3 Principles Leaders Must Follow to Build a World-Class Sales Culture

The biggest challenge a sales team has is hitting and exceeding quota. Important research done by The Bridge Group states that only 67% of reps hit quota, which means roughly 1/3 of inside sales reps are not hitting quota. Regardless of what you think the ratio should be for your sales team, one thing is for sure: if your best reps are not consistently hitting quota then you have a problem. If you have high voluntary turnover, you need to improve the culture.

How can we overcome these challenges?

The research goes on to show that the more tenure your reps have, the higher the quota attainment. Not surprisingly, the data also suggests that the less turnover you have, the higher the quota attainment. In other words, if you can dramatically reduce sales reps quitting, your sales will improve. Your culture needs to be a magnet for the best performers. Success breeds success, and everybody wants to be on the winning team. 

"If you want to improve your results, you need to change the experiences you are creating for your team"

I had the great pleasure to work with best-selling author and co-founder of Partners in Leadership, Roger Connors. Both Roger Connors and Tom Smith are the thought leaders on accountability and culture change. One of the great lessons I learned from Roger is how cultures are created and improved. The good news is that it isn't rocket science; it's actually very simple, and when you see it you will have that 'aha' moment. 

Partners in Leadership describes culture through the results pyramid, which I have below.

What we learn is that everything starts with the experiences that you create for your team. These experiences form beliefs, and the beliefs influence actions, and with actions comes results. Therefore, if you want to improve your results, you need to change the experiences you are creating for your team.

How do you create better experiences?

There are three key principles for building your culture and creating the kind of experiences that increase sales.

1. Team building

2. Recognition

3. Compensation

Team Building is about improving the individual. It's about improving their skills and personal development. When you are willing to invest in your team, they are willing to invest in the company in return. There have been many companies that use activities and adventures as means to develop their sales team. Hiroshi "Mickey" Mikitani, CEO of Rakuten, hikes Mount Tanigawa with his executive team every year. This "non-conventional bonding experience" helps them tackle tough challenges both on the mountain and back at the office.

Whether you are hiking mountain peaks, paint balling, getting drinks, or bowling, these are opportunities to connect. Team-building could also take place in retreats, designed to motivate, inspire, and educate. You might consider bringing in a sales expert to speak to your team; sales reps love to hear from the best, and what they have done to be successful. All of these activities create experiences that will build unity and loyalty in your reps. Team building should not be some thing you have to earn- it's a small investment on the part of the company, and will net a great return in the long run.

"Companies with great culture brand create audacious incentives and give out tons of cash knowing that the return is tenfold."

Recognition is some thing that every sales rep needs. It validates that they are the best, and they want everyone to know it. We know from endless research that sales reps thrive on competition, because they love the recognition, which is why gamifying sales has become so popular. Recognition is more than rewarding them with rich incentives, which is the next topic. It's about validating the top performers in a social setting.

You don't have to spend large amounts of money to recognize your best reps, although it doesn't hurt. It's simply about putting the spotlight on them. When a rep closes a deal, hits quota, sets a record, they should get some form of recognition; this will validate the rep as well as motivate other reps to accomplish the same goal.

Some companies like Yesware play the sales rep's favorite song when they close a deal, while Insidesales.com showers their reps with cash when they do so. You might consider taking them out to lunch at their favorite restaurant, or awarding them with a trophy. It doesn't have to be elaborate- it could be as simple as a company-wide e-mail, or grabbing drinks after work.

 Compensation is very important to sales reps; in fact, most would agree that if it isn't one of the top priorities for the sales rep, it's probably not the right role for them. High compensation, incentives, and bling is how you market your sales team. You don't always have to have the highest compensation package, but results are more important than the actual plan. A high plan that nobody hits is demotivating and can have serious consequences if left unchanged. Compensation plans have to be attainable by your top performers, otherwise nobody is happy, and nobody is talking about the company. 

"Sales reps that make a lot of money also love to talk about it, which is a good thing, as you won't need to spend as much on recruiting, and you will get the best candidates"

Companies with great culture brand create audacious incentives and give out tons of cash knowing that the return is tenfold. You do this because it's the cheapest form of marketing for your sales team, and it will draw top performers from other companies. InsideSales.com awarded top performers at their annual sales kick-off with rolex watches. None of the sales reps expected this, but the message was very clear: InsideSales values its sales team.

It's crucial that you don't get caught in the trap of thinking you're paying your reps to much. Sales reps that make a lot of money also love to talk about it, which is a good thing, as you won't need to spend as much on recruiting and you will get the best candidates. On the contrary, research suggests that turnover in sales can cost upwards of 200% of an employee's annual salary. It's much more expensive to replace employees than giving them a bump in compensation.

A culture that focuses on these experiences will begin to get the results they target. They will see voluntary attrition go down and revenue go up- thats a trend that every company can appreciate.

What does your team do to build culture? Please comment below.