Team goals counterproductive:
Philadelphia, August 10, 1999 —"Rainmakers" are not always the only path to sales success for community banks. The real key to improving banks' long-term sales results lies in increased levels of motivation for the average performers in the sales force, consultant Buck Bierly told participants in a recent audioconference sponsored by RMA, the international association of lending and credit risk professionals.
"Successful sales teams set goals and have visible accountability and monetary incentives," he observes. "While sales and relationship building require specific skills, the key to improving long-term sales is directly related to motivating the average performers who typically make up 80 percent of a sales team. With better levels of motivation, they typically improve their performance by 20 to 30 percent."
Bierly points to eight external motivators that can have a significant effect on the sales performance of the average performers: clearly communicated direction, ongoing guidance and training, challenging goals, immediate feedback on performance, visible accountability, appropriate use of peer influence and monetary incentives.
While Bierly notes that all good salespeople need set goals to be successful, he believes that it is equally important to measure the processes and activities used to produce sales results.
"I have found that the very best high performers not only can produce sales results but they can tell you exactly how they did it," he said. "They have a set of defined processes they use to ensure that they continually generate those results. If people get results but can't articulate the process they use, they won't be able to duplicate those results over time. To be successful, you must measure the sales process and related activities you use to be successful."
Bierly also believes that team goals can be counterproductive to sales performance. "While team results may look good, there are always different levels of performance among team members," he said. "A recent study of team goals demonstrated that over a two- to three-year period, high performers begin to feel they aren't getting adequate recognition for their efforts. As a result, resentment builds and the team begins to break down."
A successful alternative to the team concept lies with a combination of individual and team goals. "For example, if 75 percent of your goals are based on your own performance and 25 percent are based on the team's performance, you tend to focus on helping other team members while also getting the recognition that you deserve," he said.
Bierly believes that setting goals and doing sales reporting leads to a higher degree of visible accountability. "There must be positive consequences for those reaching or exceeding their goals and a downside for those who don't," he advised. "If there are no consequences for the actions of your sales force, goals will be less of a motivator. Further, if there is no downside for not reaching goals, there is no real incentive to change."
An audiotape of the conference is available from RMA's Customer Relations at 800-677-7621.
Bierly is owner of M.Z. Bierly Consulting, Exton, Pennsylvania, and works with regional and community banks on commercial lenders' sales performance.
RMA is the premier international association of lending and credit risk professionals. Its membership consists of more than 3,000 financial service providers. These institutions are represented in the association by more than 18,000 commercial loan and credit personnel in the 50 states, Puerto Rico, Canada, and numerous foreign cities including Hong Kong and Singapore.
For further information: Contact Pam Martin, Regulatory Relations and Communications, at 215-446-4092 or e-mail pmartin@rmahq.org.