Is your sales team not closing deals they should be able to close? Are they failing to take enough orders? Are they losing big deals but getting the little ones? Have you noticed your company losing customers to the competition? Do these problems get automatically blamed on bad or no leads, tough economy, offshore competition, products, etc?
If any of these are true for your company, you need to know the causes and how can you identify and fix them.
One of the largest contributors to the underlying lackluster sales results of low achieving salespeople is having to report their key result area and/or key performance indicator (KRA/KPI) figures.
Many feel that collecting and reporting their activities is like having big brother watching over them and just a time-waster. Once they are handed in nothing ever comes of it.
The reality is that what gets measured gets done! Baseball, football, tennis are a few examples of activities that capture their KRA/KPI statistics and make good use of them.
“What gets measured gets done.” It’s an adage often heard in business and other areas, and it may date back to Rheticus in the early 1500s. Its power lies in the related truth that, “If you can measure it, you can manage it.”
[quotes]Regardless of the starting place or the words used, the message is apparent: Measuring something provides the data that you need to determine if you are moving towards or away from your targets.[/quotes] It allows you to identify what’s working and what’s not working, providing the facts and data needed to make effective decisions.
In a visit to your doctor’s office, the doctor always looks at the patient’s vital stats (KRA/KPI), how else could your doctor have a starting point to determine your current health?
But what does that mean, precisely? How does measuring your weight ensure weight reduction? How does monitoring monthly sales statistics accurately result in getting the money?
Two Ways That Measurement Leads to Goal Achievement
How regularly have you heard or said, “It’s no longer one of my performance goals, so it’s not a concern for me.”
This isn’t the mindset we are hoping for, yet for many salespeople, the simple step of measurement influences them. Some see it as using coercion to perform – a “Do it or else!” tactic that creates undue stress – making it a poor long-term strategy for success. However, in others it can have the opposite effect, creating “eustress,” that is, good stress. [quotesright]Eustress is a stimulus in mind that results in a positive reaction to the stressor. [/quotesright]
The word eustress refers to “properly strain,” its opposite is distress. Eustress captures that healthful reaction to the positive pressure we feel while something is attainable, yet almost too far out of reach.
Research suggests that the desire to win is heightened at the point where competition and time pressure coincide, and the simple process of measuring something sparks that sense of competition in many people.
That rivalry doesn’t need to be with others, it could be with one’s own self as a type of “opposition” to test yourself against and outperform. Without a bogey, a thing to measure your achievement against, there's no way for you to determine whether you have the level of motivation required to accomplish something.
When we set targets and measure overall performance relative to that goal, we have the key to holding ourselves (and others) accountable for success or failure.
When we have concrete information, it indicates what we did or didn’t do, what the impact has been, and what we may need to do differently. [quotesright]Without being accountable, we can’t manage and mentor others, helping them grow and move closer to success. [/quotesright]
Is that all it takes?
Can we measure something and it'll magically transform? Sadly, it’s not that easy. In addition to things like sales plans, sales processes control, presentation skills, prospecting skills, and closing skills, there is a bit more to it than simply measuring the right activities in the right way.
There are some things that you can do that are both helpful, and significant. If you oversee business analytics give these a shot:
1. Recognize the difference between a measure and a metric.
A measure is one quantifiable number that counts a widget or activity. For example, We had an increase in sales of $250,000 in the third quarter. A metric is the better statistic because it compares the measure against a baseline, as in, We made $250,000 in sales last quarter, $100,000 more than the period last year.
2. Understand the distinctions of an Outcome metric and a Performance metric.
- Outcome metrics tell you what the end result of something is. It’s a “lag measure,” due to the fact that once you have the measure, it’s accomplished. Over. Done. There isn’t anything you can do now. For example, We made $150,000 in sales remaining sector, $75,000 more than the same period last year.
- A performance metric tells you how nicely the actions are performing that have been determined to be indicative of a future outcome. These are “lead measures,” because they're correlated with the outcome in advance and predict the size of that outcome, such as: For the last three weeks we've had an average of 20 sales calls, exceeding our target of 15 sales calls per week. (We know that level of activity correlates with a sales level of $150,000 over the period, provided the same level of activity persists.)
3. Decide what you need to know before the measuring starts and plan for how you will get the needed information.
As mentioned earlier, reporting is often seen as a waste of time, resulting in data that aren’t accurate or are unavailable. This will NOT provide the motivational metrics and measures that create eustress and increase performance.
4. Design your report to tell a compelling tale.
Once the right information is being measured and collected, the database should capture tips, observations, and interesting facts to guide the reader to the crucial points. Make the reporting visible, exciting, and helpful; when done well, you will have a hard time keeping up with the interest levels of the team.
Measurement is key but knowing how to sell today means knowing the fundamentals, buffing up and polishing your sales skills and learning the new approaches that are required when dealing with today’s more knowledgeable and informed buyer.
Assess Your Sales Team’s Skills
Do you have any of these symptoms of sub-par sales performance?
- If you have salespeople who are cold calling superstars but cannot close the ideal customer, get them to step back and change their focus.
- Success breeds ego, but past victories aren't any indication of potential future wins if a salesperson is resting on the laurels of their past achievements.
- The opposite problem is just as bad for business: salespeople who doubt their own skills. Sometimes this occurs after a prolonged sales drought or when they don't agree with or have lost the passion and enthusiasm for the product they're selling or the company they represent. The cure is to identify the attitude issues in your company and repair them, right away.
- They ask questions that don’t engage the prospect, or when they do ask a question that engages the prospect, they aren’t 100 percent focused on what the prospect is saying. Instead, they are thinking about what to ask next or simply distracted by personal concerns.
- They’re bashing heads with the marketing guys, blaming them for lousy, low-quality leads.
[quotesright]If your team is not making sales, look at your business processes and existing policies as a source of the problem. [/quotesright]
- Do you have systems and procedures that place the prospects and customers first?
- Do you have a system that provides feedback on performance opinions on a daily basis?
- Does your customer service group have a system to rapidly get customer problems escalated and resolved?
- Do you know the key components of your follow up prospecting strategies that are designed to nurture prospects until they are ready to buy?
If your sales group is disorganized, stressed, and flying by the seat of their collective pants, it is probably because there wasn't a solid method in place to start with.
As with many things in business, it’s complicated but it’s typically something you can fix quite rapidly… if you can spot the underlying causes. The good news is that there are experts who can help sort out this type of situation and get sales back on the growth track. Let’s talk, Brian Tracy USA: 877.433.6225 Email Me feedback@focalpointcoaching.com