Getting SMART with Your Sales Goals
Achieve Results by Setting the Right Sales Goals
Sales is all about achieving results, but how are you going to get there? Reaching a destination requires directions, and achieving results requires goal-setting. After all, how can you track your progress or celebrate success if you don’t know what you are hoping to accomplish?
Goal setting improves performance: One 2015 study by psychologist Gail Matthews at Dominican University revealed that participants who actually wrote down their goals performed 33% better than those who did not. The world of psychology is filled with similar findings which emphasize the connection between goals and performance. And while this statement rings true for pretty much anything in life, it is especially relevant for sales. Setting the right goals will motivate and engage your sales team. It will also help them track their success, and keep them aware of and accountable for their progress.
But setting the right goal can often be just as difficult as achieving it. Goals that are unrealistic or unclear will potentially have the opposite effect of what you hoped for: They are great for discouraging and disengaging team members. Luckily, the SMART goal-setting framework makes it easy for you and your team set clear and effective goals that will continue to motivate, inspire, and improve performance.
The S.M.A.R.T Goal-Setting Framework
Below is a breakdown of the characteristics SMART goals consist of, and some SMART vs not-so-smart goal examples.
Specific: Objectives should be clear and concise.
Measurable: There must be some operationalized way of measuring success in achieving said goal.
Achievable: Goals should challenge the individual, but need to be kept realistic.
Relevant: It is important that the individual is able to see the connection between this goal and their current position, as well as their long-term goals/plans.
Time-bound: Due dates and a well-thought timeline are a must.
A SMART Goal Example: The Right Way
Picture this: You’ve just been hired for an exciting new sales position. Upon being hired, you meet with your sales team leader, and the two of you sit down to talk goals. Luckily, your new boss knows about the SMART framework. The goal you agree on is this:
In the next 3 months, you aim to close at least 5 deals within your dedicated region that are worth $1,000 to 5,000 each in net profit. You and your sales manager will hold intermediate progress reviews each month.
Let’s walk through what makes this a SMART goal:
Specific: 3 months, 5 deals worth $1,000- $5,000. You can’t get more specific than quantitative figures.
Measurable: Another great thing about quantitative goal-setting, it’s already operationalized. Money makes an easy metric.
Achievable: This is a general example and we don’t know the reality of this particular company, however in most companies across industries, 5 deals in 3 months seems like a realistic and achievable goal.
Relevant: This goal is completely relevant to a salesperson’s field of responsibility: It is a direct duty of the position, you are not being asked to do something outside of your scope of responsibilities.
Time-bound: The timeline is made clear: There is a deadline of 3 months which will be maintained with monthly reviews.
A Not-So-SMART Goal Example: The Wrong Way
Unfortunately, confusing and ambiguous goals are all too common in the world of sales (and in general). I’ve definitely witnessed quite a few in my own experience. So let’s imagine the same scenario as above, but instead, you and your new boss decide on this goal:
You aim to double the company’s revenue by implementing an innovative, efficient sales strategy.
This is a ridiculous goal in more ways than one. Again, let’s use the SMART framework to break it down:
Specific: It’s extremely vague. What does “innovative efficient sales strategy” even mean?
Measurable: You have not been given insights into what the company’s revenue even is, so how can you quantitatively measure your success?
Achievable: Is this even possible for one person? How is the company planning on supporting you in achieving this?
Relevant: Is your actual role responsible for the increase of the entire revenue?
Time-bound: There is no clear timeline or deadlines. Expectations are not clear- Is this your goal for your entire time at this company? Your goal in a year? 5 years? WHAT?!
Long Term vs. Short Term Goals: They Both Matter
Now that you (hopefully) have a clear understanding of the fundamentals of SMART goal-setting, I want to emphasize the importance of establishing and tracking BOTH long-term and short-term goals.
Many sales teams make the mistake of focusing only on long-term, usually quarterly or yearly, sales goals. But this is a mistake. Small, incremental goals are also a critical part of motivating your sales team and ensuring you are all on the right track to achieve any long-term goals. They provide important for helping you identify what small steps you need to be taking to achieve a large goal and provide opportunities for you to reflect on what’s going right and wrong.
As a sales manager, you should be meeting with your team regularly to go over company and individual goals. Team meetings where you discuss short term goals should be held regularly- as a way of tracking long-term progress. Going over long-term goals can be less frequent but is equally important. Everyone on your team must have a crystal clear understanding of what their long term goals are and how their short-term goals are contributing to their achievement of said goals.
Short term goals include:
Daily-to-dos: What needs to get done today? In B2C, both daily and weekly goals can be connected to closing deals, whereas for B2B daily goals/to-dos are more about getting you closer to achieving your monthly or quarterly goals.
Weekly: Discuss weekly goals with your team, and what needs to happen on a daily basis to make them happen.
Long-term goals include:
Monthly or Quarterly: Sales is all about the numbers. At the beginning of each quarter set clear quantitative goals with your team. Check-in monthly about the progression of these goals to avoid last minute stress. A successful month or quarter means completing (or better yet, surpassing) these goals.
Yearly: Where do employees see themselves in one year? Five? Ten? It is crucial for you to make a strong and salient connection between what they are doing on a daily, weekly, and monthly basis to what they are hoping to achieve in the grand scheme of things. If you fail to help your employee make this connection, they will struggle to stay motivated.
Goal Setting for B2B vs B2C
It’s important to note that the structure of goals varies across B2B or B2C. Obviously, the type of goal you or your team are setting depends greatly on your specific industry and workflow, but here are some general differences between the two business systems.
Those of you in a B2B industry know that closing the average deal is a long-term process. In this case, there is simply no point in sales managers checking in on lead conversion goals and planning on a daily basis. Instead of short term (daily or weekly) B2B sales goals are about tracking your progress and getting you closer to your long term goal: On a daily or weekly basis, your B2B sales goals should involve consistently improving leads by doing research for richer insights on your prospects. For B2B, look at your short-term goals as inching you closer to your monthly or quarterly goal of converting your lead.
Sales in B2C settings are different: Short term and long term goals in this industry tend to be much more similar. The sales cycle is usually significantly shorter, meaning that multiple sales in one day is entirely possible. Short term goals for B2C salespeople should reflect these differences: Daily goals can, and should, be connected with actually closing deals. You should have enough insights on your daily and weekly sales to set quantitative goals each day.
No matter what industry you work in, setting a goal is the first step towards achieving results. As a sales leader, you play a big role in helping your reps set realistic and motivational goals for themselves. Regularly check in on how they are feeling about their goals and the progress they are making. Yes, goals are a way to keep employees accountable, but their main purpose is to help achieve success. Do not be afraid to revisit and revise goals that are not working. Once you and your team have mastered the art of setting effective goals, achieving your goals should be much easier.
Originally published here.
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