How To Set Sales Goals: The Ultimate Smart Goals Checklist

So, you think you know sales goals? Think again. Chances are, your whole sales team could be approaching sales goals in completely the wrong way, and it could be harming more than just your sales targets. With the wrong sales goals, revenue growth, sales performance, and sales team morale could all be taking a hit. So discover our time-saving tips to revamp your objectives and get your sales team on track for success.

Nobody understands smart sales goals better than Elizabeth Frederick: as senior advisor at Criteria for Success, Collavia CEO, and Let's Talk Sales podcast host, Elizabeth has leveraged her extensive experience to compile fool-proof recipes for success your sales managers and sales teams can use to streamline your sales strategy and reach your business goals.

In this episode, we discussed Elizabeth's tried-and-tested S.T.U.P.I.D. formula - and no, that's not what it sounds like. Elizabeth's method helps companies achieve sustainable business growth by setting realistic sales goals your sales team can actually use.

Without further ado, let's get into it.

Why are smart sales goals important for growth?

Before we get into the nitty gritty of setting sales targets, it's crucial to understand what a sales goal is and why they're so important for success.

We know what you're thinking: 'but I already know what a sales goal is!' It's obvious, right? Well, maybe not.

Many sales professionals, from top executives all the way down to sales reps, actually misunderstand the concept of sales goal without even realizing it. Elizabeth gives a great example: a sales rep might have a monthly sales 'goal' to 'make 1000 calls,' for instance. Great. The problem is that this isn't a goal - it's simply a task. (We'll get into how to formulate a more effective sales goal later, so stick around.)

Well-formulated sales goals (be they annual sales goals or short-term goals for individual sales reps) are essential if you want to increase revenue. They can:

• Provide direction
  
  • Defined sales goals give everyone - whether you're a sales manager or a sales rep - a focus with which to prioritize their tasks.
• Measure sales performance
  
  • By providing benchmarks, goals help to monitor sales metrics and identify strengths and weaknesses within your sales strategy, pinpointing areas for improvement.
• Align sales and marketing
  
  • Different departments can work together more effectively when they know exactly where they're heading and how to get there, minimizing pain points.
• Optimize resources
  
  • With clear plans explicitly laid out, sales teams and managers can allocate resources where they can make the most impact, saving both time and money.
• Help with forecasting
  
  • Using sales objectives, monthly sales goals, or even annual sales goals can help to project and model future revenue growth. Without goals, you're shooting blind.

And if you want pure numbers to back this up, evidence suggests that businesses who set quarterly sales goals bring in 31% more returns. That's a serious competitive advantage which you could be missing out on.

The S.T.U.P.I.D. method your sales team can use to avoid ineffective sales goals

Elizabeth has worked extensively with companies to enhance their sales processes with her SMART goal framework. But she's not only an expert in how to set sales goals; she also understands the hallmarks of bad - or, 'stupid' - sales goals.

She came up with a handy acronym framework which lays out all the features of BAD sales goals you should avoid. So take a look through this checklist and see which one you can tick off for better sales goals.

'S' for 'should'

All too often, sales managers and sales reps set sales goals they think they should be setting without knowing why. They're essentially copying successful habits from other sales reps or leaders in the field.

• Example: 'I think I should network more. That's what it takes to be successful'

The problem here is that the person who set this goal probably doesn't like networking much (otherwise they'd already be doing it). They'll find ways to put it off, or, worse, will go and make a bad impression.

That's not to say you can't set sales goals that force you out of your comfort zone, but you should write sales goals that work together with your skills, interests, and sales objectives if you want to see tangible results.

'T' for 'tasks'

We touched on this point earlier: the common confusion between 'tasks' and 'goals', and gave the example of a sales rep who aims to 'make 1000 calls this month'.

This is basically a quota, not a goal. The key to good goal setting is to focus on the desired outcome of a task. In the case of this example, a more appropriate goal would be: 'I want to connect with four prospects and discuss potentially working with them.'

While this may seem like a subtle distinction, it has enormous implications for sales reps' performance and the overall sales process of your company. By focusing on outcomes, you turn a list of tasks from a checklist into a series of opportunities to advance sales proposals and hopefully increase revenue.

'U' for 'unaligned'

You need to make sure you set realistic sales goals that align across all levels of your organization. This means that everyone - CEOs, the sales manager, and sales reps - needs to understand how your monthly sales goal translates to overall business objectives, and also how those sales goals look under a microscope.

Grand annual strategies may look great on paper, but your sales team needs to understand how it translates to their day-to-day workload: doubling an annual revenue target means very little by itself. How can your sales team actually work toward that?

'P' for 'procrastination'

Here's a challenge: take a look at your task list. Look for all the tasks you consistently put off. Are there any patterns?

Whatever your reason, whether some tasks are just too big or whether you simply hate doing them, these are sales goals examples that aren't working. Achieving sales goals means breaking down tasks into - you guessed it - achievable chunks. Believe us when we say that this small change will eventually increase sales.

'I' for 'inattentive'

You need to stick to challenging goals, sure, but you also need to have processes in place to deal with changing situations and feedback. Sales leaders should be attentive to a variety of metrics, such as past sales data, customer acquisition cost, number of qualified leads, an inefficient sales cycle, and ongoing sales activities to properly track progress and adjust goals for your sales where necessary.

'D' for 'disconnected'

Again, this is one for your sales team: sales goals need to be aligned with your calendar and task list. A sales goal that only exists in principle doesn't really exist; it needs to be written in ink on your to-do list, blocked out and immune to procrastination.

Be specific, too. Blocking out, for example, 'prospecting' is too broad. Break each sales goal down into hyper-specific tasks, such as 'building my list,' 'building my sequence,' or 'cold calling'. These tiny segments then feed into team goals much more effectively.

Help your sales reps achieve sales goals more effectively

When you're sitting down to write your next big sales goals, spare a thought for the S.T.U.P.I.D. system - it's anything but stupid. It'll be your best friend when it comes to avoiding common sales goal mistakes that cost thousands of companies millions of potential dollars in sales revenue every year.

What it comes down to is this: formulating attainable sales goals that align both with your skills and interests and across multiple levels of your organization. You should make sure your sales team has defined sales goals that focus on the desired outcome of a task rather than the task itself, and that the tasks required to achieve them are clearly written down. And lastly, always be ready to adapt. Situations change, and your sales goals should too.

If you want to enhance your sales process to the max, why not follow Elizabeth on LinkedIn or visit her website? She's the go-to expert helping hundreds of companies boost sales revenue with a sales goal that works for them.

Likewise, Leadium is perfectly placed to bring your sales objective into view. With over ten years of B2B lead generation and sales development experience, we've helped hundreds of companies make their sales process the best it can be.