Business Guides

When Are Sales Metrics Useless?

Beverly Flaxington is a practice management consultant. She answers questions from advisors facing human resource issues. To submit yours, email us here.

Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.

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Sales Metrics
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Dear Bev,

I am charged with sales in a large investment management firm. I’ve been here many years and have always made goal. I’m not much of a planner – I know where the opportunities are and I go after them until I can close them. I’m very tenacious and dedicated.

Our firm just brought a sales manager in from the brokerage world. He is starting to implement more stringent requirements around how many calls we have to make each day, how many meetings we have to have in order to plan a trip and things like this. I understand this approach. But he wants to weave results into our bonus program. So, if I were to go to meetings out of town, but I only had two scheduled instead of the five he wants, I would not get the full amount of comp, even if I close one of these two situations.

This seems like shooting ourselves in the foot. If the assets come in and it is good business, what difference does it make whether I visited with 15 people or one person? What behaviors are we rewarding? I have had conversations with him. I’m not shy about stating my opinion, but he is steadfast in his approach. He claims it was the secret sauce that helped his teams be #1 in his former firm.

What’s your opinion? I’m not happy about it, but if I am wrong about my viewpoint, I am open to another perspective. I believe in rewarding people on results, not process.


Dear T.D.,

Don’t pursue a career as a math teacher in middle school. I remember how frustrated my kids were when the teacher gave them a bad grade, even though they got the right answers, if they did not show the process and steps it took to get to that answer! Similar thought here – this person is interested in process: Doing the “right” things repeatedly and getting a rhythm that would carry you through good times and not so good times.

Your question is whether I agree with it. I’m going to sound a bit wishy washy in my answer, but having run sales teams, coached sales leaders and having “carried the bag” for many years, I have viewed this situation from many different perspectives.

I’m not a fan of assigning numbers and targeting people to those numbers. I’ve watched people who “have to make 10 calls a day” just dial their phone, log the 10 calls and then go back to their day. It’s easy to get focused on the number rather than the outcome.

However, in-person visits can be a different measurement. It’s expensive to travel, so you have to do it judiciously. That said, does it make sense to say you have to have five meetings instead of saying you have to have meetings worth X amount of potential? I once had a boss who was of the latter mindset. We had to schedule 8-10 meetings. He sent the president of the company to travel with me on a trip. I made my requisite meetings and the president came back and said how poorly I had qualified the people with whom we met. Of course, because I was focused on just getting the meeting, I couldn’t worry as much about whether they were going to buy from us or not! Coincidentally, I ultimately closed one of the biggest deals the company had ever done from that visit. There is something to be said for simply showing up!

Read the full article here by Beverly Flaxington, Advisor Perspectives