Using Behavior Analysis to Impact Sales Revenues

How can sales trainers and managers use BA to boost sales?

Observing and assessing what people to say and do in given sales situations is not new. It can have a powerful impact on sales effectiveness when done well. From sales ranging from inside to field sales, from direct to indirect, from simple to complex it is not so much which is the best system but which is most appropriate for the job you need to do. What follows is an overview of the case for BA in improving sales performance.

Why measure what people say or do?

Many of us are unaware of how skilled we are and, more importantly for development purposes, we are very often unaware of exactly how we produced such skilled purposes. We could, of course, ask skilled performers how they have reached their level of ability. Unfortunately, many of their highly skilled performances are by now unconscious with apparently little effort or planning. In fact various research studies of expert performance skills – music, sport, selling has shown such analysis can be really misleading. The prize though is worth it. If we can analyse top performers and are able to develop those skills in others the pay-offs are often double digit sales revenue increases. For example, in my own sales productivity projects, with a range of clients, have produced sales increase ranging from 25% to 100% using a BA based approach.

Clearly, if we want to illuminate why some people are more skilled than others we need to measure what is going on. A crucial factor is to make sure there is a balance between sales outcomes (Lagging Indicators) and the sales behaviors/process used to achieve such results (Leading Indicators). This balance shifts as the complexity and length of the sales increases. It becomes crucial to know how more skilled sales people achieve sales progress, such as:

• Get invited to bid
• Gain customer’s agreement to visit a reference site
• Help the customer develop their RFP

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How do you ensure New Hires can develop Sales Mastery?

Being competitive comes from people who are well aligned with their organization’s intent and mission. If you take that extra care to recruit and select such people, my question is:

How easy is it to waste the opportunity you have created?

Certainly, having faith that “they will get it” is not a strategy. Without real investment of your time, onboarding will be hit and miss. So, let’s look at that investment and how best spend time with New Hires.

So, You give them $1000 per head for sales training and a month later the give you $130 back – What!?

Crazy as this seems, surveys and research show this is a common outcome.

There’s got to be a better way to ensure sales executives get a return from their sale training projects. We need to raise the bar in how we select Sales Training providers?

A poor investment?

What follows is my personal quest for improving the outcomes of such projects

Three reasons kept surfacing in conversations with sales managers:

1.      How Much People Forget.

No matter how well we train sales people and they say they get it, typically most value gained erodes inside 30 days (80%+ is typical)

2.      How hard people find it to change their natural behavior

They get frustrated easily, after seeing the value of change and experiencing progress during a training program, they slip back to their default behavior – their comfort zone.

3.      Even when trained well, coaching is too little and too-outcome focused. And again people revert to their default behavior pattern.

Our experience is not unusual.  All those trying to gain competitive advantage for their companies recognize these problems.

So, we discussed

Why aren’t things improving?

Key Account Management Series: Why are Sales Compensation Hydraulics Still Leaking?

1.    Introduction

I developed this as a discussion paper for a client’s European Sales Management Effectiveness Project. The interesting perspective is how the issues raised in the early 90’s are still validated by Deliotte’s 2010 survey of 250 Sales VPs. It begs the question:

Why are Sales Compensation Hydraulics Still Leaking?

1.1.  How do you design a good sales compensation plan?

Specifically, a good plan:

• Uses performance metrics that drive the company’s overall strategy;
• Ensures roles, skills, selling, processes, internal culture, etc. are consistent with the overall sales force strategy
• Are mechanically sound ; and
• Can be administered efficiently.
• Fits for your sales organization?
• Can be administered with existing people, processes, data, and technology

(The following is based on Frank Cespedes book Concurrent Marketing, The Management of Major Sales (Neil Rackham) and 2010 Strategic Sales Compensation Survey by Deloitte & Varicent)

1.2.       Compensation Hydraulics springs a leak

Since the mid 90’s the great bulk of literature still emphasizes what might be called

“Compensation Hydraulics”: Push this pay lever and get this kind of behavior.

This type of thinking fails to recognize that sales compensation is dependent upon, data analysis, strategy, values and human motivation. Many forget to ask:

How should we pay our customer facing people? (Which inevitably involves a range of business issues?)

Developing Sales Coaching Expertise: Learning from the Masters

(Journal article by George M. De Marco, Byan A. Mccullick; JOPERD–The Journal of Physical Education, Recreation & Dance, Vol. 68, 1997)

I like this article as it challenges some of the more superficial approaches to training sales managers to coach. It is a challenge that so many duck and as I wrote in Quality Sales Managers Matters:

#1 High-performing sales manager’s impact reps engagement and financial performance. Reps reporting to great managers report high job satisfaction with four times more revenue than those working for poor managers.

#2 Coaching Is King—The manager activity most linked with sales rep success is coaching. However, their coaching ability to coach individual sales reps is the weakest.

#3 Who they coach is selective— Coaching low or star performers does not statistically improve performance. Core performers, the 60% center of the performance Bell Curve make significant improvements with coaching.

