How Your Sales Team Can Double its Win Rate in a Recession

Posted by Dave Kurlan on Mon, Sep 26, 2022 @ 14:09 PM

double

Isn't it awesome when you learn about new tricks your computer, phone or software can do that you weren't previously aware of? I've been using a number of new widgets on the home screen of my iPhone 13 and I love how quickly I can get or enter information!

Isn't it fascinating when you thought you knew what a product was all about but you were wrong?  A client was having great success using OMG (Objective Management Group) to assess their sales candidates and they assumed the sales candidate assessment was the only thing OMG offered.  When they learned that our core offering is evaluating their existing sales team they became excited about what that would mean for addressing their two biggest selling challenges.  

One of their issues was their 20% win rate was much lower than they thought it should be and they believed their salespeople needed some refresher training on closing.  They also had a large number of opportunities stalled in the pipeline and they believed that training on more effective techniques to conduct follow up calls would help.

In this article, I thought it might help if I share a bit of what they learned about their sales team.

It turns out that they didn't have either a follow up or a closing problem.  The three biggest issues were that their salespeople were:

  1. Not reaching the individuals who actually made the decisions to buy their services.  They knew they had to reach that person and  reaching that high in the organization was a milestone in their sales process but only 7% of the sales team was having any success doing that.  We also learned that the salespeople who did get to the decision maker were 400% more likely to close the business than the others on the team.



  2. Somewhat ineffective at Discovery and as such, were not uncovering compelling reasons for their prospects to buy.  Without compelling reasons, there was a lack of urgency and without urgency, there was nothing compelling their initial contacts to get the decision makers involved or the money approved.  The salespeople were simply not getting their prospects beyond "nice to have."
  3. Not selling value. They were focused on selling value, but because they were not uncovering compelling reasons to buy, they were unable to communicate their value in terms that would resonate with their prospects.  As a result, by the time the opportunity was proposal-ready, 50% had reverted to price-based opportunities.

These three issues were not the only issues facing this company but to give you a sense for how crucial these three issues are, read the next sentence three times.  If they were to do nothing else, but they relentlessly trained, coached and role-played these three issues, they would double their win rate next near. DOUBLE THEIR WIN RATE!

Some companies learn that their issues lie within their pipelines because the opportunities are not well qualified or scored.  Other companies learn that their problem is the company's ineffective sales process.  Some companies discover that the problems have more to do with not having the right salespeople in the right sales roles, a selection problem.  At other companies, we learn the problem is ineffective sales management, due to ineffective coaching and/or accountability.  Motivation is the problem at some companies while the thing that looks and sounds like complacency is often a problem with lack of Commitment.

Some companies have sales teams that aren't very effective developing relationships while others have trouble leveraging the relationships to generate revenue.  I've seen some sales teams that weren't very effective at building trust and credibility while other companies had hired salespeople whose Sales DNA wasn't strong enough to differentiate their higher priced products or services in the C Suite.

The problems I mentioned above are a small sampling of the many issues OMG identifies and it might surprise you to learn that many sales teams have all of these problems and more.

You can't fix the sales problems you can't measure.

When you scientifically measure exactly what the sales problems are, who has the problems, to what extent those problems exist and what the complimentary problems might be, you can begin to determine exactly what kind of development, training, coaching, and even organizational changes are required.

Or, you can do what this company was about to do before they evaluated their sales team and hire a sales training company to train on the latest and greatest closing and follow up techniques. After reading the story, you will understand that what they thought they needed for sales training would have never helped - not even a little!

If you are interested in learning more about having your sales team evaluated, you can email me and I'll get your request to the right person. If you don't want to hear from anyone (an example of a non-supportive selling belief that lowers Sales DNA), you can head to this site where you can get started on your own for free.  Full disclosure, at some point you will still have to speak to someone and pony up to receive the deliverables.

