. One of the great teachers of realist optimism is David Novak at Yum Brands. One of the things he’s done is use catch phrases. He found that when people are not taking responsibility or accountability for their actions, being realistic but optimistic is achievable. He introduced this phrase called ‘victimitis.’ So whenever people would say, “Oh, it’s not my fault,” or attempt to defend their bad actions, all of their colleagues would say, “Victimitis, victimitis!” Part of what he did was about building a culture and giving people tools they can effectively use — and in some places, playfully use. We need to remind ourselves that our destinies are in some ways beyond our control, but that our day-to-day, work-to-work, minute-to-minute experiences are still very much under our control. As a leader, if you’re sitting there having to block Internet sites on your employees’ computers, you’ve already lost the battle. You have to have them be interested and motivated to do their work without you looking over their shoulders. - Posted using BlogPress from my iPhone

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3 Mistakes in Sales Compensation Plans

Sales Force Effectiveness Blog

3 Mistakes that Alienate ‘A’ Players When Designing Sales Compensation Plans

When you are designing sales compensation plans for 2012, don’t make the mistake of alienating your ‘A’ players. Our firm is at its busiest in the fourth quarter in large part because we are hired to help our clients improve their sales compensation plans. Here are three common mistakes that arise again and again that you should avoid when you design your sales incentive plans next year.




1. Caps – For some reason, companies try to “mitigate risk” by putting caps on commission plans. There may be no greater risk of demotivating your ‘A’ players than showing them their earnings will be limited with a cap. It’s the equivalent of telling Michael Jordan his baskets will stop counting after he scores 50 points in a game.

Call to Action – Push your chips into the middle of the table on your sales compensation plans. If someone blows it out next year and earns more than anyone else, so what? Pay your sales reps for doing what you hired them to do: Sell. If you are having a hard time accepting the mental model of unrestricted earnings for your sales people, consider the alternative of poor performance resulting in you being replaced.

2. Claw Backs – 90% of all compensation plans we review have some type of “claw back” language in them. This is the premise that companies reserve the right to make a rep pay back their commissions and bonuses if something changes in the account. For starters, most state laws state that if you “overpay” an employee, they have to volunteer to repay the money back. Good luck. Secondly, if you are clawing back commissions for anything other than gross negligence on the part of the rep, your incentive plan is the problem.

Call to Action – Remove this language from your sales compensation plans in 2012. This is a close second to plan caps in the demotivation department. Want to build trust and credibility with your sales team? Tell them you are taking this out and designing a sales compensation plan for them that makes claw backs irrelevant.

3. Plan Descriptions – Companies seem to measure the worth of a sales compensation plan document by its length. A 15 page sales compensation plan document is 14 pages too long. We sales people are simple animals. Don’t overcomplicate the issue. More importantly, lead with the headline. The commission plan and calculation method should be front and center on page 1, not buried somewhere on page 13.

Call to Action – Don’t bury the lead. When ESPN announced Albert Pujols’ new 10 year, $250M baseball contract, they didn’t read the fine print to viewers. Why? Because the audience wants to know what he will earn. Nobody cares that he isn’t allowed to hang glide in the offseason.
The competition for ‘A’ players in the job market is increasing every day. If you want to hang onto yours in 2012, avoid these 3 common mistakes when designing sales compensation plans.


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Why Customer Service Is The New Marketing

ENTREPRENEURS | 12/28/2011 @ 1:43AM |13,726 views
Why Customer Service Is The New Marketing
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Treat yours customers as if they were newspapers reporters; this is the new mantra for savvy companies of all sizes.

As consumers, we’ve become disenchanted with advertising and marketing of all sorts, having being duped, tricked or made to feel foolish on more than one occasion. The last true medium that holds sway is referrals from friends, colleagues, or online reviews from the likes of Yelp, AngiesList or TripAdvisor. According to a survey by the American Marketing Association, 90 percent of consumers trust peer reviews and 70 percent trust online reviews. It’s the last, true, medium that many consumers turn to when faced when inundated with choice, and confused by similar-sounding sales pitches.

Perhaps it is because reviews are the last sacred ground, that a flurry of outrage spread like wildfire across the Internet when news leaked that Reverb Communications (a PR agency) was paying interns to write positive reviews on iTunes for their clients Apps. Or when the occasional Amazon.com author gets ousted for disparaging competing books while positively reviewing their own. If you can’t trust advertising messages, and you can’t trust reviews, what else is left?

