Sales – Are Stretch Goals about Outcomes or Refining Processes and Creating Better Strategies?

Sales involve understanding how your products/services affect customer outcomes while building a sales strategy to establish how this value is recognized. This requires understanding customer needs and how your product or service can address those needs. It also means clearly understanding your “value proposition” – what makes your product or service unique and valuable to your customer. With this understanding, you can craft a sales strategy to communicate this value to your customers effectively.

In order to create a sales strategy that is complete and accurate, you need to take the time to learn about the customer’s situation. This means understanding the different inputs that go into their decision-making process. In any situation where you are trying to understand or predict a particular outcome, it is important to consider all possible inputs that could affect it. Even if you have an accurate view of all of the information, you still need to discover how they interact with each other to produce the desired outcome. This can be a difficult and time-consuming process, but it is essential to understand any complex system.

We often devote attention to the outcome instead of the strategy because we incorrectly assume that the outcome is more important than it is. The reality is that the strategy is more important than the outcome because it is the strategy that determines the quality of the outcome. We can learn how to improve the outcome by focusing on the strategy. When we believe that the outcome reflects our limited ability, we judge it as an evaluation of ourselves. So we focus on performance rather than learning goals, to our detriment. Our focus on performance can lead us to miss important opportunities, and it can also lead us to feel anxious and stressed. Focusing on strategy instead of performance can better achieve our goals and feel more confident and relaxed.

Sales is a notoriously difficult and unpredictable profession. To be successful, it is important to have a model or mental framework to help distinguish signal from noise. Without such a model, outcomes can change our interpretation of events. If the outcome is positive, we may view the process as good, but if it is negative, we may view it as bad. A model can help us see the big picture and make better decisions. When we try new ideas that don’t work, we may want to change our perspective on the process that produced those results. Alternatively, it may be that the process was right, but we were unlucky. When we succeed, the process is likely to experience a halo effect. When we fail, we tend to second-guess ourselves.

Carol Dweck has shown that individuals tend to hold one of two views about intelligence: that it can always be improved, known as a growth mindset, or that individuals are endowed with a certain fixed amount of intelligence. A growth mindset is associated with greater resilience in the face of setbacks and a greater willingness to take on new challenges. It is also associated with greater success in achieving goals. When it comes to success, those with a performance mindset believe it is a direct result of intelligence. If they fail, it is due to their lack of intelligence. On the other hand, those with a growth mindset see failure as simply one input among many regarding the state of the process and their learning. This allows them to view failure as an opportunity to learn and grow rather than a personal shortcoming.

To create more value in performance management techniques, companies are also attempting to incorporate process measures into their evaluations. After collecting data showing that more than half of executives find little value in their performance management techniques, companies are looking for ways to improve the process. By incorporating process measures into their evaluations, companies hope to understand better how their employees are performing and what areas need improvement.

For example, A major consulting firm has made its performance reviews more frequent and used more process-focused questions to move away from outcome challenges and improve learning. This has helped the company to identify issues early on and provide employees with more opportunities to improve their skills. The new process has also allowed for more accurate feedback and increased transparency and communication between employees and managers.

How do you evaluate your salespeople? Are stretch goals about outcomes or refining processes and creating better strategies?

Reference: Never Stop Learning: Stay Relevant, Reinvent Yourself, and Thrive by Bradley R. Staats, Published by Harvard Business Review Press June 5, 2018.

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