The HERO formula: Increase sales performance by boosting psychological capital

Sales is a complex, dynamic, and sometimes a frustrating environment. Employees regularly must think on their feet to deal with various obstacles and rejections. Constant setbacks and stress can lead to work burnout, including loss of motivation, exhaustion, and lowered creativity and focus. Sales performance is therefore not only determined by how well you can sell your product, but also how resourceful you are at dealing with challenges and adversity. 

Today’s post will look at four important psychological drivers that make up an employee’s psychological capital–that is, the resources he can rely on when facing challenges. 

Employees with these resources tend to perform better, because they feel better equipped to deal with challenges, tend to persevere more in light of adversity, and tend to recover faster after failure.

Specifically we will be looking at the four drivers of psychological capital:

  • Hope
  • Efficacy
  • Resilience
  • Optimism

We will look at how these drivers influence sales performance, and more importantly, what we can do to increase them.

As always, this post is based on over 30 research studies on psychological capital, positive psychology, and marketing drawn from the fields of Industrial and Organizational psychology.


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Introducing Psychological Capital

Psychological capital is typically defined as a positive psychological state of development. It is characterized by:

  1. Persevering toward goals and, when necessary, redirecting paths to goals in order to succeed (Hope)
  2. Having confidence take on an put in the necessary effort to succeed at challenges (Efficacy)
  3. Sustaining and bouncing back (and even beyond) problems and adversity to attain success (Resilience)
  4. Making a positive attribution about succeeding in the future (Optimism)
psychological capital

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So how does psychological capital relate to sales performance?

Research finds that sales people who score higher on psychological capital tend to be more energized than their colleagues. This manifests in putting forth more effort which results in higher levels of performance across extended periods of time, as they have more confidence that they can achieve high performance (self-efficacy). 

Moreover, sales people who score higher on psychological capital also tend to have the willpower to generate multiple solutions to problems that may come their way (hope), more positive expectations for future results (optimism), and more perseverance in the face of adversity (resilience).

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Increasing Psychological Capital

So, now that we understand how psychological capital helps sales performance, it is time to look at some tactics that will help us increase it. These tactics draw heavily on promoting team discourse, but can also be adjusted to fit individual needs.


Boost hope by setting goals and creating pathways

The first psychological drive is hope. Within the psychological capital literature, hope is defined as a person’s ability to motivate themselves to set and achieve goals, and to proactively be able to determine alternative routes for achieving those goals. Hope can therefore be subdivided into elements: willpower (the ability to direct energy to plan and reach goals) and waypower (the ability to determine alternative paths).

Develop contingency plans. Looking at sales performance (or the workplace in general), sales people who score higher on hope appear better at generating multiple paths for job success. This makes them less dependent on specific job conditions. In other words, they utilize contingency planning by forecasting potential obstacles that may impede them from achieving their goals, and identifying alternative pathways to circumvent said obstacles, and thereby enhance their sales performance.

willpower and waypower

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As noted earlier, hope is mostly impacted and influenced by:

  • the goals that have been set, 
  • the pathways that have been set out to achieve these goals, 
  • and the employee’s sense of agency towards the goal.

So if we want to increase hope, the first step will be to get employees acquainted with how to set good work-related goals. The goal will be to let employees set up stepwise techniques to accomplish their goals, in which they will explain each sub-goal, or step, to the group, and how they aim to accomplish them. Emphasize that goals should be personally valuable, reasonably challenging, and have a clear beginning and end point. This will tap into the employees’ sense of intrinsic motivation, thereby creating sustained motivation, and increasing the employee’s sense of agency.

intrinsic motivation

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Boost efficacy with a culture of support

Next, efficacy is rooted in Bandura’s social cognitive theory, and is defined in the workplace as “an employee’s conviction or confidence about his or her abilities to mobilize the motivation, cognitive resources, or courses of action needed to successfully execute a specific task within a given context.” 

Efficacious employees are generally typified as being more confident in their abilities, which makes them more persistent and likely to engage in certain task-specific activities. This confidence generates motivation and cognitive resources to meet situational demands.

So, an efficacious employee’s performance is high because they are generally more likely to accept challenges and exert the necessary effort to achieve the related goals. This is especially important given that the buyer-seller relationship takes place in a complex and dynamic environment, so having high levels of efficacy is essential to achieve high levels of sales performance.

