How to Fix Your Six Figure Problem, Your Sales Metrics
Think about how much time and energy you invest in reviewing sales metrics, sales pipeline reports, analyzing and updating your job board (assuming you have one in your office) and looking over sales forecasts in your CRM or ATS. Now also think about how much time and effort you put into preparing for and participating in sales meetings, and one-on-one meetings with your sales reps where you're trying to help them get those "late stage deals" back on track and closed. If you’re like most sales leaders than the answer is a LOT!
For most sales leaders and IT staffing owners, the sales pipeline is the key driver for how the business is managed. The sales pipeline including the sales forecast guides many of the tactical and strategic business decisions from when, why and how to hire new sales reps and recruiters to making technology investments and expanding the footprint of the business. Your sales pipeline is your lifeblood!
Sales pipeline management is a key component to the business, and how it is managed is critical to the success of any sales team. Ironically enough however, sales pipeline management-the thing we focus most of our time and attention on-is where the most common and fundamental mistakes occur. If your IT staffing firm is anything like the hundreds that I have worked with over the years than I can almost guarantee you that your sales metrics are you costing you hundreds of thousands of dollars.
Here is the problem-and where your firm is likely losing out on huge $$$-most sales managers. IT staffing firms including sales managers spend too much time and energy trying to manage their "closest to the money opportunities" when instead they should be focused on improving the quality of job orders that they put into the sales funnel.
In other words, most job orders sales reps are pursuing are never qualified from the get go and therefore are highly unlikely to close and should have never been added to the sales pipeline in the first place let alone included in your sales forecast.
Just look at you sales win rate (total number of job orders that were entered into your CRM or ATS divided the total number of jobs that were actually filled) and that will tell you all you need to know and reinforce my point.
Staffing firms are wasting hundreds of thousands of dollars creating and then chasing unqualified sales leads and subsequently unqualified job orders that will never close. That’s the real problem. Heck, why do you think your CRM/ATS has thousands of contacts in there who have never done business with your firm? And who do you think is paying for all of this? Your company, that’s who.
What are the REAL Key Performance Indicators that Drive Success in My Staffing Firm?
I suspect you know the answer to that question and I also suspect your answer is very similar if not the same as the following. From each of your sales reps you expect them to attend ten (give or take) weekly face-to -face sales meetings and you’re also expecting them to get five (give or take) new job orders per week, out of which you probably expect them to close two deals per month. Sound about right?
The reasons your sales metrics are at least a six figure problem is because your sales metrics have established your sales strategy as this:
- Get more job orders. To get more job orders you just have to
- Schedule more sales meetings. To get more sales meetings you just need to
- Make more sales calls
So simple right? This is a sales strategy that is based purely and exclusively on activity. In other words, the only way to make more placements and to make more money is to increase activity. Unfortunately this sales strategy has a number of flaws one of which is its not scalable, but let's play this out.
You show your sales reps your strategy and all of a sudden they get pumped-up and suddenly they start working harder to make more calls to get more meetings so they can get more job orders. But then what happens? Drum roll……..the desired sales results don’t come in.
Your sales reps start thinking to themselves, "all this hard work pounding the phone and zipping all over town meeting with these prospects for what?" Frustration sets in and morale and confidence on the sales floor plummets. How does the sales manager respond to all of this? Simple. The sales manager says "Dan, you just need to make more calls to get more meetings so you can get more job orders, so hop to it!" How does Dan the sales rep react to this classic sales coaching blunder? Dan is fuming in frustration and needs to take a walk around the block.
Sound familiar? Fortunately I have a solution.
Why Qualified Leads (Converting Leads to Contacts) is the Lifeblood of the Menemsha Sales Methodology
Until you address your fundamental problem, the fact that your sales people are meeting with and nurturing sales leads that are of poor quality with little to no chance of closing, you will not improve your sales results. As a friend once told me “you can’t polish a turd.” You can’t keep stuffing unqualified leads into your sales funnel and expect shiny qualified job orders to come out the bottom of your sales funnel ready to close. This behavior is what is costing staffing firms so much money and frustrates the heck out of recruiters and drives employee turnover.
So what is the answer? You have STOP managing "closest to the money job orders" and START training your sales reps how to generate QUALIFIED LEADS. THIS IS THE ONLY ANSWER.
Just look at the top performers in your company. From my experience top performers actually don’t go on the most meetings or have the highest activity levels. Why? Because they spend most of their time disqualifying leads who are a poor fit. Top performers don’t see the value in going out on 15 sales calls each week because they simply don’t want to waste their time. Instead they would rather spend their time qualifying leads and making sure their prospecting and lead nurturing efforts are focused on the right leads. Unfortunately your top performers only make up the top 20% of your reps which means 80% of your sales team doesn’t understand this. They need to be trained!
The Only Real Solution is Sales Training
The challenge with sales training however is that IT staffing firms are not very good at it (building and deploying sales training programs). It’s not to say they can’t build a strong sales training program but very, very few have. To prove my point and test how effective your sales training program is try the following. Call one of your sales reps (disguise your voice or have a friend make the call) and pretend you're a prospect inquiring about contract/staffing services. Start asking your sales rep questions about his or her services. Have fun with it, make it sound like you really need some help. Then, see if they try to qualify you or if they just push to meet with you and/or take an unqualified order. For kicks you can throw a few objections at them and see how they handle it. Try this exercise with an experienced rep and a brand new sales rep. Hopefully I’m wrong but I suspect you will not be thrilled with the results.
Again, the fundamental problem is sales training or lack thereof. Until you solve this fundamental problem by training your sales team on how to generate and qualify sales leads, continuing to allow them to nurture unqualified sales leads and stuff more unqualified leads into your CRM or ATS sales pipeline will not get you the results you and your company need.
If you want to break this viscous cycle and actually start improving your sales effectiveness including your sales win rate then here is what I suggest you do:
- Get back to basic sales fundamentals by defining exactly what constitutes a qualified sales lead
- Identify all of the qualification criteria that constitute a qualified lead for your organization. Be sure to also think about the negative attributes of a lead and be sure to leave those out of your definition. Knowing the characteristics of the leads you want to avoid is just as important as understanding the characteristics you seek in a sales lead. I also suggest you consider including your recruiters in this exercise. Your need their objectiveness.
- Start holding your sales reps accountable-yes hold them accountable-to only putting leads in your CRM/ATS that meet your sales lead qualification criteria
- Start holding your sales reps accountable to only meeting with and nurturing qualified leads
- Sales managers start inspecting every qualified lead on a daily basis to ensure your sales reps follow the process. Stop letting your sales reps put junk in your CRM/ATS
The bottom line is real simple. Sales reps and in many cases sales managers have to be trained on how to find and qualify real buyers. The name of a person from Discoverorg or Linkedin or any other data source with “Manager” or “Director” in their job title does NOT make them qualified. Contacts who are willing to take a meeting with your sales rep doesn't make them qualified. Stop playing games and stop wasting your time. If you start de-emphasizing the management of your “job board” or sales pipeline and refocus that energy on training and developing your sales team on how to generate qualified leads I assure you that you and your sales reps will be happy with the results.
What are your priorities as a sales manager? What steps are you taking to improve the effectiveness of your sales reps? Let's start a conversation in the comments section below.