Give Sales People the Responsibility of Setting their Own Targets; and Reward them accordingly

Does the idea sound too disruptive?

Almost any organisation is setting sales targets in a top down way. An executive committee is deciding the next year’s organisation target and then sales management is responsible to split it and set targets for each individual sales person.

Sales management should have a process that identifies and allocates the target level for each region, vertical or even target customer. As you may imagine that for this exercise to be correct and the split of incentives fair, the company must establish tested and validated methods for target allocation.

We all know that the high turnover of sales people in an organisation has mostly to do with the incentives scheme. Either the payout, the targets or its mechanism, are usually areas that upset sales people.

Sales targets are usually one of the main reasons for sales people to leave their job.

Assuming that sales people are those that know and understand the region they sell to much better than anybody else, its dynamics, the challenges etc. they must be the best to know objectively the potential in terms of revenues this region has.

Why then not allowing them to setting their own targets?

It is just a matter of trust I guess!

There is though an answer for that if you have doubts.

Reward them if they have set a target and they succeeded it. If it deviates a lot from what they set punish them. This way makes them responsible not only to set the right target but also achieve them. If they set low target level (because they know they will reach them) you can pay them a smaller tier commission so they are not motivated to do that.

Better to have happy sales people that bring any target, rather than having sales people demotivated because they cannot reach the crazy target someone sets for them.

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