May 10, 2016
Activity-Based Sales and The New Sales Manager
Guest post by Urmas Purde, co-founder of Pipedrive.
I first became a sales manager at 21. I had a lot of energy — and no idea about what a manager’s priorities should be. I didn’t know what to focus on, so I tried to focus on almost everything. I never took the time to think about my new job or to understand what I was trying to do in that role. Thinking about my new job would have seemed like a waste of time; I had things to do! Well, I burned myself out. I failed miserably because I didn’t think my new duties through.
The moral of this story: New managers have to take some time at the beginning of their new jobs to understand their goals, their priorities and most importantly their actual role. If you were promoted from the sales team, it might be time to hand over your clients to a salesperson and focus on being a manager now. If you’ve been hired to manage an existing team, now is the time to get to know them and your new company.
For new managers, leading a team of reps can seem overwhelming and mystifying. It’s hard to know when to coach reps, or how to approach them when they need help. I learned the hard way that a solid, activity-based approach can take the mystery — and the ego — out of sales management.
Mapping out the sales process
One of the first things a new sales manager should do: Investigate the sales process, decide which actions lead to results and get everyone on the sales team engaging in those actions. Skipping this first step is the reason many managers fail — it’s not an easy step. It’s intimidating and might even seem boring.
Often — in the sink-or-swim world of sales — incoming managers aren’t given a list of which activities yield the best results. The manager who wants to swim rather than sink should begin tracking key activities immediately, using a reliable tool, like a CRM. Of course, it might take some time to figure out what those key activities are. Often managers correct their course several times before getting it right. It may take weeks, even months, but that will be time well-invested.
I recommend that in the beginning, a manager measures activities on a weekly basis. For example, how many demos did the team do in a week? How many calls were made to new leads? A week is a good period to measure, because although days might vary, weeks are rather comparable, and a sales manager can get early numbers within a month. By the end of the quarter, the manager will know which actions lead to results.
Having activity goals for your reps is an important step in coaching a sales team. Once those steps are laid out, the sales manager will be able to see who isn’t following them, who is and who’s having trouble with some steps.
Coaching your reps
Sales managers typically run into three kinds of reps when it comes to sales coaching.
The first, and most serious, is the rep with an attitude that prevents them from learning. While some attitudes might be easier to adjust, others are be hard-wired into personalities and not worth addressing. Teachability, for example, isn’t something you can instill in a rep. Because of that, you may want to do everyone a favor and part ways with a rep who is less than excited about hearing your input.
If your reps want to learn from you, but are still having trouble, they may be the second type of rep — the rep who is not working hard enough — or the third type — the rep who is not working smart enough. You’ll need some tools to help you figure out which they are. I recommend using action goals and conversion ratios.
For the second kind of rep — the rep who isn’t working hard enough — you may need activity goals to pinpoint their specific problems. For example, you might have figured out that to reach your sales goals, each rep needs to add 20 new leads to the pipeline per week. Alternatively, you might want to count value rather than the amount of new leads. It doesn’t matter, as long as it is addressable for you and for them. If it is, then it’s easy to approach anyone on your team and say, “Hey I see you have trouble scheduling those demos. What’s going on? How can I help you?”
What about the third kind of rep, the one who is not working smart enough? To discover whether or not your reps’ skills are up to par, take a look at your team’s conversion ratios.
For example, you might have figured out that your average ratio from one sales step to another is 50%. Let’s say your ratio from a sales step called “first contact made” to the second step “demo scheduled,” is, on average, 50% within your team, which means every second customer agrees to receive your demo. One rep, however, is having problems. His conversion rate is 25% for that stage; while other sales reps need 10 phone calls to schedule 5 demo meetings, this salesperson needs to make 20 calls. He’s working hard, but he’s doing something wrong.
When you have that information, it’s easy to approach a salesperson and offer help, because you can point to the numbers rather than to the rep themselves. If you don’t have hard numbers to back you up, it’s much more difficult to start those conversations.
Even more importantly, monitoring activity goals will help managers address problems as they happen, rather than at the end of the quarter — or year. You want to be able to help your reps through problems as they’re happening, not when you review your team’s numbers.
Creating a plan for success in sales
Mapping out the sales process may seem like an exercise in sales theory, but not doing so is one of the biggest mistakes sales managers can make.
The reason? Sales results are not under anyone’s direct control, but reps’ actions are. Controlling the controllables should be the goal of any manager.
Mapping and measuring the sales process will allow you to create success in sales through encouraging the right activities. If you fail to do that, you’ll become a referee, managing last quarter’s sales results; and if you’re a referee, you can’t be the coach.
Urmas Purde is a veteran salesman and sales trainer. By the time he was 20 years old, he was already a sales expert — having sold newspapers ads, software, wine, copy machines, computers and insurance. He spent 15 years as a principal at Vain & Partners, a leading sales training company in the Baltics. Dissatisfied with the available CRMs on the market, he co-founded Pipedrive, an activity-based sales pipeline management tool that helps small business sales control complex selling processes. To learn more about his sales philosophy enroll in Pipedrive’s free sales course, Sales Pipeline Academy.