Evaluating the Performance of Sales People and Sales Managers

In most cases, evaluating the performance of salespeople is pat. They either make their numbers or they don’t. Perhaps an oversimplification, but not a monumental one. Evaluating the performance of the safes manager, though, has traditionally been more art than science.

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“At State Farm,” says Donald W. Frischmann, agency division vice president, “we felt that it was both im¬possible and unrealistic to attempt to evaluate the performance of agency managers (sales managers) until we developed a realistic data-supported basis for evaluation. From a research standpoint, we needed to capture and verify the key dimensions of the sales manager’s job. From a corporate standpoint, we knew we would have to use this information to define the role we expected sales managers to fill, communicate those expectations, and help current sales management see how those key performance dimen¬sions were, in fact, the essence of good sales management.”

The research
State Farm’s corporate research de¬partment did their job and did it well. After several years of intensive re¬search and results validation, they were able to isolate seven key per¬formance dimensions: a) recruiting and selection; b) training new agents; c) agent/manager relations; d) busi¬ness and sales management; e) insur¬ance sales leadership — life; f) insur¬ance sales leadership — casualty; g) insurance sales leadership—health.

Frischmann hastens to add that the dimensions are, at first blush, pretty self-evident. Most insurance people would suggest that these are the kinds of activities managers have always been involved in. Frischmann con¬cedes the point, but argues that the development of a research-based and validated managerial evaluation system — such as this one — has a great deal of power for improving manage¬rial performance within an organization, even if the empirically developed evaluation system does contain some common-knowledge concepts.

He cites four major benefits to the performance dimension effort.

First, the research and development process brought management to¬gether and, in a sense, demanded that they reach consensus on what was expected of an agency manager. Second, agency managers now had a clear picture of what was expected of them. Third, the scales and the behavioral descriptions constitute a common vocabulary for discussing performance. The fourth major benefit was the impact the system had on the agency manager career development path.
Manager identification and selection, manager appointment and placement, and manager training and career development were all impacted by a clear, valid, and management-supported set of performance evaluation scales.

What do you look for in a prospective manager? The dimensions on the evaluation scale. What do you train them to do? Perform the behaviors which constitute the performance dimensions.

As part of the process of selecting new managers, Frischmann was able to develop genuinely useful “career orientation seminars” for potential new managers. The seminars gave management a look at truly qualified candidates and the candidates a “no-bull” look at what management is allabout.

All hearts and flowers?

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Has it been all hearts and flowers at State Farm since their research-based performance evaluation system was completed? Not quite. Frischmann cites three problems they have en¬countered.

1. Reluctance to evaluate manager performance solely on the basis of bottom-line results. Frischmann re¬minds us that Dr. Marvin Dunnette has suggested that people tend to con¬sider three elements as equally impor¬tant to the managerial evaluation process: 1) The Person— What kind of individual is the manager? 2) The Process — How does the manager go about managing? 3) The Product — What is the result of the manager’s managing?

The Product, the bottom line, Fris¬chmann suggests, is most important of the three. Frischmann contends that there are those who are reluctant to accept the fact that different kinds of individuals, using different kinds of approaches and techniques, can all end up with a satisfactory bottom line. Some middle managers are darned uncomfortable with agency managers who don’t “do it the way I did when / was out in the field.”

2. Conversely, they also found that some individuals who have the re¬sponsibility for the supervision of field sales managers are reluctant to com¬mit themselves on several items relat¬ing to the manager’s performance which go beyond the product of the managing, beyond the bottom-line or “paid-for” production report. Perhaps this is because the supervisor doesn’t really know enough about the manager being evaluated to respond to some of the items.

3. “Some managers,” as Douglas McGregor aptly put it, “are afraid of playing God,” of evaluating someone else’s performance. This may be be¬cause they genuinely dislike having to do it in the first place, or because higher management and/or training folks haven’t provided the tools or the know-how to accomplish the task.

But Frischmann quickly points to the system’s strength: “Many of our sales manager supervisors say that the new process has given them, for the first time, a real basis for sitting down with the sales manager to dis¬cuss intelligently all facets of the managerial operation in relation to both the manager’s goals and the ob¬jectives of our company.”

Frischmann sums up by suggesting that it isn’t simply the quality of the tools which dictates the success or failure of a performance-evaluation system. Success also depends on view¬ point— how the system is viewed and used. “To the extent that we can keep everyone’s attention focused on the use of the performance-evaluation process as a developmental tool, rather than as a punitive report card,” he asserts, “we can continue to im¬prove the performance of both the sales manager and the manager’s supervisor.”

Source : Training Magazine. August 1978.