Based on my experience growing 99designs into a company that earns 7-figures per month, based largely on word of mouth, here are my three golden rules:

Think long-term reputation vs. short-term profit.
Trying to optimize profit on a sale-by-sale basis is a fool’s game, leads to frustrated customers and lost repeat business. When FedEx left an eBags package without a signature at our office building over the weekend which got stolen, a single email to the company resulted in a quick refund to my credit card. Compare that to a recent experience with a National Retailer, where a request for an exchange or refund took two store visits, three people, and more than 90 minutes of waiting while employees scoured the back-room for inventory that turned out to be non-existant.Even Apple lived up to its reputation recently, happily issuing me a partial refund on a laptop order after I failed to claim a discount I was eligible for. It would have been easy to transfer me around different departments, put me on hold, or outright say “no” to retroactively applying the discount. But the first person I spoke to happily made it happen even though they had no idea that we had 90+ employees on MacBook’s that we regularly refresh, spending thousands in the process. You never know who the customer is on the other end.

Identify your top customers and make them feel special.
With many companies, the most feverently loyal customers represent a disproportionately huge chunk of revenue. Knowing who those people are — and giving them special attention — is a must-do for every company. I recently had a conversation with the founder of a large Las Vegas based conference that’s been running for more than 10 years who used Klout.com to identify his most influential attendees. By offering just a little bit extra (free limo service to and from the airport), a dozen influencers directly contributed to over 100 additional tickets being sold with almost no additional marketing costs.

Make yourself available.
I had my personal cell phone number on sitepoint.com for 10-years (a site visited by more than 2.5 million people every month and ranked Top 1000 in the world), and was happy to answer more than 30 calls on Christmas Day, when a special deal we were running on the website went wonky. These days, we have dedicated support reps for us on three continents, and we’ve never outsourced to a call centre to cut costs.

Tony Hsieh from Zappos says his company loves to talk to customers, and classifies customer service as a marketing investment, rather than an expense that must constantly be slashed and analyzed. Zappos has no metrics that reps have to hit around calls per hour, average time per call, or other silly nonsense that leads frustrated customers.

Some businesses are even taking it a step further, by turning their most prolific fans into advocates and online sales people. Under Armour and Skullcandy have recruited an online sales force made up of their most loyal and knowledgable customers and are paying them with cash and gear for answering live chat requests from prospective customers on their websites. After all, who better to make authentic product recommendations and answer detailed product questions, than the customers already using them? No outsourced call centre team can match the passion, product knowledge and helpfulness of your most ardent supporters. There is hope.


Courtesy of YEC
Matt Mickiewicz, the co-founder of 99desings, started his first company while still in High School, and has leveraged his early success into 3 profitable businesses which have have published 50+ web design books in 20 languages, paid designers over $24 million for their graphic design work through 99designs, and helped entrepreneurs sell over $60 million in websites and domain names on Flippa.


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The Amazing Power of Deflationary Economics for Startups

Both Sides of the Table
Entrepreneur turned VC

The Amazing Power of Deflationary Economics for Startups
by MARK SUSTER on DECEMBER 22, 2011


I’m often asked by people what investment areas interest me.

It’s true that I have a functional focus on three areas: Performance-based marketing, digital television and mobile computing. I try to invest in things that I know and that I believe I might have better knowledge and relationships than the masses of VCs.

I have other areas of interest & competence such as cloud computing and document management given my background.

It’s also true that I’m mostly founder driven, where the founding team & my personal relationship with them leads to a strong mutual working relationship. If that bond isn’t there or if it feels like I’m in a bidding process for the highest price, I might as well be Wells Fargo.

But one theme in pervasive in all my thinking about investing in Internet-based companies: Deflationary economics.

And it’s something I think you ought to consider when building your Internet businesses.

Here’s what I mean

When you think about the great achievement of the Internet in aiding content, commerce & communication they include:

Large scales of connected people & information never seen before in humanity
Unprecedented transparency of information
Open standards that make it easier to plug into other products & services, creating a global bazaar
Socially connected individuals and platforms that enable faster roll-outs of successful products
Payment ready consumers (Amazon, iTunes, PayPal) and businesses (Google AdWords, Square)
So which types of businesses become super successful given this environment?

