13
Evaluating Salesperson
Performance
Performance versus Effectiveness
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Behavior – what people do; tasks
on which they expend effort
Performance – behavior evaluated
in terms of contribution to
organizational goals
Effectiveness –summary index of
organizational outcomes for which
individual is at least partly
responsible
13-2
Performance Evaluation Measures
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Objective measures – reflect
statistics sales manager can
gather from the firm’s internal
data
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Output
Input
Ratios of output or input
Subjective measures – rely on
personal evaluations by sales
manager and others
13-3
13.1 Attributions and Salesperson
Performance Evaluation
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Ability = Task difficulty/Effort
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Performance = (Ability X Effort ± Task difficulty)
Source: Thomas E. DeCarlo, Sanjeev Agarwal, and Shyman B. Vyas. “Performance Expectations of Salespeople: The Role of Past
Performance and Casual Attributions in Independent and Interdependent Cultures.” Journal of Personal Selling & Sales
Management 27 (Spring 2007) pp. 133–47l; Andrea L. Dixon, Lukas P. Forbes, and Susan M. B. Schertzer. “Early Success: How
Attributions for Sales Success Shape Inexperienced Salesperson’s Behavioral Intentions.” Journal of Personal Selling & Sales
Management 25 (Winter 2005) pp. 67–77; Andrea L. Dixon, and Susan M. B. Schertzer. “Bouncing Back: How Salesperson
Optimism and Self-Efficacy Influence Attributions and Behaviors Following Failure.” Journal of Personal Selling & Sales
Management 25 (Fall 2005) pp. 361–69.
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13.1
Common output and input measures used to evaluate salespeople
13-5
Ratio Measures
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Expense ratios
Account development and
servicing ratios
Call activity and productivity
ratios
13-6
Common ratios used to evaluate salespeople
13.2a
13-7
Common ratios used to evaluate salespeople
13.2b
13-8
Common ratios used to evaluate salespeople
13.2c
13-9
Summary Equations
Sales = Days worked X
Calls
X Orders X
Sales
Days worked
Calls
Orders
Call rate
X Batting X
avg.
Avg.
order
size
or
Sales = Days worked X
13-10
Typical Attributes on Appraisal Forms
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Sales results
Job knowledge
Management of territory
Customer and company
relations
Personal characteristics
13-11
Problems with Subjective
Performance Measurement
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Lack of an outcome focus
Ill-defined personality traits
Halo effect
Leniency or harshness
Central tendency
Interpersonal bias
Organizational uses influence
13-12
13.4
Sample of a poorly constructed subjective performance evaluation form
13-13
Avoiding Errors in Performance
Evaluation
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Read definition of each attribute
thoroughly before rating
Guard against tendency to overrate
Be as objective as possible
Do not permit your evaluation of one
factor to influence your evaluation of
another
Base your rating on observed
performance, not potential abilities
Rate an employee on general success or
failure over the whole period
Have sound reasons for your ratings
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13.2 Outcome Bias in Evaluations
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Sometimes outcomes and
processes leading to outcomes
match, sometimes they do not
Evaluators tend to overlook process
and rate performers based on
outcomes
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Relationship selling requires
attention to behaviors that may or
may not influence the bottom line
for some time
Source: For recent treatments on the outcome bias see: Nidhi Agrawal and Durairaj Maheswaran, “Motivated Reasoning Outcome Bias Effects,”
Journal of Consumer Research 31(4), pp. 798–805; Philip J. Mazzocco, Mark D. Alicke, and Teresa L. Davis, “On the Robustness of Outcome
Bias: No Constraint by Prior Culpability,” Basic and Applied Social Psychology 26(2/3), p. 131.
13-15
BARS Systems
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Behaviorally anchored rating scale
(BARS) system concentrates on
criteria the individual can control
Requires sales managers to
consider in detail a wide range of
components of job performance
Requires clearly defined anchors for
each performance criteria
13-16
13.5
A BARS scale with behavioral anchors for the attribute “promptness in
meeting deadlines”
13-17
360-Degree
Performance Feedback
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Integrates feedback from external
customers, internal customers,
other members of the selling team,
the sales manager, and the
salesperson
Provides the impetus for a more
productive dialogue between the
sales manager and salesperson at
performance review time
13-18
Performance Management System
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Requires a commitment to
integrating all the elements of
feedback on the process of serving
customers
Results in performance information
that is timely, accurate, and
relevant to the firm’s customer
management initiative
Salespeople take the lead in goal
setting, performance measurement,
and adjustment of their own
performance
13-19
13.3 Effective Appraisals
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Preparation
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Appraisal interview
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Reps rate themselves
Focus on their impact, needs, and
goals
Discuss salary separately
Focus on own and rep’s preparation
answers
Post-appraisal
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Share formal review documents
Connect salary to appraisal issues
Sources: "Three Steps to Great Performance Appraisals," Sellingpower Sales Management Newsletter, June 2007 "Are you
missing an opportunity to motivate performance?" Sellingpower Sales Management Newsletter, 2008
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