Do Sales Goals Make Sense?

This advice costs a lot of money, but I can safely offer it here without risking a reduction in my income, because almost no one will implement it anyway, even though it is easier than making breakfast.

Someone says to me:

"I have a good product, a well-organized sales team, revenue is growing, but it's not what I expected."

"Are you setting them sales goals?" I ask.

"Yes."

"Are they meeting their sales targets?" I ask.

"Yes."

"So where's the problem?"

"I feel they have more potential..."

"Of course they do," I nod. "So do one thing: print out the KPIs and throw them all in the trash. Publicly. In front of them. Tell them that from now on, there are no performance guidelines. If you have any bonus rules and they're based on sales value or quantity, let them stay for now. You'll deal with that later. For now, change this one important thing and see what results this change brings."

And what do I usually encounter then? Resistance and disbelief. However, I have the impression that the real problem isn't a lack of faith in people. The real problem is the acute sense of loss of control and - above all - the difficulty in accepting that one has made a mistake and admitting it publicly.

There Are No Ideals


This isn't just true in organizations that are self-sufficient and operate within a competitive market. It's also true in public administration. In some institutions, some staff also have numerically defined goals. Through their work or service, they produce what we might call statistical data. It's the same there as in businesses: make it look good (because it doesn't matter how it is, what matters is how it looks), but don't give it your all, because if you maximize your capabilities and reach your limits tomorrow, and someone in the decision-making room has a strange dream at night, and suddenly your standards rise by 10 or 20 percent in the morning, then from the high base you create for yourself, reaching your own limit, you won't be able to add another 10 or 20 percent without falling flat on your face. That's why no intelligent person gives their all if they have set metrics to meet, because that's potentially dangerous.

Don't Ignore People's Needs - It Burns Your Money

And at this point, a common statement is:

"If they sold more, they'd earn more." [I generally agree with this.]

"Are your employees starving?" I ask.

"No! I pay them well!" I hear in response.

"Have you heard of Maslow's pyramid, the hierarchy of needs, or the ERG theory?"

"Yeah..." my interlocutor replies unconvincingly, as if searching his memory for something.

"Do you understand roughly what this is about?"

"Well, yeah..." [Unconfirmed, but let's assume it's true. After all, the CEO/owner is a fanatic of management and psychology literature and has plenty of time to read after spending fourteen hours at work.]

"Then as long as your employees aren't starving, safety will be more important to them than extra money." They will behave in ways that create a sense of security at work, and increasing sales today may cost them a sense of security next year. Only when their physiological needs are unmet and they are hungry, like our caveman ancestors, will they take the risk of leaving the cave to search for food, even if this means leaving the safety of their surroundings and exposing themselves to the risk of losing something. For example, their lives in a confrontation with a wild animal.

I'm talking to you, out there, in front of your screens! Throw your KPIs in the trash! And you can thank me by donating a few pennies to help children in orphanages.