Ones that offer amazing value (low relative margins) at high volumes that makes it nearly impossible for high-cost incumbents to compete. That’s what I mean by deflationary economics.

It is a classic case of the Innovator’s Dilemma in practice. If you’re a startup and you haven’t read my summary of Clay Christensen’s seminal work please do.

It’s the single most influential piece of work in determining my investment philosophy and how I think about markets. In a recent panel discussion I participated in with Fred Wilson he said the same.

Why Deflationary Business Win

In the simplest form, new startups have a product that is INFERIOR to that offered by the competition but at a dramatically lower price with the seller opting for a very thin margin on their product.

Initially their only customers are people who can get by on the reduced functionality or perhaps don’t have the money to spend on the expensive product.

Often it turns out that the market is greatly expanded by having a lower price point new entrant. And over time the new entrant attracts enough business that, as depicted in the graph above, the quality of the product slowly increases over time.

The new entrant keeps margins low but suddenly has a lot of profits due to large volumes of business.

How does the incumbent respond? Not by dropping price & quality – they don’t have an advantage there. Instead they spend more money trying to innovate on product quality and call attention to the weaknesses of the new entrants product quality.

Often major customers defect en masse to the new entrant as they realize that the huge price premium is not justified by the product differentials.

That is what Clay Christenson defined in his book as “The Innovator’s Dilemma.”

And this approach to looking at startup industries is what I call “deflationary economics.”

How it May Apply to Your Business?

When I’m asked about all of the mistakes I made at my first startup (I made them all) I often tell people that the single biggest mistake that I made was charging too much for my products.

We knew how to sell – we had clients paying $1 million / year. We knew there was value in what we provided. In order to grow we hired successful and expensive sales people who in turn were able to (and incentivized to) sell projects at higher margins and close big deals.

This was a mistake.

We grew really fast for a few years. But eventually low-cost new entrants came into the market offering most of our features at 10% the costs. We still won large customers but over time it became harder to compete.

Had I taken the lower-margin approach I really think I’d be sitting atop a $1 billion+ company today.

So when you start your company think carefully about whom your target customer is. If you’re trying to be a value-based product or trying to scale to a large market size you may want to think about deflationary economics.

Does your product dramatically reduce costs in an industry with large incumbents and fat margins?
Can you provide a narrowly focused product to a niche of that market who will be attracted to dramatically lower costs?
As your business grows can you find ways to continually lower your costs by whatever means?
I would also think about how you use scale to your advantage to keep margins low.

Are you offering a product where the supply costs will continue to drop precipitously? (think Amazon’s Storage costs)
Are there alternative ways to monetize your product where incumbent are not? (think virtual goods of Zynga, ad supported models, freemium models)
Are there ways to offer super low margins on your product knowing that you will overlay other product offers to the same customers later that will improve your margins?
Most of the Internet’s Greatest Successes Have Been Deflationary

Craigslist – Think about what Craigslist achieved. It’s remarkable. They took an industry that had charged people large sums of money (the classified industry) and made it almost entirely free. How do existing incumbents compete with that?

Craigslist is kind of an anomaly in that it’s founder seems to run it in a non-traditional style and with some objectives other than the pure profit motive. But by providing free listings he build critical mass (volume) so charging small amounts for certain types of listing (i.e. recruiting) he could build a very profitable business.

Craigslist is everybody’s favorite business to say, “I’m going to disrupt them” but somehow nobody has really been able to. Given their terrible UI I’m sure it will eventually happen. But beating free is hard, as is creating a two-sided market (chicken & egg problem).

Amazon – Amazon is the ultimate deflationary business. Everybody knows the story well. They launched as an online book seller.

They had huge scale advantages because they could offer a much wider book selection since they didn’t need to be limited to the physical floor space of a physical retailer.

They had huge cost advantages because they didn’t need to pay for retail space or all of the retail workers. They even



had a government break because they didn’t need to charge taxes and thus consumers got an even better price.

But Amazon didn’t try to build a hugely profitable business. Does that sound dumb? I always see naïve journalists comment negatively on businesses that are “not profitable.” Sometimes it’s good to not focus on profitability & sometimes it’s bad.

There is a tension between profitability & growth. The more you want the latter the more investments you make in people and infrastructure now to pay for faster growth that expense of short-term profitability.

