What Really Drives Sales Performance?
Sales is essential to the success of many organizations. And it can be a serious challenge to understand what drives sales performance and what doesn’t.
Fortunately, there is a lot we can learn by using scientific methods.
Organizations can conduct their own research to find what specifically works best for them.
It’s also illuminating to look at overall trends in “big data.” One of the most interesting large-scale analyses includes more than 45,000 salespeople. Let’s talk about what they found.
What is sales performance?
There are 2 basic ways we can measure it.
- Subjective indicators (such as supervisor evaluations or performance reviews) show what people think a successful salesperson looks like.
- Objective indicators (such as quota attainment, sales volume, or contract values) show what a salesperson actually achieves.
What’s really interesting is that research can measure both, and then compare them.
Are there factors that make a salesperson look more successful, without actually selling more?
Background and experience
Factors such as age, education, and years of experience are important in driving sales performance.
But they’re nowhere near as important as people think.
These factors predict about 10% of the variation in subjective indicators (what people think) but less than 3% of the variation in objective indicators (actual sales results).
If you think that IQ is important, this might surprise you.
Several different types of IQ tests were given to different salespeople. Looking separately at verbal ability or math ability didn’t show any relationships whatsoever.
Overall “general intelligence” scores did predict about 5% of the variation in subjective indicators of sales success (what people think) but pretty much 0% of the variation in objective indicators (actual sales results).
Does having a strong interest in sales drive better sales performance?
It does, and people seem to know it.
Sales interest predicted about 10% of the variation on all sales outcomes (subjective and objective measures).
If you do have to rely on one simple indicator, sales interest seems like a good bet.
Does personality drive sales performance?
A great deal of previous research has shown that individual personality traits (usually general traits from the “Big 5”) have a small but significant influence on sales outcomes.
Each relevant trait typically explains between 1% and 5% by itself, and potentially a lot more if you combine the traits in certain ways.
But what’s particularly interesting about this analysis is the comparison between subjective and objective indicators.
While personality traits were correlated with subjective indicators, each was even more strongly correlated with objective indicators of sales performance.
To recap the sales performance drivers
- Background and experience are important, but not as important as people think
- Intelligence probably doesn’t matter (or at least IQ scores don’t)
- Sales interest is one of the strongest simple predictors of sales success
- Personality traits are even more important than people think