You probably hear the word "Objectives" all the time at work, on TV, or from your friends – but what exactly does it mean? How can we transform something so abstract into something more concrete? What does this have to do with sales commissions?
Clearly defined objectives are an essential part of driving a high-performance sales team for a few reasons: it gives them direction within everyday work, and it also keeps them motivated and competitive with themselves and their fellow sales reps.
Without establishing and implementing objectives, there's no definable metric or goal you can measure growth against and report to your peers.
Objectives are the rubric that defines desired actions and behaviors, and what you'll reward your sales reps for when planning a sales compensation plan - more so than the best times to pay sales compensation.
This is why it's crucial to have well-defined company objectives, translate those into short- and long-term goals, and analyze who and what can help you reach those objectives.
What is an Objective?
Company objectives are the goals and outcomes you hope to achieve, whether it's a year from now or twenty. Building a list of business objectives creates the foundation that guides and directs the rest of your planning, actions, and responses. It's not enough to figure out objectives; you'll also have to accomplish them.
If your company doesn't have a defined set of objectives, you'll want to get as much perspective into this process as possible. Ask yourself questions like: What do we want to be known for? What can we do better? What are our competitors doing?
General company objectives could be to increase profitability, boost productivity, improve customer service and customer experience, lower employee turnover, instill and uphold a positive corporate culture, or even reaching more of the right customers. You want to accomplish objectives as immediate, effective, and straightforward as possible – but, depending on who and how they've developed, that's much harder than it sounds.
The Hierarchy of Goal-Setting
The key to creating a successful set of company objectives is to develop a clear hierarchy of goals. Designed by American author, psychologist and professor Angela Duckworth, this system works from the top-down by defining a few, overarching capital-G "Goals" that your company wants to work toward. From here, you can define mid- and lower-level goals that provide stepping stones in the right direction (to the top of the hierarchy) so you can reach your company's goals.
Reaching these upper-level goals requires an aligned hierarchy of goals. Lower-level goals are a means to an end or something that helps you accomplish your mid-level goals. For example, a goal could be contacting 1,000 prospective customers a month and having weekly team meetings. This is easy to track and measure with sales tracking software, generating reports, or creating dashboards of performance.
By completing your low-level goals, you can better accomplish your mid-level goals, like meeting projected sales targets, surpassing your forecasted quotas, or acquiring X new clients each month. Your objectives will sit at the top of this goal-hierarchy, and define your long-term missions, like increasing market share or improving cash flows. Defining the lower- and mid-level goals creates a set of instructions to successfully execute and succeed as a sales team, manager, and department.
The best place to start developing your objectives is by looking at your company's core values and mission statement. This will ensure that your actions and objectives align with your company's identity, mission, and purpose.
It's also a good idea to talk to other people in your company – the more collaborative, the better. Go to the IT department, speak to the customer service reps, and listen to the finance director bout their own division goals and insights.
No goal or objective is unreachable, as long as you can outline what steps you will be taking and repeating, to get there. It's easier to track and identify areas of needed growth with the proper tools – software that contains historical company data, and data analytics or reporting software that sheds insight on your company's strengths and weaknesses.
When setting objectives for sales reps being able to provide visual feedback through leaderboards, dashboards, and reports will have a profound impact. Having software ready to measure and track progress automatically is key to goal completion. It's not a matter of calculating ROI with excel spreadsheets anymore... it's easy to track progress (or lack thereof) with intelligent and insightful tools that set you up for success.
A SaaS-based system, Performio has saved more than 500,000 administrative hours and calculated more than $3 billion in commissions. Performio's sales tracking software provides easy-to-read interfaces so that data entry, making corrections, and understanding analytics dashboards are easy to generate and understand.