A Numbers Game by Ari Rosenberg , Thursday, August 7, 2008
It's tough going right now for many publishers. You can feel the stress and anxiety levels rising when you look at revenue numbers not being met. And the numbers are everything -- so what can you do to get better, faster, than your competitors?
Start with your numbers. Not your sales revenue numbers, or sales call volume, but your quotas. If the annual goal is out of realistic reach as you roll into August, you need to look at how this goal was arrived at, rather than the failures of those paid to reach it. It is easy to assign blame to the sales force when quotas are missed, but they only own 50% of the problem. You create quotas through feel and intuition -- and when this number is cooked up incorrectly, it can poison your entire company.
The misconception is to set your revenue bar high enough so when it's missed you can still meet your internal business plan. This approach is based on achieving success through failure. If the annual team quota is set with this approach in mind, but without accounting for a market downturn in spending, the gap between booked revenue and the goal becomes much larger than internally anticipated. In these cases, the material impact of extreme failure can derail an entire company -- all because the goal was never achievable in the first place.
If you are asked to run a race you can't win, at some point, maybe as early as mid-August, you stop running hard. A finish line has to be in sight in order to maintain positive sales momentum, momentum that drives the morale of your entire company. Salespeople with annual quotas out of reach at this point in the year will feel the weight of failure on their shoulders. Many will look to cover their tracks or for another job. And before you know it, the exertion of energy towards things other than growing your revenue seeps into other areas of your company. All because the finish line we all crave to cross, cannot feasibly be met.
A downward market dramatically increases competition, so you need to earn your wins left to win in 2008. To do so, you need to maximize the efforts of a sales force, and moving the finish line closer will make that happen -- more so than leaving it be. It may take more work, more calculations and more internal communication, but I would suggest altering the current commission plan, and dispensing new goals that can be reached, even if only a few manage to do so.
And do so with humility. Own 50% of the issue and offer back a solution your sales team will buy into. Then watch them run harder and faster for the remainder of this challenging year. Your company will finish better and stronger than if you did nothing at all.
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