Looking back on more than four decades in the LBM industry, you can’t help but smile when you think about how simple it all appeared at first. Today, as the general manager of the company you started with back in high school, you know all too well that nothing happens until a sale is made. While it’s true that sales keep your people busy and keep the inventory turning, those sales must be profitable to ensure your company’s health and future growth.
Your salespeople understand the importance of earning fair margins, especially since their commission structure is based in part on how profitably they sell. A big believer in friendly competition, you keep a running chart showing each salesperson’s sales and margin percentage posted on the wall outside your office. You’ve found that underperformers tend to up their game when their numbers are known throughout the company. And, from your experience, top performers have always been happy to help and coach others to boost their sales and margins. Until now. Here’s the story:
Don has been a member of your sales team for more than 15 years. The only thing noteworthy about his performance has been how consistently average it’s been. Without fail, month after month, and year after year, Don’s sales and margin numbers place him dead center in the middle of the pack. No amount of coaching, training or incentives had an effect on his sales. He seemed fine with that so, in time, you became fine with it as well. After all, you had your hands full working with the low performers.
Lately, you’ve noticed that Don’s sales numbers have been edging up, and his margin numbers have gone up as well. When you congratulated Don he looked away and didn’t have much to say. That reaction was consistent with Don’s low-key personality. However, Fred, another sales rep who witnessed the conversation, had a much different take.
“Boss, do you know why Don wouldn’t meet your eye when you congratulated him on his numbers? It’s because he’s been stealing sales from me and some of the others. He takes the quote and order and types it in under his name so the computer gives him credit for the sale. It took us a while to figure this out, but we’re 99% sure that Don’s been stealing our sales. I was just on my way to talk with you about it. It needs to stop, and we all expect to be paid the commissions we’ve earned on sales he stole.”
In all the time you’ve known and worked with Don, this is the last thing you’d expect. But it would explain the recent spike in his numbers. Then again, you’ve had to mediate disagreements between salespeople before. Fred is a newer member of your company, and his dip in sales does coincide with Don’s increase. Maybe this is just a case of jealousy, and someone desperate for a scapegoat. What would you do?
|1. CONFRONT DON. Sit down with Don and tell him exactly what you were told and ask him if it’s true. That may be all it takes to get to the bottom of this and clear it up.
2. INVESTIGATE. Have a meeting with your human resources director and sales manager to determine the best way to navigate this to get to the truth.
3. FIX THE SYSTEM. If it would be possible for someone to change orders to steal someone’s sale, you need to put systems in place to make that difficult or impossible in the future.
4. LET IT GO. Knee-jerk reactions are never a good idea. Wait and watch the situation to determine what’s really happening, then discipline or fire the wrong-doer.
What would you do?
See how your judgment compares with others in the industry at LBMJournal.com.