The Death of KPI's & Sales Performance Metrics
Are Sales Performance Metrics & KPI’s killing your B2B sales organization?
Twenty years ago, key sales metrics were produced in batches and sent to the sales division once a week via the corporate IT department. The information captured was a snapshot of sales results and closes by account type at various levels, but lacked the sophisticated depth that sales analytics produces today.
I even recall a moment in 1998 when we had completed a $40 million B2B sales canvass and having to wait until 5AM the following morning for the IS servers to chug out the final “official” number. In retrospect, this seems crazy compared to today where we have the numbers available in real-time, and can drill down to the finest level of detail.
You would think that this is a good thing, and frankly, it could be if utilized correctly.
Unfortunately, the more readily available the key performance metrics are, the further it keeps the managers from developing their talent. Sales managers are spending more and more time each year analyzing numbers, and there is no time left to spend on things that can impact the number.
What did B2B sales managers do in the “old days” instead of pulling hour by hour reports? S/he tapped into their people. They coached…they trained…they motivated…and they drove sales. Exponentially! Today, sales turnover is on the rise and sales performance per head continues to decline.
Ask yourself this…If data is the game-changer in maximizing sales performance, why do we continue to struggle to meet the number? The fact is that Sales Behavioral Psychology (SBP)— behaviors that affect attitudes, identity, conviction, and passion—is the catalyst in boosting the numbers, but we are failing to use the metrics as a benchmark to change the psychological behavior that created the number in the first place.
Ah, I know what some of you are thinking. All of this fuzzy “soft-value” stuff.
I hear it all too often. The grizzly old sales dogs recite adages from sales lexicon such as “sales is a numbers game” and “plan your work and work your plan”. I don’t disagree with the value of either of these statements, but they have their place and time.
Nearly every sales organization we work with knows their numbers backward and forward. They have plans on top of plans, a crystal clear view of their sales pipeline, and metrics and KPI’s are the dominant topic at virtually every meeting. Why, then, are most sales organizations struggling to achieve even marginal incremental growth?
Here’s a little secret: KPI’s have become the harbinger of sales mediocrity due to their misuse and overuse. Don’t get me wrong, you absolutely need to know them like the back of your hand. But at the same time, if all of your focus is on the numbers then you can’t very well focus on the people, can you?
Our belief is that people make the numbers…numbers do not make the people. (In fact, this is one of Sage Warfield's core values.)
It seems like 80% of sales management’s time is now spent on data and analytics, and the other 20% is spent telling their sales team about their numbers. And, to make matters even worse, they label this 20% under the category of rep development.
This is why many mature B2B sales organizations struggle to grow 10% per year. They are in a cycle of mediocrity precipitated by their own tools. Sales rep development is not about reviewing numbers, or even sales training. These things are essential, but they are not the holy grail of peak performance.
The lightning rod of maximizing the talent of each sales rep is the soft values. It is tapping into them as human beings…tapping into their psyche. What makes them tick? What is their reason for living? What drives them? What do they love? What do they hate? What do they believe? What are their passions? What makes them do what they do? Who are they, and who do they want to be? And, how do we help them get there?
From my perspective, the development of sales talent is 80% behavioral psychology, and 20% technical knowledge and process.
Sales Behavioral Psychology (SBP) was developed into a sales science by Sage Warfield, and it is one of the cornerstones of our work. I sincerely believe that it is one of the primary reasons that our client's average over 30% sales revenue increase within ninety days.
It seems like every week I meet business leaders, and tell them about our track record of sales performance improvement. The conversation inevitably goes something like this:
Business Leader: How do you do it?
Me: We tap into people as individuals using sales behavioral science and use this to help them to maximize their potential.
Business Leader (eyes rolling): Pffff. Soft values. Riiiight. Really, how do you do it?
Maybe they don’t really want to know the truth. Maybe they think that people are too time consuming, and quite a hassle to deal with. But, most of us have heard the expression “if we do what we’ve always done, we will get what we’ve always got”.
In my opinion, as data mining continues to provide even more advanced sales performance metrics at the blink of an eye, B2B sales leaders will continue to get further and further from their sales people. Analysis paralysis is spiraling out of control, and it is threatening sales organizations from coast to coast.
So how do you go from mediocre to extraordinary? Try unplugging your computer for a week, and spend 100% of your time with the sales team. Let your guard down (be a real guy or gal), and be transparent. Get to know them as people and find out what makes them tick. You will learn more about your organization than you could in a year at your desk, and you probably will see a nice jump in sales too.
In a B2B sales environment where a percentage point or two is a big deal, you may surprise yourself with a double-digit spike in sales. Give it a whirl…what do you have to lose?
Posted October 11, 2013 / By Chris Hickey
Tags: sales consulting, sales consultant, sales turnaround, turnaround management, sales management, sales management training, sales management coaching, sales operations, interim sales management, sales force effectiveness, sales coaching, sales strategy, sales leadership
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