How to Set Sales Goals That Really Motivate


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How to Set Sales Goals That Really Motivate

Uncategorized Mar 09, 2021

 If you or your sales team are responsible for revenue in your company, you know that sales goals and comp plans can have a huge impact on the profitability of the organization and the performance of your team members.  We all know that having a goal helps us achieve more than we would without it.   

How do you set goals in a way to motivate performance and create alignment so that everybody in the organization can rally around a shared goal that they are bought into and engaged with?

Join me for this episode, where I tackle the critical question of how to set goals that really motivate and how to align compensation strategies so that you can get the biggest bang for your buck and create true motivation from your team members. 

In this episode, I talk about:

  • Importance of setting a challenging, but realistic goal. 
  • Three things to look at when setting your sales goal.  
  • How to set a compensation plan. 

Plus much, much more, including the three keys for getting your team engaged and motivated.  

Show Notes:

  • [01:33] So we all know sales goals have a huge impact on the motivation, engagement, and retention of your sales team.  Oftentimes as a small business owner, you are challenged with setting a sales goal.  
  • [03:31] Just because you want that number to happen doesn’t mean it is going to happen.  
  • [04:17] If you get the number wrong, it can have a huge negative impact on your team and on their performance.  If you make a goal too easy people won’t be motivated.  If you make a goal too hard people give up before they start. 
  • [04:37] We want to find that sweet spot between a goal that is challenging and realistic.  
  • [05:30] First, you need to evaluate what is the right type of goal and what is the focus of the organization.  You need to tie your primary goal for your sales team to the primary goal of the business and the strategic initiative.  
  • [06:26] The first thing you need to do when you are putting out your strategic sale plan is to figure out what is the most important initiative.  Once you have that what is the best way to measure that for your sales team and for the organization.  
  • [07:30] For the purposes of strategic planning you want to break it down by at least every quarter and every month.  
  • [07:41] When setting the sales goal number, the first thing you want to look at is trends.  
  • [08:29] The second thing you want to look at is market trends.  Then look at what are some outside influences that could affect the existing growth rate.  
  • [09:25] Once you have looked at your current trends, what the market trends are, what outside influences are happening that might impact those numbers, and then also account for what phase of business you are in you can start to settle in on some numbers based on data.  
  • [10:06] If your goal is not realistic and challenging, it is not the right number regardless of what your PNL says.   
  • [10:35] The team has to believe that they can win.  When you are transparent and you share how you came about that number and why the number is what it is that you can get a lot more buy-in from your sales team.  Buy-in is critical to performance.  
  • [13:12] Figure out based on attracting and retaining high-quality people within your industry specifically what is your target earnings for that individual.  
  • [14:06] We don’t want to be paying out so much in commissions that we are not actually making money on sales.
  • [15:31] Play with the numbers to see what is going to get you in the target earning potential but keep you in the profitability based on your total cost of goods sold. 
  • [15:57] She recommends paying bonuses on a quarterly basis.  You want to have some room for people to have consistent performance but a short enough period that people are motivated.  
  • [18:44] It is absolutely okay to put a cap on your commission plan, but there is a cost of doing it.  Research shows that caps on commission actually decrease performance.  When caps are removed sales performance and profitability go up. 
  • [19:58] First and foremost keep the goal challenging, but doable.  If you do that for your goal setting you are going to have an engaged, motivated, and high-performing sales team.
  • [20:17] Keep it as simple as possible.  The simpler and cleaner you can keep it the easier it is for you as an owner and also the easier it is for your sales team to align around a shared vision and goal.  
  • [21:13] Be transparent.  Share how you came to the number and why.  The more people know about the why behind things the more they get invested in things.  


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