A sales leader shared his frustrations during a recent meeting. “Our metrics are all on track,” he said. “We made a huge push last year and we’ve finally gotten the reps to enter data into the CRM consistently. We created a bunch of dashboards, and these all show the reps are consistently meeting their targets for phone calls placed, emails sent, and meetings conducted. Our sales funnels look stronger than ever, and yet, a full year later, we’re not seeing any noticeable sales increase over prior periods.”
Listening to this sales leader, I was reminded of a Mark Twain phrase I was introduced to by one of my grad school professors. Twain himself attributed the phrase to British prime minister Benjamin Disraeli, who said “There are three kinds of lies: lies, damn lies and statistics.”
For many sales leaders, the collection and analysis of metrics has become the statistical method of choice for understanding and, importantly, forecasting team performance. Having run sales operations functions since 1995 and experienced the evolution of CRM systems from simple contact repositories to opportunity management tools to today’s process automation systems, I’m convinced these programs are heading in the right direction. But they also bring with them several traps that are easy to fall into and that sales leaders should avoid when designing and using a CRM.
The Black Box of Sales
At their essence, each new generation of CRM systems is aimed at eliminating what sales operations professionals used to refer to as “the black box of sales”: input salespeople and leads at one end, wait for magic to happen, and out the other end come closed deals and revenue. Today’s CRM systems enable organizations to break down their ideal sales process into repeatable steps that can be applied consistently and on which sales reps can be efficiently trained. Thus, many sales processes we see represented in CRM systems are shown as a series of milestones, such as: lead qualification, identification of current pains, solution generation, SOW submission, contracts signed.
While there’s nothing inherently wrong with this design, too many sales leaders focus only on these milestones in designing and using the CRM to manage their teams. These leaders may be sophisticated enough to look beyond simple periodic counts of opportunities by completed milestone; for example, they may analyze opportunity velocity and average pipeline dollar value changes over time. But their primary focus remains on milestone completion.
This approach disrespects the sales process by failing to focus on the factors that serve to “connect the dots” between each milestone. It disregards the fact that a successful sale is really a story, not just a collection of completed tasks or events. In fact, the very same characteristics of compelling, believable stories exist in good sales processes. How do the characters meet? What makes them want to continue their relationship? What do they each want to gain from their relationship? What are they willing to do in order to ensure their needs and desires are met? Successful sales reps can tell these stories with clarity and elegance. Unsuccessful sales reps, like hack writers, bounce from one setting or scenario to the next with no clear strategy or thread, checking the boxes they’ve been told they must check (or failing to check the boxes!) until eventually another suitor wins the prospect’s heart, mind and the sale.
For sales leaders, a sales process that requires reps to complete tasks and achieve milestones but does not also require the reps to create, follow and continually update a sales strategy or plan will not only produce disappointing results; it also denies those leaders the opportunity to maximize the effectiveness of their interactions with their teams. In my experience, the development of strategies and action plans that will help move the sale forward from one milestone to the next is precisely where most sales reps turn to their leaders for help. Look carefully at each of your rep’s pipelines and I guarantee you’ll find that milestone stage where many of their opportunities go to die. Some struggle to get beyond current pain identification, while others just can’t seem to close the deal.
So, what data points should you focus on to determine whether your sales reps have created a winning sales strategy or not? If they have developed a sales strategy, how can you tell what it is and whether they are executing it properly?
Data Points and Plans
There are several data points that will help sales leaders maintain an accurate view of each rep’s performance. These vary in the level of “data intrusiveness” they present. Importantly, they are all based on the premise that every sale is an ongoing story and the data about that sale must be continually upgraded and refreshed throughout the process.
- MEETING NOTES – The best information to inform an evolving sales strategy clearly comes from the notes taken by your sales rep or other participants in client/prospect meetings. If your reps are taking notes and not recording them in the CRM, shame on them. If you don’t require the reps to record notes anywhere, shame on you. This is the easiest and most basic way to get your reps to stop and think about what is happening in their opportunities, but you must make sure they are recording the notes promptly after each meeting or they are sure to forget key details that would otherwise have future planning value.
- NEXT STEPS – Use of a single field for this purpose can provide all stakeholders with an immediate view of tasks and actions the sales rep should be held accountable for. However, unless you monitor and enforce its consistent updating, the values can quickly become obsolete. Try to design the field in a way that holds previous next steps and their associated dates as each rep enters new next steps and dates.
- PRE-ENGAGEMENT STRATEGIC PLAN – If the quality of your sales information recorded during the sales process is strong, you may want to consider requiring the reps to create sales strategy documents for their key accounts. These can vary greatly in the amount of information you require, and most CRM systems provide the capability to design customized plans as tabs within the overall account module. When in doubt, start simple and see how it goes before adding too many individual data fields or you will trigger sales rep resistance to the entire plan.
- CLOSING PLAN – If you are not ready for pre-engagement strategic plans, you might consider at least requiring the rep to prepare a closing plan as soon as the rep believes the opportunity has achieved a key milestone. That milestone should be early enough in the process that your sales leaders can provide meaningful guidance to your reps, since, as mentioned earlier, this is the point where many reps lose steam in their opportunity pursuit.
- PROGRESS CORROBORATION – In other blogs, we’ve discussed the use of data points that can provide some form of corroboration of opportunity progress. For instance, the use of “Relationship Status” fields that track the progression of your reps’ development of personal and professional relationships with decision-makers can corroborate the parallel progress of the opportunities those decision-makers are linked to. Once in place, your leaders can use changes in that field as a critical element in the sales process itself (i.e., How are you doing in developing a relationship with Mr. X related to that big opportunity you are forecasting to close next quarter?”)
Be Careful What You Ask For
The other trap many sales leaders fall into when deploying and using CRM systems is to get too comfortable with what they are seeing. With so much at stake, it’s easy to believe your sales reps have the same level of regard for the integrity of the data as you do. To be clear, they don’t. That’s not because they’re dishonest or don’t care about your system; it’s simply because every self-respecting sales rep simply believes he or she has more important things to do than record a bunch of data into a CRM. Add to that the rep’s natural desire to control this narrative and you’re sure to see data you should regard with a healthy dose of skepticism. One of the most important things your entire sales leadership team must do every day is perform quality assurance on the sales data provided by the reps. Telling the reps to update or revise a data point is not enough. They must follow-up, CONSISTENTLY, to ensure the changes are made correctly and in a timely manner.
Remember, whether it’s a lie, a damn lie, a statistic or a metric, bad sales data is bad for everyone.