www.inddist.com March/April 2017 / INDUSTRIAL DISTRIBUTION 15
associates always know exactly what is expected of them.
Limit extraneous tasks that detract your sales team from
their goal; fewer reports and teleconferences means more
time for customer interaction and proactive sales efforts.
Strong leaders use metrics to define what behaviors are
required and religiously stay in constant communication
with their team.
Coach Them Up
Take every advantage — scheduled or unscheduled —
to provide one-on-one coaching feedback and inspiration
to all members of your team. When you make coaching
a high priority it builds team confidence and shows that
you care. Inspired coaching results in higher-functioning,
more-consistent performers. And when you use metrics to
support your coaching methods, you merge the insights
data provide with the importance of proper behavioral
performance. It’s a powerful combination.
Data shows that companies spend too much time coaching the top 20 percent of the team and trying to improve
the bottom 20 percent. Your time is better spent with the
middle 60 percent. Invest your finite coaching time with
them, leave your top 20 percent alone and work to get rid
of the under-performing bottom 20 percent ASAP.
Traditional sales managers default to “spreadsheet
coaching” where it’s all about the numbers. When you
just focus on the numbers and the quota, you miss the
necessary human behaviors that are required to consistently realize the positive outcomes you demand. Lifting
weights isn’t about the number of reps, it’s about building
strength, flexibility and/or endurance. When you coach by
focusing on one key goal, the “reps” will just take care of
Here’s four of my favorite sales metrics I believe get to
the heart of any business:
1. The Close Ratio: Close ratio is the number of deals an
associate closes compared to the number of contacts they
make. If a rep makes 100 calls a year and closes 18 deals,
their close ratio is 18 percent. Incremental increases in close
ratio typically translate into dramatic increases in revenue
and margin. Knowing your team’s close ratio provides
statistical line-of-sight to how frequently your team is win-
ning in their efforts and allows you to refocus efforts on
behaviors that will work to improve your team’s ratio.
2. Sales Cycle: Sales cycle is another often-overlooked
metric. Knowing how much time elapses from prospect to
paying customer provides valuable insight into the vitality
of your sales efforts. The faster you can convert people,
the more people you’ll convert. When you know your sales
cycle, it makes it easier to predict when sales won’t happen. If a prospect is in the pipeline for 13 weeks and your
sales cycle is usually 10 weeks, you’re probably not going
to win that business.
3. New Vs. Returning Customer Sales: Healthy businesses strike a good balance of new and repeat customers.
Getting customers to buy from you again (thus increasing
their lifetime value) certainly improves sales and profits.
And with the costs of acquiring new customers continuing
to escalate, understanding your mix of new and repeat
customers can be an important data-point to use to help
develop your strategy.
4. Revenue Per Sale: One of the easiest strategies to
grow both topline and margin is revenue per sale. It’s the
proverbial suggestive sell: “You want fries with that?”
Adding additional items to a customer’s existing order
increases sales and profits while adding negligible,
incremental cost. Focus on your revenue per sale and your
volume and margin dollars should improve accordingly.
Find Your Focus
With few exceptions, most traditional sales metrics
are trailing indicators — they look back and state what
happened. When you develop and focus on metrics that
measure what is actively happening versus what happened,
you stand a much better chance of rapidly (and profitably)
growing your business.
So what’s the most important metric to your sales
channel-to-market right now? The answer: the one that’s
broken. It’s up to you to identify which specific metric in
your unique business is paramount to help get you to your
sales inflection point. Work diligently to identify it. Then
focus relentlessly on that one crucial item, coach up your
team, and unleash your success.
When it comes to leading your sales team, don’t simply
manage to metrics. Rather, leverage the power of metrics
to better manage your team’s behavior. Properly configured, metrics will reliably ensure that you’re aligned,
consistent, predictable and profitable.
Jeff Guritza has used metrics to successfully leverage
accounts to an eight percent YOY
jump in gross margin. He also used
metrics to identify “sweet spots” in
pricing that dramatically improved
quote close rates. He saved millions
of dollars in manufacturing using
metrics to analyze and strategically
rationalize primary product lines.