Develop Your Competitive Edge with 360 Feedback
a case study
by Larry Cipolla, CCi Surveys International
Okay. So you are already competitive. Your company has a great reputation. You have a solid share of the market. Your products and services are superior. Your customer service is excellent. You're gaining new customers every day. Your sales results are exceeding all targets and expectations.
Well maybe this doesn't quite describe your company. Maybe you do need to be a bit more competitive. There are many ways to do this, of course. One way is to assess the current effectiveness of each sales person, not by looking at spread sheets, but by asking your customers for feedback about your sales people.
Case Study
Feedback Results
Feedback and Follow Up Actions
360-degree feedback ...
the breakfast of pro-active people.
Some people would ask, "Why bother implementing a 360 feedback process, especially with your customers, if you are meeting your sales goals?" Others would ask, "Why not?" Performance based feedback can provide you with excellent insights about the effectiveness of individual sales people as well as groups of sales people. Perhaps you will be able to exceed your goals without having to cut costs or services or personnel or raise prices or offer special incentives to your customers (or your sales people).
360-degree feedback can help you identify what the current strengths and developmental needs are for each of your sales people, from the customer's point of view. It can help you identify and understand what each sales person may need to do differently to become more competitive with specific types of customers. It can tell you what each sales office or sales region may need to do differently overall and with specific types of customers or with the different types of products and services you market.
Market research studies can provide you with a plethora of information about whatever it is you want to know. You can also accomplish the same results for less money, within a quicker time frame with 360 feedback, than you can with market research or with only a customer satisfaction survey.
A Case Study
Recently, a client wanted to assess the effectiveness of their sales force through one of our 360 feedback surveys-Sales Development Survey. This company marketed four different product lines to their original equipment manufacturing clients (OEM's). Each year they spent approximately $1,000,000 for market research type surveys and studies.
Our Sales Development Survey allowed the client to receive feedback on each sales person from the sales manager, the sales person (participant), and the customers within that sales person's territory. Normally, our clients expect feedback from about 12 customers for each sales person. This client requested feedback from a maximum of 40 customers. They were selected by both the sales person and sales manager.
Each customer completed one survey on their sales person. A cover letter, signed by the National Sales Manager and President of the company, was sent to each customer, prior to deployment of the survey through our web-based application software. All completed forms were returned directly to our processing center, not to the client or sales person.
Each of the 308 sales people, were required to group their customers into eight groups, with at least four customers per group. The customer groups were created based on a specific set of criteria-product line and average dollar volume purchased through the sales person over the last three years. For example, the Customer A Group included only those customers who purchased Product A and only if they averaged over $50,000 in purchases each year. The Customer E Group only included those customers who purchased Product A and only if they averaged between $25,000 and $50,000 in purchases each year. The Customer H Group included those customers who purchased less than $25,000 per year, regardless of the product.
Sales people with less than six months with the company were not included. Sales people with more than one year, but less than three years, used an average dollar volume for the time they were managing their territory.
We implemented to all sales regions at the same time. Customers were asked to complete their responses within three days. The average response time was four days. Sales Managers who had to complete eight to ten surveys, depending on the number of sales people reporting to them, were given up to three weeks to complete and return their surveys.
Our Sales Development Survey, which was the first 360 feedback survey marketed in the USA expressly designed for sales people and account executives, measured 70 items linked to one of eleven competencies.
- Verbal/ Written Communication
- Listening Skills
- Presentation Skills
- Handling Concerns
- Integrity and Image
- Personal Initiative
- Product/Market Knowledge
- Problem Solving/Creativity
- Timeliness
- Customer Service
- Developing Partnerships
In addition to gathering feedback on the individual sales person, the client also used our Leadership Assessment Survey to assess the strengths and weakness of their sales managers. There were a total of 30 managers included in this assessment process. The survey measured 96 behaviorally written items linked to sixteen skill competencies.
- Initiative and Risk Taking
- Personal Integrity
- Vision
- Quality of Results
- Empowerment
- Communicating
- Delegating
- Motivating
- Coaching
- Planning and Goal Setting
- Problem Solving and Decision Making
- Creativity and Innovation
- Technical Competency
- Diversity
- Team Work
- Mentoring
The purpose was not only to establish the manager as a role model for giving and receiving feedback, but also to create more of a real sales team, where everyone felt more comfortable providing performance based feedback to one another.
The Feedback Results
The results were a little different than what the client had anticipated. What they found, among other things, was that the smallest accounts, the Customer H Group, were not being called upon as often as the sales managers assumed. Several sales people admitted that they preferred to focus their time on those customers who purchased the most product and who had the most potential. They did not always want to spend their time selling smaller quantities to smaller customers. In addition, many other sales people were not selling their customers the same product for different applications or different products for new applications. In short, they were not cross selling, nor penetrating their accounts as effectively as they could.