Image copyright 123RF 

Topics: Dave Kurlan, sales process, sales training, Sales Coaching, recession, OMG evaluation, creating urgency, sales team evaluation, discovery

Which is Worse - The Boston Red Sox or Your Sales Team?

Posted by Dave Kurlan on Tue, Aug 23, 2022 @ 07:08 AM

fenway

I wrote the best-seller, Baseline Selling, so it should come as no surprise that I'm a die-hard Boston Red Sox fan.  I'll be at Fenway Park for a game this week and I had some thoughts about how the Red Sox compare to many of the sales teams that get evaluated by Objective Management Group (OMG).

The Red Sox are not very good. They have become difficult to watch, and have morphed from a 2018 World Series champion, to a 2021 playoff team, and now to a last place team because their roster was so poorly constructed.  In the off-season and at the trading deadline, the Red Sox waited until the other teams made their big moves and the dust had settled. Then, from among the players that were still available (nobody wanted them), he made some bargain basement signings or traded players who will be due for big contracts and got little in return (again).  The result is a bad team with only a handful of stars and a supporting cast of broken parts, guys playing out of position, and minor leaguers filling in for injured players.  Do you know how bad a team has to be to score ten runs and still lose by five?

Most sales teams that go through the OMG evaluation process have a couple of stars but most of the salespeople are not very good (bargain basement hirings), not in an ideal role (out of position), and aren't contributing to the growth of their companies.

The construction of the Red Sox roster is simply a Stupid as Shit Strategy or SaSS. Use of the word strategy means that it's intentional and is a disservice to the word stupid!

Sales team construction usually lacks formal strategy and that suggests something accidental is at play. We tend to see the "we already had these salespeople" and then "these are the new salespeople who were willing to work for us." New is a relative term as the newest 30% of the team continues to churn when and if they find candidates.

In both examples, we have teams that appear to be underperforming when in fact, they suck because of poor selection.  I'm not letting managers off the hook as they are responsible for coaching up the people on their teams but let's face it.  If the right people were acquired in the first place, they wouldn't require much coaching!  

It's common knowledge that for the past several years, only around 50% of all salespeople meet or exceed quota. Are they underperforming or performing as they should based on their own capabilities?  I mined some data from the 2,242,971 salespeople that OMG has assessed. What follows helps to explains why:

OMG measures the difference between salespeople who can sell versus those who will.  Only 55% of all salespeople will sell.

Only 22% have the necessary Sales DNA (combination of strengths that supports the execution of sales process, sales methodology, sales strategy and sales tactics) to succeed in their roles.

Only 41% have Hunting as a strength and only 34% prospect consistently so pipelines fall short of target.

Only 43% have Relationship Building as a strength and only 29% are able to leverage their relationships to win business.

Only 34% follow an effective Sales Process so most salespeople are winging it while believing they are terrific.

Only 28% Reach Decision Makers but only 11% reach the final decision makers and only 1% of new salespeople reach those decision makers

Only 11% have Consultative Selling as a strength and only 7% get past nice to have.

Only 31% have Selling Value as a strength and only 25% of salespeople make purchases in a manner that support successful sales outcomes.

Finally, 50% of all salespeople are weak!!  Is it any wonder that only 50% of all reps hit quota?

More importantly, CEOs and Sales Leaders don't know what their salespeople are truly capable of because they read only what appears in the CRM application, hear only what their salespeople tell them and see only the monthly, quarterly and annual revenue numbers.  At most companies, the salesperson responsible for the most revenue is often among the worst salespeople on the team.  They might have the biggest and/or best accounts, or the most lucrative territory, decades of tenure in the industry, but they aren't selling as much as they are serving in the role of account manager and order taker.  Don't confuse revenue with sales effectiveness.

A professional sales team evaluation shows what prevents your team from achieving a higher win rate, higher margins, more new business and a shorter sales cycle.  Do you have the right salespeople in the right roles? How much better each can each salesperson become? What it will take to get them there and how long will it take?  Is your pipeline legit? Which of your salespeople can be trained or coached up to reach their potential?  Are your salespeople part of your future or part of your past?