It doesn’t work for every business. But if you are growing uber fast, building for scale and have access to capital to fund your growth then it’s always the smart play.

So instead of maximizing price they kept cutting costs. Innovator’s Dilemma. How do physical retailers compete with that? Especially when Amazon will offer free shipping for its best customers.

And Amazon wasn’t content with just being books, they wanted to be THE Internet retailer. Walmart in the cloud. This generation’s Sears Catalog. So they kept cutting costs of everything they offered.



And then they decided they wanted to be the Internet retailer of computing services so they created Amazon Web Services

(AWS). And they made it so cheap that everybody gravitated towards them. They had a scale advantage and were driving deflationary economics (in other words, massively driving down the costs of goods & services).

I was at Salesforce.com when Amazon was super aggressive on that storage pricing. I met with our network experts to figure out whether we could launch a competing service. The assessment of our best experts was that we couldn’t. Their view was that Amazon was taking a loss on providing Internet storage.

I have not inside data on that but I’ll be they were right. I’ll bet that Amazon’s view was to start with a loss leader because they knew that storage costs could come down and that they could add more service on top of their storage product and ultimately provide a profitable bundle of IT services to their customers.

In other words, storage might have been a “loss leader.” In any event, they had such scale advantages in providing this Internet infrastructure that to this day nobody in the industry has come close to matching them.

In my estimation this is one of the biggest strategic mistakes Google has made in not competing more aggressively with AWS. The Cloud is the future at Amazon has an enormous lead. As far as I know, the revenue in AWS is not publicly broken out but the last rumor I heard was that it had crossed $1 billion per year.

Google – They have led the deflationary pressure on advertising, bringing whole industries into chaos. This has particularly hurt the print media businesses that can no longer charge enough to pay for editorial, printing & distribution.

They are bringing deflationary economics to word processing, spreadsheets and office automation. They are bringing deflationary economics to local advertising.

I guess I would describe Google as the ultimate scale & deflationary business.

Skype – As with many deflationary businesses, Skype started by giving away its product for free. Free phone calls anywhere in the world is as deflationary as it gets.

Telecommunication companies are still charging people for phone calls when the costs to them of providing the calls is infinitesimally small. Data transfer is what costs telecom companies money these days.

Ultimately when Skype had 10’s of millions of users it rolled out products that made money. They started with “Skype Out” which was placing a call from a Skype line to somebody on a normal telephone. They charge for this call, but they charge at rates that are an order of magnitude cheaper than a telco.

Expect this industry to be whiplashed by deflationary economics in the next 5-10 years. It’s no wonder they’re pushing so hard to be become our Internet supplier and our TV suppliers. Unfortunately for them neither of these businesses will escape the deflationary maelstrom either.

TextPlus – Speaking of telecom disruption, a new breed of mobile telco is emerging that are riding the deflationary wave. It’s the reason I invested in TextPlus. At 25 million downloads & 10 million monthly active users we’re achieving a scale that makes it a very attractive opportunity.

We started offering free text messaging at a time when most telcos are still charging $240 / year for unlimited-texting plans. In many parts of America that’s a lot of money for families to be absorbing for something that costs the telcos almost zero. That’s one reason a free texting app has been so popular.

But beyond that TextPlus now offers free phone calls to other TextPlus users and out-of-app calls are a fraction of the normal costs by mobile providers.

Expect a deflationary revolution in the global telecom market – at a minimum for voice services. And with 6 billion global handsets you can imagine what an immense market this will be.

LinkedIn – Lots of people talk about LinkedIn as a social network. What interests me is the deflationary impact that LinkedIn and other recruiting websites have had on the recruiting market.

Think of the principles I described about Internet economics of Craigslist: huge scale, many parts of the service are free and monetize the narrow features where businesses are willing to pay – and at hugely deflationary prices to their normal recruiting fees.

Zynga – Deflationary. In the offline world people were buying consoles and then paying for game titles separately – many in the $29-49 price range per game. Along comes an immensely scaled business that offers games for free.

I know, it isn’t offering the same quality of games so I’m not arguing that the entire game console business goes away over night. But it is hard to argue longer-term against the deflationary pressures that Zynga brings.

Maker Studios – Network television costs $50,000 – 100,000 per minute to produce. Reality shows can be cheaper, with the lowest-end costing $6,000 – 8,000 per minute.