The organization realized that if all these smaller accounts purchased just five per cent more, the total would add up to a very significant amount. The sales people realized that they were missing a lot of new business and, of course, commissions, by neglecting these smaller accounts. All realized that if they weren't selling product, who was? Their competition that's who! The organization took action - immediately.
Feedback and Follow Up Actions
First, all sales people created self directed action plans to resolve their top three developmental needs. Not every sales person had three areas to work on, nor had sales performance problems with their smallest customers. Likewise some sales people had many more than three areas to develop. Each sales person had the responsibility of sharing their action plan with their boss, who suggested relevant changes and made recommendations where necessary.
Follow up meetings with the sales manager were scheduled at no more than 30 day intervals. These meetings were designed to monitor progress, provide coaching, and to reinforce the link between the feedback, sales activities, and developing their competitive edge with not only these smaller accounts, but all accounts in their territory. The results proved to be very rewarding. There was a greater penetration within their accounts overall. Sales overall increased six percent within the year, while sales to the smaller accounts increased 15 per cent within that same twelve month period.
Second, the feedback helped identify potential mentors, other than the sales manager, who would be responsible for getting the newest sales people more effective, sooner. These mentors were assigned to newly hired sales people and other sales people who wanted additional ideas about how to become more effective with the customers. As a result, there was a dramatic improvement in sales performance among the more recent new hires.
In the past, the client considered the first year as a learning experience for each newly hired sales person. By the end of this period, each sales person was expected to produce sales, know their competition and their customers and basically be proficient in their territory. With these new mentors, that period was reduced to just three months. Sales people were contributing to the sales and profitability of the company on an average of seven to nine months earlier. This was considered quite significant.
There is a clear correlation between the effectiveness of sales managers and the effectiveness of their sales people.
Third, the organization now understood more clearly why some sales offices were more effective than others. Those sales people who were seen as not as effective by their customers also had sales managers who were not as effective as other managers within the organization. Of course, there were exceptions, but overall there was a clear correlation between the expectations and effectiveness of the sales manager and the effectiveness of their sales people. Those with higher performance standards and who were seen as positive role models had sales people who performed at higher levels.
Fourth, group profiles, which aggregated the individual data, helped identify the strengths and developmental needs for each sales office, each region, and the organization as a whole. The result of these Group Profiles helped trainers (and others) understand where they needed to focus their developmental efforts. The sales trainers now had very specific information about what topics to keep or modify in their sales training programs. They redesigned their training programs based on the feedback and based on the needs of the different client groups and the products they purchased. This needs driven training approach helped them focus the content of their programs towards specific product lines and customer groups.
For example, the trainers redesigned their training programs into "stand alone" modules. All sales people completed a set of core modules of instruction, based on the Group Profile feedback. In addition, some sales people completed other modules based on their unique developmental needs. In this way, those who needed additional training on specific areas received it, while those who were effective in those areas were not required to complete these modules. Other more focused training programs were developed. For example, a three day program was developed for those sales managers whose effectiveness was less than optimal. A two day program was developed to help sales people help their customers become more successful using their products. A three day program was designed to help sales people negotiate more effectively with purchasing agents and key decision makers.
Fifth, the organization stopped the practice of requiring at least eight sales calls per day. They switched their focus to sales results and away from activities that took up time, but produced very little. There was no more of the stop by-to-see-how-things-are-going sales calls. Now, each sales call had a specific purpose and objective. All sales calls now had a specific appointment with a specific contact and a specific topic to discuss. At the end of the call the sales person identified not what (s)he did - To demonstrate a product --but what results (s)he accomplished to move the customer towards a buying decision for a specific product. For example, The prospect agreed to evaluate the product within the next two weeks, or of course, Agreed to purchase the product.
There were some other results that were not initially anticipated. In some areas where the customers identified critical developmental needs, some sales people tried to rationalize away the data by saying that perhaps the customers really didn't understand the questions, or that their feedback was based upon a single event (there was a price hike about four months prior to the feedback process), or the overall data was skewed because of one or two problem customers. After a nice chat with the national sales manager, most sales people decided to live with the results and endorse the solutions needed to resolve the areas for development.
Some of the less effective sales people felt that if they had asked more customers for feedback they would have been identified as being much more effective than the feedback showed. They questioned whether a sample from only 32-40 customers would show a trend, especially a trend that identified more weaknesses than they were prepared to accept. Yes, it certainly can.
The most highly effective sales people were (amazingly) disappointed in their results. They felt the feedback did not identify enough areas for them to work on. They wanted to see a few more areas so they could have something to work towards. They needed a goal. Though they were identified as being effective by both internal and external people, they had difficulty accepting all of this positive feedback from their customers.
Because of their high level of self-motivation and sales success, they were selected as mentors for the newly hired sales people. They were also asked to work with the sales trainers and contribute their ideas about what to change in the sales training programs. This added a new dimension to their position, one that proved to be very beneficial to all.
360-degree feedback that is based on performance, that measures what a person does on the job, can provide you with insights that can increase your competitive edge and improve customer satisfaction. It is often more effective than many other types of customer generated feedback.
