Is it time to stop looking in the rearview mirror?

Take a moment to think about driving your car from a known to an unknown point. Do you drive with both hands on the wheel and looking backward using the rearview mirror only or do you drive forward with occasional looks in the side mirrors for potential obstacles?

Even with global positioning systems (GPS), many still use printed maps to get the 30,000 foot view of their forthcoming travels.  If they are traveling from Chicago, IL to Denver, Colorado, do they really care about the states to the east of Illinois?  No! They are looking to the west, forward to see where they are going so if they need to make a course correction (overcome a known or even unexpected obstacle within the sales process), they have a far better idea of what specific action steps to take.

Applying this sales metaphor (see last month’s blogs on this topic), have you invested the time to look at the big picture such as industry trends, local to national issues affecting your potential customers? Are you keeping up with your current sales statistics? Or have you been as often quoted by Michael Gerber far too busy working “in the business and not on the business?”

Now some may argue, Leanne, what about last year’s sales numbers?  You are ignoring critical information!  If you made last year’s numbers, then why should you not be able to meet this year’s?  And if last year was challenging, then you should have invested the time to set a new sales action plan at the beginning of this year. This action alone would have suggested you have already made the necessary course corrections.

Also, I never suggested not to ever looking in the rearview mirror, but rather do not do it when your goal is forward progression.  This behavior is necessary when parking cars.  If your sales are not where you need them to be, then maybe it is time to park your car and truly study your MAP (my action plan).

Research from Kellogg School of Management and a MIT study) this also suggests today’s top performers must have a very effective contact management system and a process for follow-up.  This works even better when those entering the “sales funnel” are pre-qualified according to these qualifying criteria:

• Decision maker
• Identified need or needs
• Allocated budget
• Demonstrated urgency
• Commitment level

Additionally, when professional sales people engage in rearview driving, they are demonstrating far more reactive behaviors instead of proactive ones. This reactive behavior is one of the major differences between average salespersons and top sales performers.

Another problem with rearview driving it places you in the sphere of what’s beyond your control.  No one can change the past for time once experienced never returns. Each day has a finite number of seconds, minutes and hours.  This is why time should always be considered as an investment in a limited. Sales Training Coaching Tip:  Time management is an oxymoron because no one can manage a constant.

In life, be it personal or professional, there exists 3 spheres. The innermost and smallest one is what you can control.  Moving outward, what you can influence is the next circle. This is a little bigger than What You Can Control.  Finally, both circles reside within the largest and third circle of What You Cannot Control.

When we think about the sales process, the economy, the interactions with people, how much of our time is truly devoted to what we cannot control or influence?  What would happen if you just transferred just 10% of your energies focusing on What You Cannot Control to What You Can Control?  Would you begin to see improved sales results?

Now is the time to MAP the next 6 months.

• Review the terrain and road conditions
• Check your car to make sure it is properly serviced
• Maintain your car as you travel up and down all of those “Selling Roads”
• Leave the rearview mirror for others and those occasional times when you must park your car.
• Use the mile markers as your daily benchmarks.
• Write down your mileage
• Monitor your sales statistics

By taking these proactive actions all of which are under your control, you will probably arrive at your destination early (made that sales target) and with the expenditure of  far less resources.

There is a temptation to propose a low salary with a juicy commission plan.  But when you are entering new foreign markets, this is not usually a good option if you are serious about developing your international business.

The main problem is that commissions are based on percentages and numbers.  When entering a new market it’s hard to come up with good numbers.

But that’s not all. There are a few things that come into play related to the international aspect of these sales. Here are two of the differences you need to take into account when coming up with a good compensation plan to drive sales performance in a new foreign market.

Your Sales Person Wears Many Hats

It’s true in all markets that salespeople where many hats, but when selling to new international markets your salesperson also has to adapt your sales and marketing tactics to a different culture.

Whether your salesperson is from the local market or is from your home country, he still goes through a period of adapting to being the connecting point between two different cultures.

Most companies find they need to adapt their original sales and marketing tactics when they first start selling in a new country.  There is almost always some adaptation needed to come up with a good sales strategy.

This takes time.

And it also takes teamwork with the home office.  This means he’ll spend more time wearing different hats than if he was selling to a market feedback cultural adaptation.

This takes up even more time.

And the trouble is: no one can really estimate just how much time this will take until you have been selling to your new international market for a while. You want to make sure you have the right person doing the job for you.

Cultural Differences In Compensation

Given that he already has so much to do, you have to make it easy for your salesperson to fit in well within his environment. Different cultures have different sales practices and you need to make sure your compensation plan works well to drive sales in this environment.

There are many different types of cultural blunders linked to expecting one sales compensation plan that works in some countries to work well in other countries.  And it’s not only a question of knowing where bribes and where they are illegal.

• There are countries where commission-only based sales do not work well simply because the legal system does not make it an attractive or easy set up to work with.
• There are countries where not having a company car is not a good sign.
• In some countries payment of overtime is expected and in other countries there is a certain level of tolerance for non-payment.

Even if you think compensation information is between you and your salesperson, the other people he comes into contact with will probably notice any different practices.  This includes your potential clients.

And this is where funny things can start.  People from different cultures can make wrong assumptions that impact how your company is perceived.  Salespeople who earn big commissions because they are successful are usually proud to show this in North America for example.  But this is not the case in other countries.

Two Step Approach

You don’t want to create any cultural blunders when you first set up your compensation plans for the first salespeople you hire to open new international markets. This is why you will probably look at a two step approach. In the first step:

• Companies with little budget and only focusing on immediate sales will try a compensation plan based on large commissions or a commission-only plan… in markets where the legal system makes this easy to do.

• Companies focusing on sustained international business development will invest in a salesperson capable of wearing many hats and helping them adapt to a new market. They will probably pay him a fixed salary and maybe a smaller commission at the end of the year.

Once businesses become familiar with cultural differences in what works in driving more sales, they can evaluate how best to set commissions and sales targets for an all round win-win situation.

I’ve worked for a few North American companies setting up European offices to develop more European sales.  There was never a sophisticated commission plan to begin with and targets were only set as guidelines.

There was always a good level of flexibility in the first 2 years.  This was the average length of time needed for the North American home companies to learn about their new market, including how sales were made abroad and how to adapt to the differences.

But there were always weekly calls to a senior executive in the North American home office.  These weekly calls made it possible for North American management to stay current on all activities including actual sales results and expectations.

There is no best way to set up commission plans and targets for all new foreign sales offices.  You need to know the sales environment to learn what works best and this takes time.