Helping sales managers improve performance - diagnostic equipment industry

How do you measure a sales manager's performance in areas like clarifying goals, giving feedback and team building? For most organizations, the measurement is subjective.

At the diagnostic division of Abbott Laboratories, Abbott Park, Ill., proficiency in these skills and some 20 others is rated against a national norm. Its 78 sales managers know precisely how they rate on each skill - and the dimensions of each skill - as well as how to leverage their strength and how to overcome soft spots.

The division's senior executives also know how its sales managers as a group stand up against national norms. This is helping them develop strategic initiatives and broad-based development programs. Measurements of this type are now seen as the hub of Abbott's development strategy.

The knowledge the division gained and the resulting actions taken helped it increase both sales and market share in 1994. Sales increased by over twice the diagnostics industry average. As a highly successful sales organization, Abbott undertook the self-diagnosis not for the purpose of correcting problems, but to become even better.

The only relative weakness overall, Abbott learned, was in not encouraging upward communication from its reps. This happens at many organizations where the importance of what subordinates have to contribute is not realized or fully understood by senior management.

Abbott sales managers were rated by each of 500 participating sales reps. To foster openness and objectivity, the reps were granted anonymity. The sales managers' skills were also rated by their bosses everyone from the vice president of sales to regional and district sales managers.

Sales managers received a report that compared all the ratings with their own assessments of each skill. The report included comments from their reps and their superiors, without names, of course.

As can usually happen, there occasionally were large variances between the scores the various raters gave each manager. Different managers learned different lessons from this variance.

Some managers realized that they were giving too little attention to managing veteran sales people who, despite their seniority, still wanted caring and attention. Others recognized they were trying to manage on a "one size fits all" basis instead of meeting individuals' needs. Still others realized they were playing favorites. Sales managers also learned whether their bosses saw them as people who bring in good numbers or value them on more than tangible results.

The reports that managers received presented the findings without interpreting them. The managers were told that they themselves are the best judges of the significance of the information. This helps diffuse possible defensiveness and encourages the managers to improve their performance.

Mike Muldoon, Abbott Diagnostics' director of learning and development, also points out that when processes like this are used, it's important for the people being rated to understand the purpose is development rather than a performance review.

Abbott's managers were encouraged to share their ratings with their reps. Many were uneasy until it was explained that their reports reflected what their reps already felt and the reps could help them perform better.

"Individual sales managers often are startled by their ratings. Senior management usually knows what the group ratings will show, though the numbers are sometimes shocking," says Jack Snader, CEO of Systema, the Northbrook, Ill.-based firm that conducted the analysis for Abbott. Systema, an assessment-based development company that consults on sales force management, maintains a database of the skill levels of over 50,000 sales managers and other databases for other sales personnel.

The high variances in the skill levels of Abbott's sales managers were due largely to the company having grown rapidly and promoted quickly.

Each manager received a report with personal ratings and tools for improving performance at Abbott's national sales meeting. The combined reports also gave management a measurement of human capital in its sales organization.

Each phase of managing was broken down into different dimensions - up to nine dimensions per phase. Each of the dimensions was rated. Managers were advised to look for strengths and limiting factors on any dimension that varied significantly from the national norm. A strength could indicate a tendency to favor use of a particular dimension, possibly ignoring others of equal importance.

Scores that may be close to the norm but have widely varying ratings from different people are also significant. They could signal the need to vary the approach for different people, taking into account differences in what each person needs.

Dimensions that the managers' self-assessments ranked as strengths, but the reps ranked as weaknesses, are important because they're blind spots. Generally, the higher the level of a skill, the better. On the other hand, lower is better in an area like Goal Pressure, while Tension should be moderate.

Relationships between scores are important, too. For example, high scores on Controlling Details and Time Emphasis combined with low scores on Upward Communication and Facilitating Work could mean the manager does too much of the work personally.

Similarly, high scores on Clear Goals and Planning with low scores on Facilitation might mean the manager's reps know what's expected but may not have the capabilities and resources to accomplish it. Co-worker Competence is another indicator of the capability of the group.

Individual comments from the reps were broken down into four sections: What does this person do that should continue? What does this person do that should stop? What does this person not do that he/she should be doing? What other observations do you have to share?

RELATED ARTICLE: How effective is your sales management?

Below are 15 sample questions from the many that Systema asked Abbott Diagnostic Division's reps about their sales managers.

* Discuss goals and quotas with their group to be sure they are clear?

* Encourage sales people to express their opinions and participate in decisions?

* Be systematic about planning and organizing the sales effort?

* Answer most questions about sales rep compensation policies, product knowledge or selling skills?

* Coach sales people to help them improve their job performance?

* Let sales people know where they stand and how they are doing their jobs?

* Effectively stress the need to get things done when they are due?

* Keep track of the performance of each sales rep in terms of sales and skills?

* Develop confidence in the ability of the rep to plan his or her own work?

* Give praise and credit for good sales efforts?

* Make it easy for people to say what is on their minds?

* Develop cooperation and a sense of loyalty among members of the sales group?

* Coach and counsel their reps to improve themselves so they can either advance or increase their worth and importance?

* Be open and aboveboard in dealing with each sales rep?

* Build group motivation and morale?

Tom Heller is vice president of U. S. operations for the diagnostic division of Abbott Laboratories, Abbott Park, Ill.

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