1. Evaluating Salesperson Performance14
Evaluating Salesperson Performance

2. 4/20/2017
Learning Objectives
Explain the difference between performance and effectiveness
Identify objective measures of salesperson performance, both output and input
Use ratio analysis as an objective approach to salesperson performance measurement

3. 4/20/2017
Learning Objectives
Discuss key issues related to subjective measurement of salesperson performance and the forms that might be used to administer such an evaluation
Understand how a sales manager can make the performance review process more productive and valuable for the salesperson
Explain the benefits of 360-degree feedback

4. Performance versus Effectiveness
Behavior – what people do; the tasks on which they expend effort
Performance – behavior evaluated in terms of its contribution to the goals of the organization
Effectiveness – some summary index of organizational outcomes for which the individual is at least partly responsible

5. Performance Evaluation Measures
Objective measures – reflect statistics the sales manager can gather from the firm’s internal data
Subjective measures – rely on personal evaluations by the sales manager and others

6. Common Output and Input Measures Used to Evaluate Salespeople
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Common Output and Input Measures Used to Evaluate Salespeople
Continued

7. Common Output and Input Measures Used to Evaluate Salespeople
14.1
Common Output and Input Measures Used to Evaluate Salespeople
Continued

8. Common Output and Input Measures Used to Evaluate Salespeople
14.1
Common Output and Input Measures Used to Evaluate Salespeople

9. Ratio Measures Three key types: Expense ratios
Account development and servicing ratios
Call activity and productivity ratios

10. Summary Equations Sales = Days worked X Calls Orders or Call rate
Batting avg.
Avg. order size

11. Typical Attributes on Appraisal Forms
Sales results
Job knowledge
Management of territory
Customer and company relations
Personal characteristics
Note the mix of objective and subjective performance measures

12. Common Problems with Subjective Performance Measurement
Lack of an outcome focus
Ill-defined personality traits
Halo effect
Leniency or harshness
Central tendency
Interpersonal bias
Organizational uses influence

13. Advice for Avoiding Errors in Performance Evaluation
Read the definition of each attribute thoroughly before rating
Guard against tendency to overrate
Be as objective as possible
Do not permit your evaluation of one factor to influence your evaluation of another

14. Advice for Avoiding Errors in Performance Evaluation
Base your rating on observed performance, not potential abilities
Rate an employee on general success or failure over the whole period
Have sound reasons for your ratings

15. BARS Systems
Behaviorally anchored rating scale (BARS) system concentrates on criteria the individual can control
Requires sales managers to consider in detail a wide range of components of job performance
Requires clearly defined anchors for each performance criteria

16. 360-Degree Performance Feedback
Integrates feedback from external customers, internal customers, other members of the selling team, the sales manager, and the salesperson
Provides the impetus for a more productive dialogue between the sales manager and salesperson at performance review time

17. Performance Management System
Requires a commitment to integrating all the elements of feedback on the process of serving customers
Results in performance information that is timely, accurate, and relevant to the firm’s customer management initiative
Salespeople take the lead in goal setting, performance measurement, and adjustment of their own performance