The most important part of sales performance management at the beginning of the new year is setting sales quotas and rewards. Clear goals and incentive compensation for reaching those numbers can motivate representatives to reach unprecedented levels of success.

Projected growth is an important factor for calculating new quotas, but it isn't the only figure worth keeping in mind. The Profit Guide notes that an inaccurate prediction can hurt a vendor's revenue stream, but there's another possible outcome – diminished employee morale. Sales representatives are often frustrated when they can't reach their quotas, so it's essential that managers set attainable goals.

Set lower bars
Inc. Magazine recommends setting benchmarks that are slightly below the previous year's totals. The news source writes that a manageable workload prevents agents from overwhelming themselves and burning out. Additionally, employees are satisfied when sales incentives are realistic and attainable.

Corporate culture is an important consideration to keep in mind when you're making quotas. For instance, if new business is more important to your goals than recurring clients, it might be beneficial to set high expectations. Clarify your compensation policies so that your representatives know that they can earn rewards even if they don't hit astronomical numbers.

Tailor your quotas
Agents have various sales techniques and work with different customers and, as a result it's almost impossible to set realistic company-wide quotas. Some representatives might have difficult clients and new employees aren't as well-versed in pushing merchandise and generating leads as their experienced associates.

The Houston Chronicle notes that managers should set higher quotas for seasoned veterans and relatively low numbers for agents in the sales on-boarding process. Experienced personnel can help obtain steady growth and new business, while recent hires find their footing. Quotas can be adjusted as the performance of new personnel improves.

Consider the incentives and periods
Effective incentive compensation management (ICM) keeps representatives satisfied and on pace to meet their quotas. Managers can set monthly or quarterly goals so that employees can earn rewards and create new motivation for the rest of the year.

Additionally, small goals help agents remain focused on their quotas rather than waiting for the end of the year. Supervisors can use ICM software to update their employees on their progress. Applications can rank representatives based on their current performances and provide clarity for key points like customer retention.