Literature provides direction for meaningful exploration.....
Data is everywhere and being used more than ever in sales hiring and coaching. CRM data is as critical to running the business and understanding customers, as it is for sales managers to coach their teams. Standard KPIs such as quota achieved, conversion rates, pipeline stats, activity monitors form the basis of what should be mandated daily or weekly check-ins between manager and rep. However, these KPIs only go so far.
While some KPIs do provide a backward-looking snapshot of a salesperson’s performance, they do nothing to help the salesperson or manager understand the everyday behaviors that are responsible for impressive results. KPIs are also only as good as the data that goes into the measuring tool. If a rep is doing a poor job of documenting all customer activity in CRM, then the manager is left with little more than anecdotal evidence in understanding rep behavior and areas for improvement.
McKinsey’s research shows some surprising sales performance variations among sales teams. Sales rep performance in similar districts varies by a factor of three between top and bottom quartile, adjusted for tenure. Inside sales, where turnover is higher than reps, shows performance variance as a factor of two. Traditional KPIs don’t fully explain the variation even when controlled for the right coaching and incentive programs in place.
Enter people analytics..
aka “Moneyball of human resources” to the rescue. People analytics is well entrenched big data technology that draws on aggregated and anonymized data from email, calendar, social media and other datasets to help managers and executives understand how time is invested, and if it’s paying off with increased sales. Put simply, the data helps managers recognize why some employees are not meeting their KPIs and how best to coach them towards improvement. It enables predicting outcomes and improving productivity, allowing teams to course-correct before results come in.
As an example of people analytics in play (at company X), we saw large variation in rep performance that CRM data and standard KPIs didn’t explain. We first needed to understand data that would explain the behavior and then build an appropriate coaching/enablement program to uplift the lower performing reps.
We turned to Volometrix (now part of Microsoft’s Delve Analytics) to work with us. VoloMetrix extracts and analyzes anonymized, aggregated header-level data from email and calendar systems (Information such as who mails were sent to, time in meetings and with customers etc. are examples of data collected) This is correlated to CRM data and quota attainment to understand behaviors and actions that are highly predictive of sales outcomes. Analysis done along two dimensions:
What do top salespeople do differently?
Analysis (data analyzed for sales team from the Americas geography over six months) led to the understanding that top salespeople:
Now, merely engaging with more customers and meeting extensively with internal and external contacts does not a successful salesperson make. There are good old fashioned selling traits that need to be part of the psyche. Critical sales competencies (specifically in B2B selling) include some variation of the following:
Measuring these sales competencies is a more labor intensive process, and involves questionnaires/surveys/forms, and/or a manager’s keen unbiased observant eye over the course of time. It yields valuable data in assessing skills and gaps.
How to structure enablement?
Adults learn best through experiential learning, by getting their hands dirty/walking the walk. Studies (IBM Research) have shown that adults retain nearly 65% of experiential learning but only 10% of a lecture/video. So, coaching directed to enabling reps to learn rather than teaching them works best. This could take the form of one-one daily/weekly sessions and the manager being present at the customer interaction.
This style of coaching takes time and patience but is one that is necessary for superior results. It becomes critical to deliver targeted coaching so the rep knows where improvements must be made i.e. behavior, style, competency etc. Data in various forms, shapes and formats (quota attainment, conversion rates, pipeline build/activity, time spent with customer/networks, sales competency proficiency) needs to be brought together in a structured manner to maximize the impact of coaching for each rep. One size does not fit all.
One way (there are many paradigms to quadrant reps out) is to use quota and pipeline data to classify reps into four quadrants, and focus on specific coaching methodologies, techniques and behavioral/competency improvement plans for each quadrant.
High Performing Sales Rep: is the one who is beating his quota and actively generating pipeline to fill the funnel. These are the reps you want more of in your organization, the type of eps you want your medium and lower performing reps to aspire to become. These reps are aware and have learned/mastered sales competencies, and are exhibiting all the right behaviors (spending meaningful time with customers, expanding meaningful relationships with internal/external networks etc.) This does not mean that they do not need coaching.
