Are You Ready for Activity Based Selling?
The old school way of managing sales teams is dying, and for a good reason.
Sales leaders are finding that the most efficient way to manage a sales team is not just with lagging metrics such as close rates, deal size or quota attainment. Those are, of course, still critical to measure. But they only tell you what’s already happened, and not what you should be doing right now to impact those numbers in the future. What if your gas gauge didn’t indicate you were on empty until you ran out of gas? It’s much more helpful for your vehicle dashboard to alert you ahead of time when you need to make a pit stop.
Modern sales leaders are demanding a real-time pulse on what’s happening within the sales organization that will lead to closing more business so they can course correct ahead of time to keep sales on track. Don’t be the sales leader who waits until the tank is on empty before you start trying to jumpstart your pipeline – start utilizing the activity based selling methodology.
What is Activity Based Selling?
Activity Based Selling is the idea that winning a sale is the outcome of a cascading chain of controllable activities. Salespeople aren’t always sure where to spend their time, and often get lost in day-to-day “busyness” instead of the activities that are truly meaningful to the sales process.
Activity Based Selling guides reps on how much time they should be devoting to the key activities that lead to winning more business. When a sales organization is fully aligned and engaged around a common set of sales operating metrics, the teams achieve high revenue per seller, robust data to develop sales forecasts based on current activity levels, insight into the sales capacity of reps, and an outcome-focused team of data-driven sales experts. Not to mention a team of front line sales managers who can coach and develop their people objectively versus just asking what’s closing this month.
4 Critical Questions for your Activity Based Sales Team
Do you think you’re ready to run an activity based sales team? Ask yourself these important questions first.
1. Have you defined your key sales metrics?
Start by defining the structure of your sales organization. Do you oversee 10 sales managers who each have 15 reps working under them? How are they segmented? Depending on the structure and make up of your team, each selling team will likely have a unique set of metrics. For example, a field sales team will have different set of metrics than an inside sales team.
You’ll want to start with your own hypothesis for the the key sales metrics you want to track. What do you think are the most important activities for your sales team? Start by doing research on the most popular sales KPIs, but keep in mind that what works for one sales team may not work for another.
Finally, ask your salespeople and frontline managers what they think are the key selling activities that lead to winning a sale. Interview a few sales reps and sales leaders to get their point of view. Including your team in the process not only creates early buy-in, but will also likely open your eyes to things you might not have realized before.
2. Is your organization aligned?
If your sales organization isn’t on the same page about the most important activities that lead to sales, then people won’t pay attention to them.
After developing your initial hypothesis and completing the interviews, use your own judgment to look at the data and identify the top 3 to 4 most important activities. As the sales leader, the final metrics are ultimately your decision.
Before you roll things out to the full team, give your sales reps a soft introduction and collect feedback. This further helps establish buy-in and be prepared for any potential objections. It also communicates to the team that you’ve really done your homework and the recommendations are based on what’s been learned from the team.
After rolling out the key metrics, ensure it’s all being tracked properly in your CRM system so you can deliver individual rep and team performance scorecards. This helps people remain focused and accountable, and becomes a vehicle in which to encourage best practice sharing.
3. Do you have a plan to monitor and course correct?
You need to have a plan to monitor your metrics so that you can course-correct when activity levels fall behind. How do you keep track of your metrics? Are you using a sales activity management system?
In addition, you should have weekly one-on-one meetings between managers and reps to review activity levels and inspire team collaboration with stack rankings. When a team is collectively behind on one of the key metrics, this becomes an excellent time to use incentives and contests to rally and energize the team. With this consistent daily focus, your use of incentives becomes much more strategic versus just what feels right at the moment.
4. What’s your plan to grow from a strong foundation?
After you’ve engaged in activity-based selling for a couple quarters, look for best practices by analyzing the key activities of your top performers. Also, assess your data on a regular basis to ensure that the activities you’ve identified actually drive more sales.
All of these questions are imperative to understand if you’re ready to run an activity-based sales team. If you want to learn what other sales teams are using as their primary sales activities, check out the inaugural Sales KPI Report. But remember, what other people are doing may not be exactly what’s right for your team. Make sure you go through each of the above steps carefully to ensure you can build your own modern, activity driven sales organization.
Being a data-driven sales manager means, at a high level, understanding how metrics impact one another, how to approach setting goals against key performance indicators (KPIs), and how to coach to the achievement of those goals. But, how can a manager incorporate data into her ongoing managerial cadences? 1:1 meetings.