You can guess or you can get the data.  Learn more about a sales team evaluation.  Request a sample.

This article began with poor sales team performance as a by-product of selection.  Start using OMG's sales candidate assessments - the most accurate and predictive sales selection tool in the world. Request a sample.

Image copyright 123RF

Topics: Dave Kurlan, Consultative Selling, sales process, sales assessments, objective management group, sales team evaluation

The Recession is Here - How to Take Advantage and Prepare Your Sales Team

Posted by Dave Kurlan on Tue, May 31, 2022 @ 07:05 AM

crash-landing

You boarded your plane, got seated, the plane pulled away from the gate and you fell asleep.  Later, a hard landing woke you and you wondered, "Are we already there?"  Yes you are and you slept through the entire flight.

The same thing is happening with the economy.  While you were sleeping, distracted by Russia invading Ukraine, baby formula shortages, off-the-chart gas prices, a migrant surge across the southern border, mass shootings, supply-chain shortages, and runaway inflation, the recession crash-landed and it's here.   

The two biggest tell-tale signs are new home sales were 100,000 or so units below expectations for April, and the first of many interest rate hikes have been enacted. And the biggest sign is that government officials continue to tell us that there is nothing to see here, the economy is booming and there will be a soft landing from inflation.  Sure.

While I'm citing events in the United States, there is no doubt that this will be a global recession.

So what must you do to prepare your sales team and how can you leverage the effects of a recession?

You'll know the recession is real when in the next 90 days, sometime between now and the end of August 2022, the first domino falls and a major corporation announces they will layoff thousands of workers.  Others are sure to follow.  Then come the spending freezes.  This trickles down to mid-size and small businesses and while this is taking place, consumer confidence plunges, people stop buying things, which reinforces the decision to stop corporate spending and vindicates them for the layoffs.  We're gonna get clobbered!

You can leverage all of this by hiring salespeople.  That's right.  Resist the urge to layoff salespeople and instead, take advantage of what will finally be a surplus of good to great salespeople.  They have been in very short supply for several years and this will be one positive consequence of a recession.  Gobble them up, upgrade and smart-size your team and use OMG's Smart-Sizing tool as part of a sales team evaluation. Use OMG's sales candidate assessments to distinguish the sales winners from the imposters because past success is NOT a good predictor of future success in sales. You should already know that from experience otherwise your track record would be better and all of your salespeople would be meeting or exceeding quotas.

You must prepare your salespeople so they can convince people who are on a spending freeze to spend money despite the freeze.  This REQUIRES that they be effective at calling on, reaching and engaging actual decision makers as they are the only people who can override the spending freeze.  In addition to developing their skills at engaging decision makers, they must be equally effective at using a consultative approach, selling value and using a sales process optimized for a value-based, consultative approach.  Why consultative?  Selling value doesn't work well outside of a consultative approach.  Not only that, but salespeople struggle to achieve differentiation outside of a consultative approach.

What could go wrong?

OMG has evaluated and assessed more than 2.2 million salespeople and the data shows that taking a consultative approach is where salespeople are LEAST effective.

As you can see, only 11% of all salespeople have Consultative Selling as a strength, only 28% have reaching decision makers as a strength and only 31% have selling value as a strength.  But it's worse than that.  Weak salespeople make up 50% of the sales population.  Weak salespeople don't sell this way!  The next graphic isolates weak salespeople - the bottom 50% - only.

Only 1% of weak salespeople (half of your sales team!) have Consultative Selling as a strength, only 10% have reaching decision makers as a strength, and only 4% have selling value as a strength.

This is why half of your salespeople don't hit quota!  But over the past several years they have gotten by because they have been in order-taking mode.  With demand dropping like a rock and order-taking going away what will you do?  These are the five steps you should take.