Efficacy –  Boost efficacy by encouraging a culture of support for each employee’s work goals. Begin by having each employee present their plans to each other. This will allow each employee to see how their peers work toward their goals. Moreover, this will give your employees the opportunity to share success stories, which will increase positive expectations.

It is also important to be able to deal with obstacles that may occur during a path. Peers can help create additional contingency plans and fresh ideas if unexpected challenges arise. Hence, after completing the exercise individually, each employee should also receive feedback from the team on tips on other approaches that may help overcome their identified obstacle, and what other potential obstacles the team has identified that the employee may not have seen. 

This exercise will help employees create a reference for possible tactics to help identify and deal with obstacles, and also ensure that the knowledge within the team is shared. Aside from providing your employees with the necessary skills to achieve their goal, it is also important to note that this will foster a culture of support in which employees feel that they can rely on each other for advice.


Boost resilience by creating strength in numbers

Resilience is defined by a person’s ability to quickly and effectively bounce back from adverse events. When looking at the workplace, we can see resilience as a reactive resource that allows employees to recover from a multitude of events, such as adversity, uncertainty, conflict, failure, but also positive change such as increased responsibility. 

This means that those who are highly resilient are able to recover to (or even excel beyond) the status quo before an event. Moreover, it seems that people become more resilient to adverse events of the same type, each time that they are able to successfully navigate a setback. 

Needless to say, resilience plays an important role in sales performance, due to the high level of adversity and failure that sales people may experience during their job.


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Develop resiliency by creating awareness of all the resources that are available to the sales team. These resources consist of personal assets such as talents and skills, but also communal assets such as social networks, knowledge and skills within the team. 

The goal will be to ensure that the team members are aware of all the resources that are available, and thereby not feel alone in overcoming adversity. In other words, the goal will be to change the initial feelings of despair to resilient thoughts based on the assessment of their resources, and options that will help them overcome their adversity. 

To do this, we will step up a similar approach as the previous exercises:

  • First, ask each team member to list all the available resources that they could use to achieve a certain goal. 
  • Next, as a group, go over the individual lists and tally the occurrence of each resource and see which are most popular, and which are least popular, and discuss the reasons behind this. 
  • Then create one team list that combines all the resources and try to identify additional resources. 
  • Using this list we again try to identify obstacles that may impede our goals, but in contrast to the hope exercise, we focus on making plans to avoid the obstacles. The aim is to prevent challenges from becoming serious concerns in the first place.

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Boost optimism with positive experiences

The last driver of psychological capital is optimism, which represents, as you may have expected, a positive outlook to outcomes, including positive emotions and motivation. 

Please note that the difference between optimists and pessimists is not trivial, as optimists not only appear to differ in the way that they approach problems and challenges, but also in the way (and the effectivity) that they cope with adversity. The driving factor underlying these differences is a positive expectancy of desirable outcomes. This allows optimists to keep putting forth effort regardless of increasing adversity. Needless to say, this positive outlook, and with it, propensity to keep putting forth effort allows optimistic sales people to perform better than pessimistic sales people.

Building optimism comes from the generation of positive experiences. Hence, it is important to plan for future success, and to celebrate victories when goals are met. Planning for success comes from giving the tools to identify and overcome obstacles, therefore it is important to create a culture in which employees can voice their concerns and struggles, so that other people can help. 

One suggestion is to create a help board on which obstacles are posted. To Incentivize helping behavior, be sure to reward employees who take time to engage with concerns, even if this just means thanking them. Moreover, celebrate victories with team based events, such as ordering lunch, afterwork activities, or publicly acknowledging successes at team meetings.

building optimism

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Recap of increasing sales performance by increasing psychological capital – the HERO formula

Sales is a dynamic and complex environment in which employees regularly have to deal with obstacles and adversity. Luckily, by focussing on the four drivers of psychological capital, we can find ways to better prepare employees for their job. 

The 4 pillars to increasing psychological capital are improving:

  • Hope
  • Efficacy
  • Resilience
  • Optimism

And specific strategies to improve the above would be:

  • Help employees train their goal setting skills, and help them create contingency plans 
  • Create a shared knowledge network that allows employees to learn from each other
  • Create a shared resource network that allow employees to support each other