#4 Effective coaching hits the bottom line. Core sales reps receiving great coaching reach on average 102% of goal in contrast to sales people reporting poor coaching who achieve only 83% of goal. Good coaching can improve core performance by 19%. This is lower than with PDS’s and Huthwaite’s sales productivity projects (18%-30% sales increases)

#5 Great Coaching Is a Learned Skill—Quantitative analysis shows that five elements account for 77% of coaching effectiveness. Armed with this information, we can develop great coaches by focusing them on specific activities such as emphasizing the importance of targeting the best opportunities and spending at least three, but no more than five, hours coaching each rep per month.

The characteristics of coaching expertise, research into  coaching effectiveness, coaching expertise, and expert performance in other  domains, a profile of expert coaching has emerged. – Five distinct  Characteristics

Characteristics of Expert Coaches

1. Extensive, Specialized Knowledge

All around understanding of the internal and external sales  environments

2. Organize Knowledge Hierarchically

The ability to store and organize information as learning  patterns which allows them to compare idealized performance standards with the  present performance of their people.

At its core the experts are superior planners and  evaluators. E.g. expert gymnastic coaches used a model to determine and plan  for their athletes potential developing short- and long-term goals being set  and periodically reset according to the athlete’s progress.

Another study compared 10 expert and 10 novice basketball  coaches. The results indicated:

“..experts had more in-depth and detailed planning  protocols, with more augmentation, sub goals and anticipated problem statements  than novices. They planned practice sessions in bigger chunks, taking into  consideration more components of the problem at one time” (p.215).

3. Highly Perceptive & Superior Problem Solvers

Experts are uniquely capable of accurately perceiving  stimuli in game situations. They can sort important clues from other “white  noise” and then generate superior responses. They can see how all the pieces  fit together to help their athletes to plan, diagnose and strategize more  effectively. The experts solve problems more methodically

4 Accurately assess and prescribe performance

This positively impacts the quality and quality of coaching  during practice. Basketball experts spent 42% of their time in instruction In another study, expert coaches gave significantly more  feedback.

Expert coaches are able to detect what people need to know  and then find ways of supplying that information.

5. Exhibit Automaticity During Analysis & Instruction

Several studies on coaching effectiveness showed that  coaches of less satisfied high school teams often interrupted the flow of  practices to instruct, whereas coaches of satisfied teams typically provided  instruction as they played.

Commentary of Summitt’s coaching:

“provides succinct and rapid-fire instructive  and prescriptive feedback during play”

6 Self-Monitoring Skills

Experts are more self-aware, analytical, evaluative and  corrective of their performances. They are driven by the desire to improve  their own coaching performance

Developing Expertise in Coaching

1. Gain  More Knowledge
2. Study  successful coaches
3. Identify  the important. Organizational skills are critical to effective coaching.  Keep yearly, monthly, personal records
4. Stay perceptive, recognize problems early and solve them quickly.
5. Concentration is a must – focus on the task at hand and don’t let yourself  be interrupted or distracted. When analyzing a skill performance, focus  only on one aspect of the performance, not the whole skill.
   ”The sooner the coach can analyze skill problems, the sooner the will  move to the expert level”
6. Identify  & solve problems in a rapid, complete and correct manner demands skill  that continually needs to be developed
7. Increase  short- and long- term Memory – A great distinction between the experts and  others
   “the ability to acquire, retain and apply knowledge”
8. Make  it Automatic – develop practice routines, warm-up drills, pre-game activities
9. Regularly  monitor and evaluate your own coaching

An Approach to Solving People Problems

INTRODUCTION

People problems are very varied; they can also be complex.  There is no all-embracing theory for
understanding them and no magical formulas guaranteed to solve them.  The problem-solver, where people problems are  concerned, must be an experimenter.  There are, however, a few guidelines which, if observed, will help to  save the problem-solver from wasting time and effort on ultimately unprofitable activities.

Leading in Complexity – Discussion Starter

Introduction

This discussion starter gets leaders thinking about leadership and help them  move toward consensus before starting a major change initiative. (For more in-depth discussion please go to the Leading in Complexity Blog Series).

A critical issue is helping the team to “walk through” the range of relations they will meet managing change, dealing with the practicalities and intricacies
of people, departments, factions and geographies.

A large part of the task is not just ensuring leaders understand their change environment but  that the organization can continue to learn and act on over time.

Complexity, the New Normal! 1: Aligning Leaders for a Complex World

Every one faces complexity driven by uncertainty and accelerating change. It is the “New Normal” making leadership more demanding and in demand.

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Leadership on its Head

Accelerating Complexity places extreme demands on leaders. The leader’s ability to relate, energize, and develop their followers is critical to empower them to act without direction. It’s a competitive imperative and requires a new balance of more effective and affective leadership. It’s the ability to produce results by being affective. That ability to influence people, in the way they think, feel and act is now paramount

As Peter Senge said Leaders “…cannot afford to choose between reason and intuition, or head and heart, any more than they would choose to walk on one leg…”

So, this month I deal with what leaders need to do – the easier bit. Next month, I cover the tougher piece on how leaders need to lead transformationally.