Strictly Sales: Managers should apply positive and negative feedback

PICs or NICs given within a reasonable time after events help employees either repeat or avoid a behavior. Praising producers after they close a deal increases the likelihood producers will repeat the accomplishments; using NICs soon after an unsatisfactory behavior leads employees to do things differently next time.

A manager in one of our offices regularly acknowledged positive behavior in voicemails, provided expensive company clothing awards and wrote memos (copied to the company president) about achievements. He spent time in the field with each producer, no matter how experienced, providing PICs and NICs based on his first-hand observations. This manager took a $2.5 million revenue agency to $6 million in five years. He also prepared three of his eight producers for management positions. Because he produced superior results, significant income and promotions for his staff, he had a steady stream of highly motivated producers desiring to be hired or assigned to his office.

Don't use PICs and NICs at the wrong time. A PIC or NIC given two months after an event can be confusing and send the wrong message. This sometimes occurs when a producer is a friend of the manager, the manager is uncomfortable, or an unsatisfactory activity is not tracked and accessible to the manager. It also could indicate that a manager is too busy to review results or that other factors are deemed more important.

Managers should acknowledge accomplishments as often as, or more often than, mistakes. Some managers think incentive or commission plans are the only motivation required. This is wrong. Judicious and timely use of PICs will allow NICs to be more effective: "He only says something when I make a mistake. I might take him seriously if he saw all the good work I do."

PICs and NICs should be commensurate with the significance of a behavior. The first phone call from a customer complimenting a producer or CSR for excellent service doesn't merit an immediate promotion; however, an immediate acknowledgement with a follow-up memo is appropriate. Exceeding sales, retention and customer-service goals over an extended period of time does merit a promotion or special pay consideration.

Repeated use of PICs and NICs should follow repeated appropriate or inappropriate behavior. Usually, inappropriate behavior is an indication of other problems–e.g., lack of training, desire or ability; or inappropriate workloads. If the problem is desire or ability, NICs should be more serious and documented in writing to ensure a clear understanding that the problem could lead to termination.

Using PICs and NICs wisely helps managers establish shared and realistic goals with employees. Correct behavior must be clearly described and reviewed frequently. This means using the dreaded activity report, which is easier to implement when it is used to acknowledge positive behavior, when it leads to successes, and when it can be automated. This may seem "controlling," but new producers will welcome the assistance. Less frequent coaching can be a reward for successful producers, but positive recognition is still appreciated.

Experienced producers who are not performing will resent close monitoring. Future PICs for such producers could include less-frequent monitoring upon reaching specific goals. However, close monitoring allows managers to determine why a producer is unsuccessful and to offer assistance.

Managers sometimes make mistakes in trying to provide positive (or negative) reinforcement to producers. As one manager was assigning annual goals, a producer convinced him that his territory was different; the producer couldn't achieve the new-business goal that other producers were achieving. The manager knew opportunities were equal, but reduced this producer's goal because he wanted the producer to achieve some success. The manager was frustrated three months later when that producer returned with the same excuse concerning the employee-benefits goal.

Used timely and consistently, PICs and NICs can produce outstanding results. They will motivate the top 20% to excel and the middle 70% to develop, and they will help eliminate the bottom 10%. Correct activities must be clearly defined, communicated and monitored. Termination of the bottom 10% should be considered a last resort and a problem with hiring, training or motivating on the manager's part. PICs and NICs are the most powerful tools a manager has, but in many cases are the least used.

Jerome P. McAndrews is president of McAndrews and Associates LLC. Jerry has spent over 30 years within the insurance industry leading a direct sales force in an insurance agency, and was chief underwriting and claims officer with the second-largest insurance group in the U.S. He continues to consult with insurance agencies and insurers. He is a faculty member of The National Alliance for Insurance Education and Research. He can be reached at mcandrew@everestkc.net. To learn more about Dynamics of Selling and The Producer School, contact the National Alliance at (800) 633-2165 or visiting www.TheNationalAlliance.com.