Gather around everyone, Mr. PoP will regale you with a tale of mediocre salesmanship and an entire month of income that was saved only by quick thinking, accurate tracking, and an understanding how what he was being metric-ed on.
Mrs PoP – for you non-sales people, a metric is usually a specific sales target that you have to hit. Mr PoP’s always had several different categories of sales each with different metrics for all of his sales positions.
It Was A Dark And Stormy Night…
Back in 2010 when Mr. PoP was selling handsets at the local retail shop for “Big Red Cellphones.”
As we’ve mentioned, this job was pretty crappy, but was helping us set extra cash aside each month and allowing us to make our first few investments in real estate. One of the
terrible, barely legal problems features of this job was that unless you hit 100% of sales goals (x number of handsets, y number of chargers, z number of cases and protection plans, etc.) you would lose up to two-thirds of your income for that month! Fun times.
After 3 or 4 months on the job, my salesmanship wasn’t up to par and on the 31st day of October 2010 I was about $143 short on accessory sales, which would result in my pay being cut by about $850. I closed the store that night, and had a long drive home to think about how I was going to tell Mrs. PoP that my check was going to be particularly thin that month. About half way home I had a stroke of genius – why not just buy $143 of accessories for myself?
Now, this was the sort of high-stakes gamble that might net me $700 or cost me my job; I was technically letting myself into a store after hours (very bad), as well as screwing with the compensation plan (very, very bad). But, as one of my older brothers told me long ago, “It’s better to beg forgiveness than ask for permission.” With that in mind, I let myself in to one of our other locations that night, bought eight car chargers, and e-mailed my supervisor that I had made a late night transaction.
The next day it was like the sky was falling on me. I got an e-mail from my supervisor (and his supervisor and company owner were cc’d!) chewing me out for entering a store after hours, how I would be fired if it ever happened again, was against all policy and safety codes, etc. However, it said absolutely nothing about the car chargers, and my monthly compensation statement said I had hit all of my metrics! Two months later I had found a new job, and that Christmas everybody in my family got car chargers for Christmas… (Mrs PoP – they got other gifts, too… but yeah. A lot of cell phone chargers as stocking stuffers!)
So What Is The Moral Of This Story?
Understand what you are being judged on at work. Many people don’t! Even in the B2B sales job I work now people still don’t understand how far they are from their bonuses, or even how they are paid. In the personal finance realm its even more important to understand what your goals are, and how you can get there. If you’re not tracking your finances with both an income statement, and balance sheet, please start now!
While I was able to make a last minute correction to improve my outcome for the month, making big decisions like how much money to save for retirement, or if you should make a big purchase like a house may not be as easily reversible. But if you know what your goals are, and have the data to know exactly where you stand in relation to them, you will be much more prepared to get the big decisions right.
Do you have a good understanding of what your goals are and the steps you’re taking to get there?