1) Evaluate Your Sales Team  to determine who will be part of your future and who was part of your past.  Determine the exact competencies in which they will require training and coaching.  Better understand where the bottlenecks are and what it will take to increase your win rate. 

2) Assess Sales Candidates as you hire better salespeople.

or Request Information

3) Customize and Optimize your Sales Process for a Consultative Approach

4) Get your sales managers trained and coached to be effective and consistent at coaching up their salespeople

5) Get your sales team trained to hunt decision makers, take a consultative approach, and sell value.

The economy might make a crash landing but there is no reason you or your sales team need to do the same.

Image copyright 123RF

Topics: Dave Kurlan, Consultative Selling, sales process, selling in the recession, sales candidate assessment, selling value, sales team evaluation

5 Steps to Grow Sales by 33% in 12 Months

Posted by Dave Kurlan on Wed, May 11, 2022 @ 08:05 AM

I'm a baseball guy and a die hard Boston Red Sox fan but I can't bear to watch them right now.  They are playing the worst baseball since I was 10 years old so that's going back 55 years!  It's not hard to understand why they are so bad because the data tells the story.  Their stats show that as of May 9, 2022 their bullpen has 9 blown saves.  Bullpens rarely blow 9 saves over a full season never mind over five weeks but if you look deeper, they wouldn't be in so many close games if their offense was producing.  Only three guys (JD Martinez, Xander Boegarts and Rafael Devers), are hitting!   Coaches will review game video and hitters will take extra batting practice to work on their mechanics and timing.

Sales teams go through periods like this too but sales leaders rarely seek out the data that would immediately point to the real problem.  They tend to hope things will improve and go from there. However, there are several levels of data to be reviewed so let's take a look.

As the article title suggests, there are five steps you must take to grow sales by 33% in 12 months.  You can't pick and choose as all five are required.

1. IDENTIFY BOTTLENECKS - A quality CRM application, like Membrain, will show your win rates, age in stage, conversion ratios, pipeline velocity, pipeline volume and pipeline quantity and more.  Dig into that data to determine year over year changes and identify where your bottlenecks have been and where they are today.  Be mindful that this is lagging data and are merely symptoms of the real problems!  (My personal favorite is the Baseline Selling edition of Membrain)

2. IDENTIFY THE REAL REASONS - An OMG Sales Team evaluation will explain why you have those bottlenecks and why your team gets the results it gets.  Note which of the 21 Sales Core Competencies are to blame - by team and individual - and more importantly, how much revenue is being left on the table and who is capable of upping their game.  For example, are deals getting stuck because salespeople aren't capable of reaching decision makers?  We know that salespeople who can begin with the decision maker are 341% more likely to close the business!  A training curriculum can be designed from these conclusions. Learn MoreRequest Samples (Request Sample Sales Force Eval)

3. PROFESSIONAL OUTSIDE SALES TRAINING - Provide your sales team with appropriate training to close the competency gaps, improve skills, and achieve better execution.  This should not be a one or two-day event.  Change requires on-going, long-term training to change beliefs, approaches, strategies, tactics and develop skills!

4. DAILY COACHING - Sales managers must provide daily, one-on-one coaching to their salespeople to help them with their individual gaps and improve their Sales DNA.  Only 7% of all sales managers come equipped with effective coaching skills so they will need to be trained and coached in order for them to provide effective coaching.

5. ACCOUNTABILITY - Sales Leaders must hold sales managers accountable for coaching as sales managers hold their salespeople accountable for change.

Once you have the data and take action, there is absolutely no good reason why you can't bump sales by at least 25%!  That's right, AT LEAST 25%.  If everyone improves by just 10% you will grow sales by 33%!

  • 10% more opportunities
  • 10% higher average sale
  • 10% greater win rate

That comes out to 33%!  Don't believe me?

