I read an article about how to be a successful sales manager. One of the pieces of “insight” was to manage and coach by results versus micromanaging or counting activities. He goes on to say, “people will find their own path to the target…..”
Well, yes, but……..
There are a lot of problems with the advice, it sounds good, but when you dive in, virtually all elements become problematic. The author got 85% there—but missed the most important 15%.
Let’s dissect it.
We expect, measure, and compensate our people on results. But we know results and outcomes are a trailing indicator. By the time we see the results, the things we did or didn’t do are long in the past. Trying to dissect why the results were or were not achieved becomes very difficult. Did we qualify the customer correctly? Did we create value in each interaction, did we understand what the customer was trying to achieve, did we engage the right people on the right things at the right time?
It’s hard to figure out the cause-effect chain of interactions that produce the result. And then if, by chance, we do, the conversation might look like, “Remember that meeting you had two months ago, what if you …….”
Coaching has the most impact if there is an immediacy about what we have observed.
Then there’s the problem of time to new results. If somehow we are able to dissect the results and coach a person, helping her to discover how to improve their performance, then we won’t see the results of that coaching until they have leveraged it to produce new results. If your sales cycle is very short–a few meetings over a few days, that may not be a problem. But in complex B2B sales, we typically see sales cycles extending over many months.
So coaching based on results is irresponsible–both for the people we are coaching and for our own organizations.
The counterpoint, micromanaging and counting activities is a fair point. Too many managers spend too much time on activity metrics, “You didn’t hit your call volumes today, you need to improve that….”
Alternatively, we use activity metrics in the wrong way. If they aren’t producing what we need to produce, the answer is always to increase the volume of activities until the produce what we want. If 100 calls or emails don’t produce the required number of meetings, then we should do 200, 300…. until we produce the required number of meetings.
Too many managers and sales people think the activities are ends in themselves. This is compounded by a failure in understanding how to set the activity goals.
We need to set and track activities–just the few that are most important.
Setting activity goals needs to be based on the outcomes/results we expect, working backwards establishing the appropriate activity goals that are likely to achieve those results.
Let’s look at some examples:
Pipeline coverage is a critical indicator of our ability to meet our goals. Yet, somehow, most managers say, “Your pipeline has to have 3 times coverage!” But this may be (usually is) an incorrect goal. If a sales person has a 50% win rate and the right average deal size, her pipeline only has to be 2 times. In fact forcing her to get 3 times, diverts her from working her pipeline effectively.
And if the sales person has a 20% win rate, a pipeline coverage of 3 times means the sales person will miss their goals!
Yet too many managers blindly set this 3X metric and
beat sales people up, I mean “coach” sales people, “You need to get more in your pipeline!”
With my team, a critical activity metric is “number of high impact prospecting conversations per week.” My number is 6, Marc’s is 8, Todd’s is 8, Jerry’s is 10….. Each of us has a different metric based on our quotas and understanding how many prospecting conversations we need to find and qualify the right number of opportunities. I know if I don’t have those 6 conversations, I won’t make my goals in 12-15 months.
The other mistake we make about activities, as I’ve mentioned, is we focus on the number and not what it means. If, for example, Marc starts to consistently miss his number of 8 conversations a week, I need to sit down with Marc to understand why. What’s causing him not to be able to achieve that goal? Should he be doing something differently? Should we be doing something differently? Is the goal the right goal?
Missing the activity goal is like a red flag. It alerts us to something that’s not what we expected, but it doesn’t tell us why it’s happening or what we need to do to correct it. In leveraging activity metrics to coach our people, we must work with them to understand what’s happening, why, what we should do to correct it.
Activity metrics are important. They help us understand the things critical to produce the results we want and help keep us on track. But we have to understand the few most critical activity metrics, how to appropriately set them, and what they mean.
Then there’s the statement, “people will find their own path to the target….” They might, but then again, they might not, or it may take too long. They may not know they are on the wrong path and it is irresponsible of leaders to fail to help their people discover the best path to meet their goals.
Here’s a test of that statement. If we really believed people will find their own path to the target, why do we need to sell? Wouldn’t the customer find their path to the right solution?
I’ll stop here, you get the point.
I suspect the author was trying to simplify the concepts and principles of leadership and coaching. We need to constantly do that, but we need to recognize the difference between simplification and simplistic.