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Sales Productivity in 2011 : What Are the Big Picture Issues?
In today's Focus Roundtable, Joe Galvin, Jill Konrath, + Marty Michael shared their views on the things saavy firms will do to improve sales productivity in the coming year, namely [better, deeper, metrics on pipeline performance] from which firms will gain [faster insights into what Reps are ACHIEVING from what they're DOING] which will trigger [honing of sales skills] through which every path to improved sales productivity must pass. What's your take?
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- Dos and Don'ts of Small Business Marketing May 29 @ 11 am PT
- Lead Nurturing 202: The Next Generation May 31 @ 11 am PT
- The Tricks to Paid Media June 6 @ 11 am PT
- Display Advertising for Brand Awareness June 20 @ 11 am PT
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3 Answers
John,
please allow me to extend a point Joe Galvin made in the Roundtable discussion about the unsuitability of financial ratios to manage productivity. It reminded me of a quote from Einstein: "Not everything that can be counted counts, and not everything that counts can be counted". The financial ratios are though the lingo used at the senior executive level. At that level productivity improvement is often also synonymous to efficiency improvement.
Neil Rackham though has brought forward evidence already many years ago that especially in complex sales situations, productivity improvement is mainly obtained through improved effectiveness; and less through higher efficiency. The deeper insight into the pipeline, you mention, allows to measure effectiveness improvements.
Here is though the dilemma. These parameters are leading indicators towards the financial ratios. IMO: It is crucial that the senior executive level accepts this fact. If they continue to measure their financial ratios in inapropriate intervals were productivity improvement at that level is not yet visible, they will trigger these "knee jerk" reactions Jill Konrath mentioned in the Roundtable discussion as a major inhibitor to sales productivity improvements.
In "Managing Major Sales" Rackham and Ruff explain that efficiency measures can be imposed top down from the senior management level, while effectiveness improvements are primarily due to better first level management involvement.
Putting together the senior executive level's inclination to equate sales productivity with sales efficiency and their ability to easier impose efficiency measures (e.g. asking for more sales call per salesperson) we might understand the motivation for them to trigger these "knee jerk" reactions. We also understand though why these reactions are detrimental to productivity improvements if these depend on effectiveness improvements.
These leads then to the question, why senior executives measure those ratios at inappropriate intervals? My suspicion is that they feel forced by the financial community to take a short term view .
So it will take courageous leaders who are willing, despite this imposed focus on the short term, to provide a climate where first level sales managers can work with their people to improve effectiveness if this is what it takes to improve productivity. I think, with this conclusion, I am paraphrasing what Jill Konrath also mentioned in the Roundtable discussion.
Hi John,
I think marketing impacts and assists need to factor in here somewhere, if we're talking big picture view. Are the leads getting better? Is that impacting what Reps are achieving? Is the sales collateral more focused on the end stages of a buyer's process to help the Rep stay in - or add value to - the conversation?
Or perhaps the flip side is identified. Are specific areas discovered where marketing could contribute to sales productivity's big picture issues - whether through improved lead qualification, educational content focused on specific obstacles buyers face that Reps must help them overcome, etc.?
Since I had a conflict at the time of the call, I'm wondering if there was any definition around the meaning of "better, deeper metrics on pipeline performance?" I'm looking forward to listening to the recording.
Ardath: thanks for your feedback. Great point. Sales + Marketing alignment certainly is part of the mix (and formed part of remarks Joe, Jill, and Marty made). We didn't go far in defining the kinds of metrics that would provide faster, deeper, insight into pipeline performance. However, in a post Roundtable de-brief Joe Galvin made this point: there's a need for metrics on verifiable customer outcomes from every interaction. It's a point echoed by Kevin Davis in his new book 'Slow Down, Sell Faster'. IMO: these are metrics which both marketing + sales need; with such metrics, the blame game will fade + the learning game will blossom. Trust this adds some value. - John
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