Start with monthly goals of 20 opportunities, a 20% closing rate, and a $20,000 average sale. That translates to 4 sales for $80,000 or $960,000 annually.  10% more equates to:

  • 22 opportunities
  • 22% closing rate
  • $22,000 average sale

That's 4.84 sales at $22,000 which totals $106,480 per month or $1,277,760. A 33% increase in revenue!

What are you waiting for?

Topics: Dave Kurlan, sales training, Sales Coaching, crm, omg, how to increase revenue, sales increase, membrain, sales team evaluation

Do You Know the Accurate Reason Why a Salesperson Is Not Performing?

Posted by Dave Kurlan on Wed, Apr 20, 2022 @ 13:04 PM

failing

How quickly can you determine why a salesperson is failing? 

Dinger loves to play catch with his ball.  He has seven of them but loves his white ball the most.  When we're out playing catch and I point to a ball and say, "there it is" or "right there" or "get it" he just can't seem to find it!  Dinger has good listening skills but his ability to see the obvious isn't very good.

Such was the case earlier this week when a surprised client wanted an explanation for why one of their salespeople, who does not perform very well, scored well on his evaluation.  "How can someone who is not my top performer score better than someone who is my top performer?"

That sounded like a challenge so I said, "Let's go!"

Objective Management Group's (OMG's) evaluations are very accurate so I always assume the evaluation is correct and simply ask questions to determine whether something needs explaining, or they might not be looking at the best data to determine whether a salesperson is truly a top producer or an under performer.  The most common pushback occurs when someone they have inappropriately labeled as a top performer does not evaluate very well.  In almost every case, it's because the salesperson manages more revenue than anyone else, but isn't the one who sold those accounts.  A good account manager, but not a producer. 

In the case of this evaluation, the salesperson was simply not performing as well as his peers so I assumed there was a good explanation.

I'll share what I found.

First I looked at his 5 Will to Sell competencies which include Desire, Commitment, Outlook, Motivation and Responsibility - all specific to sales - and while I expected to find an issue with commitment, I did not find the issue there. 

Next I looked at the 6 Sales DNA competencies, expecting to find an explanation there and while his Sales DNA is only fair at best, at 67 it was certainly not the primary source of the problem.

Next I looked at the 10 Tactical Selling Competencies and found what I was looking for.

He scored an 8 on Relationship Building!  If you look at these 10 scores in the proper sequence, he's a hunter who can reach decision makers and when he schedules a call or face to face meeting, and they talk with him, he isn't able to connect with with his prospects. 

He scored 84 in the Hunting competency but that's deceiving!  What prevented him from scoring 100? If you look at the attributes in the Hunting competency below, there are two important attributes he's missing. The first is Likable!  If a salesperson isn't likable it's very difficult to get beyond that!! They simply won't perform!  The second is Maintains Full Pipeline. Clearly, he struggles to convert the scheduled calls and meetings into opportunities.

The answer is always in the OMG evaluation but you need to look at more than a single score!  At a bare minimum, read the dashboard where these scores come from.  You don't have to read 30 pages but at least read the first 2 pages!

Going back to my opening paragraph, "Right there!"  "There it is!"

Clients use OMG's Sales Team evaluations as a development tool to uncover sales skill gaps, opportunity for growth, and most importantly for answers to age-old questions like, why aren't we selling more?  Why is our win-rate so low?  Why aren't we generating more new business?  Why do so many opportunities come down to price?  Are our salespeople in the best roles for them?  How much more business could we be generating if we coached and trained on these gaps?  Are we hiring the right salespeople?  Are our sales managers coaching effectively? 
Samples
Free Sales Team comparison (limited reporting)
Learn more

Clients use OMG's Sales Candidate Assessments to hire the ideal salespeople for the selling roles they wish to fill.  
Free trial.
Sign up.

Sales consulting and training firms choose OMG for their clients because it is sales specific, and is more comprehensive, more accurate and more predictive than any other assessment you can find.  Sales consultants and trainers can learn more here.

