Evaluating the Performance of Salespeople

Purposes of Salesperson Performance EvaluationsEnsure that compensation is consistent with actual salesperson performanceIdentify salespeople that might be promotedIdentify salespeople who should be terminated and to supply documentationDetermine training and counseling needsHuman resource planningIdentify criteria for recruiting and selecting salespeople

Purposes of Salesperson Performance EvaluationsAdvise salespeople of work expectationsMotivate salespeopleHelp salespeople set career goalsRelate salesperson performance to sales organization goalsEnhance communications between salesperson and sales managerImprove salesperson performance

360-Degree Feedback SystemEvaluated by multiple ratersSalespersons value to the organization and customersConsiderationsQuality dataConfidentialityUsefulNot used exclusivelyInternalCustomersEvaluationExternalCustomersEvaluationOneselfEvaluationSales ManagerEvaluationTeamMembersEvaluation

Perspectives on Salesperson Performance EvaluationOutcome-BasedLittle monitoring of peopleLittle managerial direction of salespeopleStraightforward objectives measures of resultsBehavior-BasedConsiderable monitoring of salespeopleHigh levels of managerial direction of salespeopleSubjective measures of salesperson characteristics, activities, and strategies

Dimensions of Salesperson Performance Evaluation

Criteria for Performance EvaluationBehavior:Activities performed Activities to promote long-term customer satisfactionSales callsCustomer complaintsRequired reports submitted Training meetings Letters and calls to prospects

Criteria for Performance EvaluationProfessional Development:Assess improvements in certain characteristics: traits, skills, knowledge Attitude Product knowledge Initiative and assertiveness Communication skills Ethical behavior

Criteria for Performance EvaluationResults:Measured objectively: sales, market share Possible negative effects Sales quotas

Criteria for Performance EvaluationProfitability:Specific products soldPrices negotiatedExpenses incurredCriteria

Performance Evaluation Methods: Characteristics any method should includeJob RelatednessReliabilityValidityStandardizationPracticalityComparabilityDiscriminabilityUsefulness

Performance Evaluation MethodsGraphic Rating/Checklist Methods Performance evaluation formEspecially useful in evaluating behavioral and professional development criteriaGood on most characteristics, especially job relatedness, standardization, practicality, and comparabilityDisadvantage is providing evaluations that discriminate sufficiently

Performance Evaluation Methods: Ranking MethodsRank all salespeople according to relative performance on each performance criterionThese methods force discrimination as to the performance of individual salespeopleMay be complexRankings only reveal relative performance evaluation

Performance Evaluation Methods: Objective-Setting MethodsManagement By Objectives (MBO)Mutual setting of well-defined and measurable goals within a specified time period.Managing activities within the specified time period toward the accomplishment of the stated objectives.Appraisal of performance against objectives.

Performance Evaluation Methods Behaviorally Anchored Rating Scales (BARS)Links behaviors to specific resultsSalespeople are used to develop performance results and critical behaviorsPositive feedback about behaviors may be more effective than positive output feedback

BARS Scale: Cooperative Relations with Other Sales Team Members Behavioral Anchor Statements Could be expectedto cooperate when aid is requested by other team members.to go out of her/his way to help the team achieve its goals.

to lend a helping hand and can be expected to try hard to help the team.to occasionally support the team on problems encountered in the field

to contribute half-heartedly to the team effort to accomplish goals

not to care much about the team and its members

to antagonize members of the team and pull against the team goals109876543210

Performance Evaluation BiasOccurs when a managers evaluation of a salesperson is affected by considerations other than the specified criteriaCommon sources of bias:Personal relationshipsPerceived difficulty of territoryImpression managementHalo effectOutcomes bias

Framework for UsingPerformance Information

Salesperson Job SatisfactionJob satisfaction related to turnover, absenteeism, motivation, and organizational commitmentJob satisfaction may be related to performance (direction of relationship is unknown)

Salesperson Job SatisfactionINDSALES measures satisfaction with:JobFellow workersSupervisionCompany policy and supportPayPromotion and advancementCustomersResults may identify areas where manager may intervene to improve job satisfaction

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