- January 22, 2014
- Posted by: Dave Kurlan
- Category: Understanding the Sales Force
This is the 8th article in a January series on the Architecture of the Sales Force. Here are some of the others:
- Organic Sales Growth and Its Impact on Sales Architecture
- Why Doesn’t Sales Methodology Get More Attention?
- Getting a Sales Organization to Buy-In to Sales Training
If we refer to baseball, the best sport for sales analogies, there’s a word that ball players and managers use quite often: Execute.
Pitcher: “I felt strong out there, had good velocity, good stuff, but I didn’t execute my pitches.”
Manager: “We had a game plan as to how to approach [the opposing pitcher], but we just didn’t execute very well today.”
You could substitute most any sport and the dialog would be similar. Larry Bossidy and Ram Charan even wrote a best-selling business book titled, Execution. Yet in sales, we rarely hear anything as simple or basic. We’re far more likely to hear about competition, politics, relationships, price, marketing, or the product itself before we hear anyone utter execution as the reason for not winning an account or a deal. Why is that?
There are some very large egos in sales and some of the largest can be found occupying sales leadership roles. For a sales leader to say, “We failed to execute”, is an admission that they weren’t good enough. While the admission of ineffectiveness is very difficult for most sales leaders, the reality is that without it, there can be no real change.
Watch this one-minute video on Excuse Making and you’ll completely understand what I mean by “no real change.”
Suppose you could put an end to excuse making. Suppose you were to be held accountable for executing. The first thing you would do is set clear expectations and then hold your salespeople accountable for executing. What would you pay attention to in order to make sure they were executing?
You could look at conversion ratios, but some opportunities move from one stage to another and it’s unrelated to whether or not the salesperson was effective.
You could look at closing ratios, but unless you have a ratio that is definitive of success, all actual ratios are simply relative to the goal, to last month, to last year, or to other salespeople.
You could look at activity, but that tends to put all of the focus on the first stage of the sales process. While that could be the most difficult stage of the process, it doesn’t help us determine effectiveness in the latter stages of the sales process.
While we are reviewing our salespeople’s performance on selling activities that have already occurred, it’s also important that we consider forward-looking indicators, not lagging indicators.
Let me propose several areas in which we could measure effectiveness to achieve an overall effectiveness score, while also serving as forward-looking indicators of likely business:
- New – There are so many sales roles today, and each has a different level of responsibility for getting opportunities into the pipeline. A broad term like “new” allows us to redefine what “new” represents for each role in the sales force. Based on the definition, we should be able to rate the level of execution for each of those roles.
- Conversations – Before demos, proposals, quotes, presentations, samples, references and even qualification, salespeople must, at minimum, get their prospects to engage in a conversation, discover their compelling reason to buy, and differentiate. They should have developed a relationship during this conversation. Based on what the salesperson is able to convey about their conversation, we should be able to rate the level of traction they achieved.
- Thoroughness – Qualified opportunities don’t necessarily measure a salesperson’s effectiveness. While getting to the decision maker is a measure of effectiveness, the spending ability, timeline, incumbent vendor and internal politics are not a measure of their effectiveness. A better measure of effectiveness is a salesperson’s ability to be thorough, uncovering information like this, even if that ultimately disqualifies an opportunity.
- Qualified Win Rate – Most companies measure win rates, but it’s often one of two formulas. Either it represents the percentage of total opportunities that become sales, or it represents the percentage of quotes/proposals that convert to sales. The problem with both of those formulas is that they don’t take into account whether those opportunities were ever closable. However, if our salespeople are only quoting and proposing to qualified opportunities where the Conversation and Thoroughness have both been rated, we will have a more quantifiable metric from which to work.
Image credit: vladyc / 123RF Stock Photo