Image Copyright 123RF

Topics: Dave Kurlan, accurate sales assessment, sales results, preditive of sales performance, listening skills, sales team evaluation, failing salesperson

The Philosophy of a Pitching Coach Will Improve Your Sales Team

Posted by Dave Kurlan on Mon, Apr 04, 2022 @ 07:04 AM

pitching

I find ideas and material for this Blog everywhere, especially when I'm not looking for them. Yesterday I received a daily email from a Paul Reddick, a baseball coach who was drumming up some business for his baseball institute. It resonated - not for its baseball coaching - but as sales coaching.  Here's what it said:

If your coach is talking about any of the pitching flaws that you see listed above…

Run… Run Fast!

That Coach is working on “flaws” that will have no impact on your pitching.  He is working on symptoms… not the illness!  He is trying to fix things that are happening as a byproduct of incorrect movement early in your delivery. If you get the first second of your delivery right, almost all of these flaws get fixed instantly. 

Do you know how this applies to sales? 

I'll explain exactly how it applies and I promise you will be surprised!  Click here to read last year's fun article comparing pitcher's fielding practice (PFP) to role-playing in sales.

If a CEO, Sales Leader, Sales Manager, Sales Coach or Sales Expert suggests that closing or negotiating is a selling flaw, then that individual does not really understand what salespeople must do in order to win business.

Closing is over-rated. 

Always has been.

Except for the concept of when to close, closing shouldn't even be taught!

If a salesperson is effective adding opportunities to the pipeline, reaching decision makers, building relationships, taking a consultative approach and uncovering compelling reasons to buy, selling value, qualifying, and doing that in the context of a effective and efficient sales process, they will earn the business and it will close at the appropriate time.

If they suck at any or all of the nine competencies referenced above, then the lack of wins will appear to be a closing issue, when it is actually symptomatic of something that wasn't properly executed earlier in the process.

Same goes for negotiating.  If an opportunity is properly qualified at the appropriate time, there should not be anything to negotiate.  However, if qualifying lacks thoroughness and is completed too early, it invites a negotiation at closing time.

Training and coaching should be targeted towards the competency in the sales process that has the lowest conversion ratio.  In other words, if salespeople struggle to get opportunities into the pipeline, focus on prospecting.  If salespeople are booking meetings but opportunities stagnate in the pipeline, the issue is with the consultative approach and/or value selling.  If opportunities get as far as qualified but fail to close, then the issue is probably with qualifying and/or consultative selling/value selling.

The most important thing to identify is where ALL of the skill gaps are.  How can salespeople leverage their strengths, sharpen existing skills, learn new skills and improve their conversion ratios?

The best way to do that is to know exactly what they are capable of, where their bottlenecks are, what their blindspots are, and what they need to do in order to improve.  This should never be a guess because most sales managers, sales leaders and CEOs guess wrong!  It sounds like most of the calls and emails I receive where the potential client says, "Yes, we're looking for someone to provide some sales training on closing and negotiating."

There are a couple of ways to find out what your team is really capable of and how much better they can become:

An OMG Sales Team Evaluation is the best solution and provides answers to every possible question you might have about your team.  In addition to the comprehensive Sales Effectiveness and Improvement Analysis (SEIA), Executive Summary, and Visualizer (interactive tool to play with the data), you and your sales team will learn how everyone measures up in all 21 Sales Core Competencies.

Request Samples

Email for more information

OMG has a free self-serve solution as well.  You can see how your team collectively compares to other teams in your industry and to companies overall in all 21 Sales Core Competencies.  You won't get any reports or individual results but you'll see where the team-wide gaps are.

Check out the Free solution (or first step)

Companies that have their sales teams evaluated experience faster, quicker and greater growth than those who don't.

