A sales manager faces many daily frustrations in sorting through and figuring out all the risks that must be estimated, taken and not taken.
A large part of the reason for this frustration is that a sales team is made up all kinds of divergent elements. You have everything from sales superstars to mediocre salespeople, and everything in between. You’re always trying to figure how to make the slower team members better, and how to deal with the diva-type behavior that can be exhibited by your stars. It’s a constant struggle to keep it all together and make sales goals.
Art…or a Craft?
The key to making it all manageable lies in turning an art into a craft.
Sales is described by some as an “art” instead of a “craft.” Over the centuries, we’ve seen a number of arts—medicine and architecture being 2 standout examples—that indeed evolved into crafts that could be taught to anyone. While today there are certainly doctors that are considered stars in their field, there are tens of millions of doctors throughout the world. Sales is no different.
So how do you turn the art of sales into a craft? This should be the primary focus of a sales manager.
KPIs: Bringing Sales Management Under Control
For the simple version of the answer, I quote St. Francis of Assisi:
“Start by doing what’s necessary, then do what’s possible, and suddenly you are doing the impossible.”
For a sales manager, the “necessary” means implementing the right Key Performance Indicators (KPIs).
Some companies have gone overboard with the number of KPIs they’re trying to monitor. It’s almost like they’re trying to fly a modern jet plane, with a hundreds of indicators. But even a pilot flying one of these planes, when it comes to landing it, is not trying to cover all of these indicators—they’re focusing on a few very important ones. Which, as it turns out, is what a sales manager should be doing.
KPIs should consist of the right combination of leading and lagging indicators. Leading indicators mean information about the present that is used to influence future outcomes. Lagging indicators mean information about the past: “How did we do?”
Pipeliner CRM works through a working balance of leading and lagging indicators.
KPI #1 is creation—of leads, accounts and opportunities. These is tracked for each person, for each team, and for the company. How many leads are being created, how many opportunities are being created, how many accounts are being created? If you’re in the people business, you could ask how many contacts you’re creating.
KPI #2 is conversion. Now that you’ve created, how many of them are being converted? How many leads become qualified leads, and then a won opportunities? This KPI gives you insight into the efficiency of your sales team and sales process.
KPI #3 is one that many often ignore: lost opportunities. You can often learn more about your process and your efficiency from closely examining losses, than from wins.
For that reason we’ve equipped Pipeliner with the Archive, in which all losses, complete with all data, are kept. Within the Archive you can dive into complex search functionalities, going into any detail regarding a loss: Price? Competition? Product? Team? Product line?
As long as you don’t know why you’re losing, how can you know why you’re winning?
KPI #4 is about examining (for each individual, team and company) the amount won, compared with the goal. This is an examination over time: Are they steadily winning more and more every month, or is it one month up, one month down? It should be relatively stable.
Lastly, KPI#5 is the comparison of won amount against the lost amount. This gives you the overall picture of the effectiveness of your sales machine.
Note that with any of these KPIs, you can dive in and get more detail on specific opportunities, reps and teams, so that analysis—and therefore solutions—can be specific.
Utilize the right KPIs—and bring sanity, stability and success to sales management!
Discover how Pipeliner CRM—with its instant intelligence, visualized—can bring the right focus to sales management. Get your free trial of Pipeliner CRM now.