Maker Studios is an Internet producer of content relying on deflationary economics. It produces shows for $500 – 1,000 per minute. It’s no surprise that it has now become one of the most viewed networks of video programming in the world, achieving 500 million video views per month having only raised $3 million in venture capital.

Maker Studios produces shows like =3 by Ray William Johnson (NSFW), one of the most subscribed to shows on YouTube. Many episodes are garnering 8-12 million views while its network competitor (and equally brilliant show) Tosh.O is getting 3 million views.

Other shows like Epic Rap Battles of History (my personal favorite – if you get addicted we’ve produced about 15 or so now. The best ones have been watched more than 35 million times) and Animonsters are delivering huge audiences and significant revenues.

I know that the networks, studios & cable companies don’t yet see this business as a threat. My experience in looking at deflationary businesses says that they should pay attention to it. Deflationary economics tend to eat at the core of traditional offline businesses.

Of course I could go on and on including businesses like AirBnB, DropBox, Box.net, Yammer and so on. All deflationary. But by now you more than got the point.

So What Do I Look for In My Investments?

Exactly what I’ve outlined.

Teams that care about keeping costs low.
Teams that want to drive waste out of the system.
Teams that have a “lean” mentality.
Teams that are comfortable with transparency of pricing & costs and don’t mind competing in that environment.
Teams who aspire to build really big businesses and believe in deflationary economics.
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The Coaching Mistakes You're Definitely Making

Believe it or not, the most intuitive coaching methods are usually the worst. Here are the top five mistakes managers make when coaching a sales rookie.

By Geoffrey James | Nov 3, 2011 Inc.com http://ow.ly/7o0qm

In business, a manager is expected to prepare employees to succeed by providing the resources, tools, and development they need to achieve their objectives.  Unfortunately, many managers have little or no idea how to coach effectively.

I will soon cover exactly how to coach salespeople (based on inputs from best-selling author and sales training firm founder Linda Richardson), but, first, check out the five most common coaching mistakes.

• Mistake #1: Confusing Coaching with Performance Evaluations. Some managers think that the best time to provide coaching is during the employee's yearly performance evaluation.  However, evaluation and coaching are dramatically different animals. Evaluations happen every year or every quarter, while coaching, to be effective, must be an ongoing daily or weekly process. Similarly, evaluations focus on what happened in the past, while coaching focuses on what could happen in the future. Finally, evaluations mean paperwork and bureaucracy, while coaching is, by its very nature, informal and personal.

• Mistake #2: Treating Coaching as Low Priority. Managers have many demands on their time, and they're often forced to focus on the numbers, or their own manager, simply to survive.  As a result, it's all too easy to treat coaching as something that can be postponed indefinitely. Unfortunately, without coaching, sales numbers are likely to suffer and, sooner or later, will gather negative attention from top management, investors, and (worst of all) the customers themselves.

• Mistake #3: Finding an Excuse Not to Coach. Managers who have sold, and were good at it, may realize that the skills to succeed in sales are not the same as those needed to succeed as a coach. Managers who haven't sold for a living may wrongly believe that they can't possibly coach somebody who already knows how to sell. (In fact, anyone who has been sold to can provide valuable sales coaching.)  Finally, some companies just don't have much of a "coaching culture", which means most managers don't get coached and are not rewarded for coaching.

• Mistake #4: Providing Feedback and Suggestions. Many managers coach by telling the person what he or she did wrong, and what to do to fix it.  While this process is time-efficient, most people respond to this kind of coaching by becoming passive-aggressive (quietly accepting but seething inside) or completely defensive (arguing the point). The manager typically fails to get buy-in from the employee and misses a chance to see where the employee is on the learning curve. Worst case, feedback/suggestion coaching damages the relationship.

• Mistake #5: Coaching By Example. This is the worst mistake of all. The manager and the rep go on a sales call together and, the moment it seems as if something is going awry or not according to the manager’s expectations, the manager jumps into the situation and "shows how it’s done."  This type of coaching destroys the sales person's credibility with the customer and, worse, can easily backfire, because the manager may not know the entire situation with that customer.

I hope that nobody recognizes themselves in the mistakes described above. If so, don’t take it to heart. Such mistakes are so common that most sales reps don’t expect anything better. Fortunately, coaching more effectively is easy to learn, as you’ll find out soon.