Image copyright 123RF

Topics: Dave Kurlan, Consultative Selling, sales process, Closing Sales, sales assessments, sales team evaluation

Salesenomics - Many Sales Organizations Are Stuck in the 1980's

Posted by Dave Kurlan on Mon, Nov 22, 2021 @ 07:11 AM

1980s

Today is moving day for Objective Management Group.  When we first toured our new space, John Pattison, OMG's COO said, "It looks like something the 1980's barfed up!"  I'm happy to report that thanks to big-time help from PENTA Marketing CEO Deborah Penta, our new space is bright, cheery, modern, energetic, open and functional! 

Thinking about the 80's got me thinking...

When was the last time you saw a black and white television or even a console color TV?

How about an electric typewriter?

Or a car that didn't have anti-lock brakes?

You would have to return to the 1980's to see those things and when it comes to their operations, some sales organizations are still in the 1980's.

For example, check out these statistics from OMG's evaluations of 30,000 sales teams and more than two million salespeople.

31% of companies don't use CRM.

44% do not have a way to track the opportunities in their pipelines.

89% do not qualify their proposals.

39% do not track whether their salespeople are under/over quota.  

54% do not track win rates

51% do not know their average order size

74% do not track the length of their sales cycle

40% do not track the number of opportunities in the pipeline

65% do not track the quality of the opportunities in the pipeline

35% do not track margins!

90% do not track the number of meetings required to close

96% do not track the cost of a sale

Unfortunately, there is more, but these are the head turners and it makes me wonder...

It's been widely reported for years now, that fewer than 50% of salespeople are hitting quota.  From the data shown above, we know that 39% of companies don't even track that.  What percentage of their reps do you think are hitting quota?  My guess is less than 20% (think 80/20 rule) so how much worse would it be if those companies were included in the data?  I'm guessing we would learn that fewer than 33% of all salespeople are hitting quota.  That's much closer to what I hear from companies every day.

We are no longer in the early stages of the information era.  Data is king so how can companies operate without this crucial information?  Even prior to the dawn of the information age, companies found ways to track this information, so why would some choose to ignore this today?

I'm guessing that most of the companies in question are small with less than $20 Million in revenue and fewer than 8 salespeople.  I assume that they are not tech companies and probably come from older industries, like building materials, small manufacturers and small industrial distributors.  But I'm just guessing.

You can easily track everything you should be tracking with the right CRM application.  OMG has an integration with what we believe is the best sales-specific CRM application in the world, Membrain.  It's user-friendly, ideal for complex sales, easy to customize, produces the most important data and reporting out of the box, and you won't have to nag your salespeople to use it. And for fans of Baseline Selling, there is a BLS specific edition of Membrain too.

Image copyright 123RF

Topics: Dave Kurlan, sales pipeline, crm, omg, KPI's, objective management group, sales team evaluation

How To Stop Sucking by Understanding and Changing Your Sales Metrics

Posted by Dave Kurlan on Mon, Aug 30, 2021 @ 09:08 AM

metrics

[Note - this article was written in August of 2001 so while the first paragraph is outdated, it still sets the stage for the sales part of the article which begins with the third paragraph.]

The CDC is back focusing on COVID case numbers.  Earlier this summer, Massachusetts was reporting fewer than 100 new cases each day but more 1,000 new cases per day have been reported for the past two weeks.  That particular metric supports the narrative that the Delta variant is spreading but it does not tell the real story that allows us to assess our risk.  

 

 

For the real story to materialize, we should know how many of those 1,000 cases occurred in vaccinated people, how many vaccinated people with COVID have symptoms, and how many of those cases required hospitalization.  Case numbers support that there is new spread, but a detailed breakdown would help us to understand our reality.

The exact same thing is happening with the sales numbers reported by most companies.

Suppose a company reports that its win rate is 24%.  Does that tell you anything other than they suck?  It doesn't tell us how badly they suck, why they suck, how long they've sucked, who sucks, or whether there is any hope for them to stop sucking.  And even if their win rate is double the 24%, the same questions apply. Let me explain.

