BUSINESS EDU Establishing a Clear Target – by Wayne B. Brown, author “From Rags to Enrichment” & CEO, Aggressor Adventures
I don’t have an MBA, so it might not surprise you that I don’t run my busi- nesses the way a business school grad- uate might. Sales forecasting is a prime example. A lot of companies spend a great deal of time, energy, and money trying to determine the total size of the
like mine. I have always despised bonus plans based on sales targets. To continue with the carrot-and-stick analogy, I’ve seen bonus plans backfire, where an employee that wasn’t a hard worker benefitted from a bonus scheme because of the work of others. They got a free carrot. I’ve also seen the op- posite, where a hard worker busts their tail and then barely misses a target that was required to meet their bonus goal. They got the stick when they deserved a carrot. In either case, it’s bad for business because it can bring morale down. I pre- fer to use customer satisfaction to incentivize exceptional service. This establishes a clear target and a winning bonus strategy. For instance, a business can develop a way to receive direct customer feedback on a staff member using a numer-
market and estimate what percentage of the market they can capture. They think it’s important to put a lot of effort into analyzing the various factors that might impact their business. When I’ve been interviewed by people from business pub- lications, they are often shocked to learn I never forecast sales.
When they ask why, I explain that I have two reasons. First, there are so many variables at play-many factors are outside of my, or anybody’s, control. I pay close attention to what’s happening in the world around me, but I don’t obsess about
ical ranking, then assign a dollar value to that ranking. In this way, you can track and reward excellent customer service; you’ll also get an idea of which staff members’ per- formance needs improvement. By
using a merit-based bonus system rather than a made-up sales target, the business creates direct rewards and removes ex- ternal factors that might otherwise impact a bonus scheme. The bottom line is that so-called “standard business prac- tices” aren’t the only way to go. While there are some stan- dard practices that are good to follow, there is no blueprint
things I can’t change. Next, I work hard every day to maxi- mize sales. This is what’s within my control. I’d rather spend my time making sales than forecasting them. I don’t need a forecast or target to motivate me; my work ethic is strong without needing to create an imaginary carrot dangling in front of my face. Instead of aiming to hit made-up targets, I focus my energy on marketing, advertising, and providing the highest level of customer service possible. I am excited about growing my business, and I lead my team in a way that helps each person develop a work ethic
for how every business should operate, so don’t be afraid to step outside what most people would call the norm. Experiment to find what works best for you and your business.
email Wayne
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