They need more of the right kinds of coaching to keep them engaged and committed to your organization. Work them to plan and develop their career for upward mobility or expanded responsibilities, coach them through elevated risk and high reward projects, and ensure they get visibility with senior level leadership and external partners. Many of these reps also derive satisfaction in grooming and nurturing other sales reps, give them the opportunity.
Needs Development Sales Rep: is the rep that is either beating his quota numbers while not generating high pipeline, or displays low quota attainment while actively generating pipeline.
Case 1: High quota attainment, Low pipeline
It could simply be a case of enforcing CRM discipline. CRM discipline is critical and needed to plan and run the business, understand the customer and plan for knowledge transfer if the rep quits/moves on. Reps should not be allowed to slack on recording opportunities and activities in the system. The discipline needs to be enforced from the top. Coach reps through the importance of recording CRM data, no matter how good they are. Not to mention all the technology that is available today to ensure seamless crm information capture. Use it and enable it!
Beyond CRM, some sales reps like to focus on a few opportunities and put all their energy into closing these deals. They are exhibiting some of the right sales competencies and required customer/network behaviors. But is their quota stretching them enough? The process the rep is following is likely not scalable i.e. if quota increased (market trends, product stickiness etc.) is the rep more likely to miss his elevated numbers? Coach these reps through consciously practicing more of the right selling behaviors to keep the funnel fed. Review competencies and coach to specific opportunities.
Case 2: Low quota attainment, High pipeline
These reps need focused coaching on both competencies and selling behaviors. Reps do not like their every move scrutinized, so use high impact coaching techniques (use available data results/analysis to guide your coaching). Spend 1-1 time with reps and coach them through live situations. Focus on driving more consultative selling techniques and be a true business partner to the customer.
Some of the most successful reps are the ones who can get to No fastest. It is better to get a No upfront than a stressful, dragged-out process that is highly unlikely to end in a sale. Time is money. Coach reps to push the envelope on understanding decision triggers at the customer and keep the process moving forward. Good judgement and acumen are key in transferring energy to fruitful ventures. Coach by using lessons from past experiences and from experiences of other successful and less-successful reps in converting pipeline to a sale.
Needs Performance Management Sales Rep: The rep neither generating pipeline and consequently not meeting quota could either be a new hire, completely checked out and looking for a new role, or needs serious help. The new hire needs the right enablement program. The checked-out rep needs a review of motivations and what the company/manager can provide to keep him engaged (call HR and your boss). Perhaps the company culture/management/industry/product is just not the right fit for the rep and best if everyone moves on.
For the rep that expresses interest in staying on and succeeding, managers need to deploy serious coaching chops. Coaching needs to be intense (frequent doesn’t cut it) and experiential i.e. beyond books/webinars/classes. Its learn by doing in live situations, so managers and other reps need to spend time on the road. Coach to clear, agreed upon targets in specific timeframes.
Changes and confidence building don’t happen overnight, however if there is only modest improvement over a targeted timeframe, consider company mandated performance management plans (though I have seen these to be in place for legal reasons than transforming a poorly performing rep, so don’t hold your breath on this one).
Coaching is hard – time, patience, empathy needed in large doses - but can be extremely gratifying. It’s not the amount of time spent on coaching that counts – less frequent but well prepared, in-depth coaching reaps benefits can work as well. It’s a newer age where data is available to strategically plan approach and content for these sessions. Use it wisely to get your reps from good to great!
McKinsey’s research on differences in performance levels in reps can be found in their book on Sales Growth.
Ryan Fuller’s articles on Volometrix and high performing sales behaviors are on Harvard Business Review.
Content credit for this article also goes to K McMahon (HR), much of which was developed during my tenure at Symantec Corp.
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