Knowing your metrics is a vital but often overlooked part of any successful sales skillset. It all starts with knowing what to measure.
Are your sales strategies working? Is your team delivering its full potential? Who are you carrying and who is performing? These are all extremely important questions, but many companies don’t know the answer. If you don’t know what you need to measure, you could be making important decisions on inaccurate information.
Understanding metrics
Metrics are crucial. Without them you’ll have no way of understanding if your strategies are working, who’s performing well and where you can improve. Many companies will struggle to get this right. They may gather information in the wrong way or measure the wrong things.
Elsewhere in this blog, we’re covering all sorts of key issues for sales teams from opening negotiations to finishing the deal. We’ve looked at how to manage processes, maximise profitable time and identify potential leads. While all these strategies can be helpful, they mean nothing without execution.
Metrics are crucial. Without them you’ll have no way of understanding if your strategies are working, who’s performing well and where you can improve. Many companies will struggle to get this right. They may gather information in the wrong way or measure the wrong things.
But most of all, metrics used well will help you monitor how your company is listening to your customers. It can also show you how you are using that data to make smarter decisions and follow this feedback over time.
The Numbers Game
Sales is ultimately a numbers game, which makes it highly measurable. In the information age, there is a huge amount of data available and many things can be done with it. But there is no use capturing a lot of data unless it is meaningful and it help drive your decisions.
It is important to build the processes to get salespeople to measure this themselves, using technology to execute your plans. Customer Relationship Management (CRM) tools increasingly capture key metrics automatically as they go presenting back information in clear, easy to understand formats.
This takes a bit of organisation at the start – don’t just use what comes ‘out-of-the-box’, but once you understand what you want to measure, you’ll be in a good position to put all those learnings into practice.
CRM systems are just one tool. There are a whole host of tools and technology out there to help you with with monitoring your performance now (and it shouldn’t be your sales people’s job to find them). It is important to ensure all tools are used to their full potential – and work together to deliver against your plans. What you get out will only be as good as the data going in. Once you know what that data is, and what you’re going to measure, you’ll have a clear framework in place in which everyone understands what they have to do every day, week and month, and so on. This will help you pick the tools to do this job.
This leaves management doing what they do best: focusing on the end of the sales process, developing the strategy and working out, using the metrics, what and where needs more attention.
If you schedule different reviews which happen at a cadence that makes sense – weekly, monthly or quarterly review of sales metrics you’ll have great insights into your operations. When combined with our other lessons about the sales process you’ll have a powerful tool to refine strategy and help you progressively build your performance.
You are what you measure
Different companies will need to measure different things. However, whatever you decide this choice will have a massive influence on your business.
As Dan Ariely, Professor of Psychology and Behavioural Economics at Duke University, Durham in North Carolina wrote in an article for Harvard Business Review ‘you are what you measure’.
His key message in this article was that the metrics and data you put in place will influence your business. These set the rules of the game, they tell your salespeople what they need to achieve to be successful.
He uses the example of CEOs. Those who are judged simply on the day-to-day share price of the company will do everything they can to influence their number, even to the detriment of everything else. This can be a negative as well as a positive influence and may lead to a business obsessing over the short term at the expense of longer-term strategy.
In the same way you should craft metrics which influence the behaviour of your salespeople.
You want metrics which not only influence parts of the sales process, but also their wider sales activity. These can be refined or adjusted over time to make sure they are delivering value.
Some companies are also adjusting metrics to capture aspects of their company mission or values. For example, those which wish to be seen as ethical or sustainable are plugging these factors into their metrics. If salespeople are judged on these issues as well as their final sales tallies they will stick closely to those values. It’s a great way for a business to practice what it preaches.
Steer the business directions
Metrics, therefore, are critical to businesses that want to scale using sales techniques. They give you insight into what’s working well and what’s not. They tell you how you can improve and where you should focus your efforts. Last but not least, they set the rules of the game and will shape the behaviour of your teams and your company’s direction.
All this starts when you decide which metrics you want to measure.
This post is a companion post to the Build Your Sales Tribe Book section on Finishing a Deal – legal agreement basics. If you own the book, thanks for visiting. If you don’t own the book, find out more here: www.salestribe.co.uk
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