It’s a new year, which after a holidays season of family, food, football, and winter weather means the inevitable look forward to 2015. If you’re like most senior sales leaders, here’s the tension you may be feeling: According to CSO Insights, companies are arriving at an average 16%+ year-over-year revenue target increase, yet the percentage of CSOs with some or clear concerns on meeting those targets is greater than 60%.
Don’t choke on that dessert! Here at CommercialTribe, we’re thankful for our friends at Cracking the Sales Management Code and their 3-part framework, which can simplify what’s in front of us all. Get your free copy of the first two chapters, including a much more cohesive breakdown, here.
Business Results – This is the easy part. These are the targets handed to sales every year, which can be broken into three buckets: 1) Financial, 2) Satisfaction and 3) Market Share. For most sales organizations we talk to, it’s as simple as next year’s revenue target (Financial).
Now that you know what you need to do, the question is how to do it. This is where Sales Objectives come in.
Sales Objectives – There are many ways you could get to your revenue target, but as sales leadership, it’s up to you to determine which levers make the most sense. These levers, otherwise known as Sales Objectives, break into four categories: 1) Market Coverage, 2) Sales Force Capability, 3) Customer Focus, and 4) Product Focus.
In other words, you may decide to meet with a certain percentage of an identified market segment (Market Coverage), create a Sales Certification program (Sales Force Capability), sell to a certain customer segment (Customer Focus) or aim for selling a specific solution at an average deal size (Product Focus).
Now you know the levers you’ll need to pull to get to your Business Results, but you’re not home yet. This next part is the connection many organizations miss. Of the 306 metrics that Jason Jordan and the research team from Cracking the Sales Management Code found sales organizations were tracking, only 17% of them fell into the next bucket. And the next bucket, Sales Activities, are the actual things that can be managed.
Sales Activities – These measure what the sales force actually does. If you have the right activities, then manage them relentlessly to achieve your objectives. If you’re not sure what these activities are, you probably have a lot of managers and reps using their own judgment to determine how to meet their goals. That’s a long-term recipe for disaster. Sales Activities fall into five buckets: 1) Territory Management, 2) Account Management, 3) Opportunity Management, 4) Call Management, and 5) Sales Force Enablement.
For example, you might create scheduling campaigns to track penetration in a specific market segment (Territory Management), then set up a process to track staged interactions in your sales cycle (Opportunity Management) and measure the percentage of reps who’ve completed training to execute the message delivered during Discovery, Demo, and Proposal stages (Sales Force Enablement).
It seems reasonable enough, but most sales organizations don’t take the time to guide their reps on exactly how best to achieve Sales Objectives and even worse, some just start and end with a quota. It’s now up to the rep and front-line manager to determine how best to get there.
Business Results are the things that investors, the board, and management care about, but are simply the outcome of the objectives you select. Sales Objectives are the levers you can pull, but only by managing specific activities. Sales Activities are what the sales force actually does – the only part you can directly manage.
No need to be anxious. Kick back, enjoy some downtime, and be thankful that you’ve now got 2015 in the bag!