3 Ways Sales Management Can Make Their Quota

Posted by Dan Perry on Sun, Oct 30, 2011  http://ow.ly/7m66g
57% of all sales reps will make their quota this year.  Sales Management: This means almost HALF of your reps are missing their goal.  Unless you have some unbelievable ‘rainmakers’ on your team, you are probably missing your quota as well.  With the end of the year approaching, most CEOs and VP of Sales are thinking about INCREASING your Sales Management quota for next year.

What are you going to do?

Making your quota for 2012 requires changing things.  The status quo is no longer acceptable.  You have to increase your sales team’s quota attainment.  If your quota has been set properly, the sales reps on your team will need to hit at least 65% of their quota.  This means 6.5 out of 10 sales reps must be 100%+ to quota.

 Can you make this happen without LOWERING the quotas?

You make your number by coaching to your sales process. You make your number by coaching to success metrics (Close Rate increase, Sales Cycle Length decrease etc.)  You make your number by coaching to dealstrategy. 

3 Ways Sales Management can make quota (by coaching):

# 1 - Delivery of your message.  The way you DELIVER your message has a direct impact on the perceived CONTENT of the message.  The way you use effective words and pitch in the message is critical in your point to be taken. Most successful coaches talked at a faster rate than ‘normal’ and their emphasis was is consistent throughout their delivery.  They BELIEVED in their message and the ‘receiver’ thought the coach had their best interest at heart.

      Remember:  You can’t fake confidence.

MIT’s Sloan School of Management had 42 MBA students write and then present a business plan.  The students, all who had previous business experience, were ranked in three areas: persuasion, content and style.  Even though the three areas were ranked separately, if a student ranked HIGH in ONE area, they scored well in all areas.  When separate judges just READ the plans, they chose differently than the judges who witnessed the presentations.

#2 - Situational Coaching.  Don’t peanut butter spread the coaching.  One size does not fit all.  New hires need different coaching then tenured reps.  Average performers are coached differently than Top performers.  You must change your style to the sale rep you are developing.  Assess where they are and use the below chart as a rule of thumb:

#3 - Regular Cadence.  Establishing a fixed schedule that allows you the ability and opportunity to coach at all times is critical. You must be in the field with your sale reps.  This results in situations which you can observe their behavior and develop them.  Use the scenario, their exact words to help them improve on flawed behaviors.  Things like questioning skills, non-verbal communication, adherence to following the sale process etc.  These will improve their productivity. Use this table for guidance:

Sales Management Coaching Situations	Actions Required
Planned One On Ones (in the calendar)	Set an agenda with regular items formally reviewed each session. Sales Rep comes prepared with tools, responses and action items
In the Moment	Coach specifics that were just observed or discussed.  The most critical and impactful of all coaching, this needs to be done on a regular occurrence (Like Daily!)
Scheduled Semi Annual Reviews	Formal sessions discussing long range development usually tied to success metrics (quota attainment) and competencies. You must develop an Individual Development Profile and monitor the progress.

Making your quota is much more than simply filling the team’s pipelines and closing sales.  It is coaching your sales rep and developing them into ‘A’ players.  It is training to the sales process. We work with many sales managers who have ‘jumped off the Ferris wheel of doing deals’ to creating awesome sales reps. 

 One of the most significant sales management changes witnessed is by Brent Babbs. Brent took over a struggling sales team in Chicago moving from ‘A’+ sales rep to sales manager.  Brent carried the quota for the team for many years being recognized as a top sales rep in the company.  When he was promoted, the first year Brent was 99.9% of quota for his team.  Good enough to get his bonus but definitely not practicing the three steps outlined above.  His team made the quota because Brent sold all the deals.  His reps would get him into the prospects and (as one sale rep told me) Brent would take over and close the sales.  He had no turnover in sales reps that year (because they made all the commissions on the back of Brent).

The following year, Brent dedicated himself to coaching his people.  He devoted his time to the steps above and had awesome results (top SM in a company of 65 SMs).  He subsequently got promoted.  He made his sales team quota by not selling all the deals himself but coaching his sales people to sell while he coached them to improve.

Do you exhibit Brent’s early characteristics?  Can you change?  Devote your energy to the 3 ways to make your quota and you will do it!