How badly they suck depends entirely on the stage in the sales process from which the conversion is being measured.  Win rates are not calculated consistently so a 24% win rate could mean five different things:

  • Proposals to closed - if they are only closing 24% of their proposals they are demonstrating the highest possible degree of suck.
  • Qualified to closed - if they are closing 24% of their qualified opportunities they suck at qualifying!
  • Prospects to closed - if they are closing 24% of the opportunities that move past a first meeting, that could be an acceptable rate.
  • Suspects to closed - if they are closing 24% of the prospects they get first meetings with that is something to brag about.
  • Leads to closed - if they are closing 24% of their leads they are freaking awesome!

Every company handles this conversion differently but in my opinion, proposals to closed provides incomplete information because we don't know how many companies they were competing against.  Prospects to closed, suspects to closed and leads to closed are inferior because we don't yet know if the opportunities are thoroughly qualified. Therefore, only qualified to closed provides the intelligence to determine how badly they suck.

Knowing why they suck requires that a sales process includes all of the required milestones and the milestones have also been integrated into their CRM.  We need to know how many qualified opportunities failed to meet all of the company's criteria/milestones be be fully qualified.  If you want to know which milestones should be included, watch this ten-minute video on the most popular sales processes and methodologies.


In order to know how long they've sucked, look at win rates over time using the exact same criteria that is being used today for comparison.  What was the win rate last quarter, and each quarter before that?  Are we trending up or down or is it the same as it was earlier in the timeline?

Who sucks? Unless your reporting includes win rates by salesperson, you won't have the ability to see how you arrived at 24%.  You probably have someone who is closing closer to 50% and there is probably someone closing closer to 10%.  Why is that?  What are they each doing that is so different?  

Is there any hope that they can improve?  This is the most important question of all.  The other metrics we were discussing report lagging data and won't be of much help.  Improvement must be forward looking and the best forward looking metrics have nothing to do with win rate and everything to do with the pipeline.  Is it larger than last quarter, prior quarters and prior years?  Do the opportunities in the pipeline have a larger value than over the same period of time last year?  Is the quality of opportunities in the pipeline higher than it was over the same period of time last year? 24% of 200 opportunities is better than 24% of 100 opportunities.  24% of $2 million is better than 24% of $1 million.  And if the quality is better that would suggest that the win rate will be better than 24%.  That is one way to answer the hope question. 

The other way to measure hope is to conduct an OMG (Objective Management Group) evaluation of your sales team. OMG's evaluation is unique in that it will very clearly show why salespeople aren't selling more, the specific sales competencies where the gaps are, who could be selling more, how much more, the required coaching and training to get them there, how long it will take to get them there, and so much more. Most companies feel that the money spent on an OMG Sales Force Evaluation is the best money they ever invested in sales.

You can get a sample of an OMG Sales Team Evaluation here (checkmark next to sales force eval).

You can see data on the 21 Sales Core Competencies here.

You can learn more about a sales team evaluation here.

Image copyright 123RF

Topics: Dave Kurlan, sales process, sales pipeline, sales backed by science, sales metrics, sales milestones, sales team evaluation

Content not found
Subscribe via Email

View All 2,000 Articles published by Dave

About Dave

Best-Selling Author, Keynote Speaker and Sales Thought Leader,  Dave Kurlan's Understanding the Sales Force Blog earned awards for the Top Sales & Marketing Blog for eleven consecutive years and of the more than 2,000 articles Dave has published, many of the articles have also earned awards.

Email Dave

View Dave Kurlan's LinkedIn profile View Dave Kurlan's profile

Subscribe 

Receive new articles via email
Subscribe
 to the Blog on your Kindle 

 

 

Most Recent Articles

Awards  

Top 50 Sales & Marketing Blogs 2021

Sales & Marketing Hall of Fame Inductee

2020-07-20_14-45-52


 

2020-Bronze-BlogIndi

Top 50 most innovative sales bloggers

Top100SalesInfluencersOnTwitter

Hubspot Top 25 Blogs

 

2020_Top20_Web_Large_assessment_eval