In a classic episode of The Simpsons, Mr. Burns recruits a collection of star major-leaguers to play on his power plant’s slow-pitch softball team. During a game, he offers this piece of coaching advice to one of his ringers at the plate: “You, [Darryl] Strawberry, hit a home run!”
The outfielder replies, “Okay, skip!” and belts the next pitch over the wall, onto a nearby interstate. Burns turns to his cohort Mr. Smithers, standing next to him, and says with a smug chuckle, “I told him to do that!”
Of course, in real life it’s not quite so easy. Instructing players to hit home runs isn’t productive. But coaches can increase their players’ chances of going deep by helping them strengthen techniques at the plate — improving pitch recognition, swing mechanics, and so forth.
Similarly, sales managers won’t propel their reps to success by just telling them to go close a deal. What we can do is ingrain pipeline management practices that are conducive to successful outcomes. To determine what those are, we need to rally around a set of sales pipeline metrics that help us see which activities are making a positive impact.
Selecting and Leveraging Sales Pipeline Metrics
On the Story Block Media blog, David Katz recently shared a list of sales pipeline metrics worth tracking:
- Number of Deals in Pipeline
- Average Deal Size
- Win Rate
- Total Pipeline Value
- Average Length of Sales Cycle
- Sales Cycle
- Probability to Close
- Lead Response Time
- Sales Pipeline Velocity
With this breadth of measurement, we start to see a much fuller picture. Tracking only which opportunities turn into deals isn’t all that telling, but understanding which ones are turning into larger deals, faster, at higher rates, can inform our strategies in numerous ways, from prospecting to budget-setting.
A recent post at InsightSquared from Lauren Kelley posits that Average Sales Cycle is particularly critical for SaaS companies, and that’s likely true regardless of your industry.
“Faster growth companies have shorter sales cycles and slower growth companies have longer sales cycles when comparing similar companies,” she notes. Aiming for shorter sales cycles is a more credible goal than simply aiming for more sales, and it’s inherently oriented toward the same outcome.
But properly leveraging these insights requires good data. Studies suggest this is a prevalent hold-up.
Straightening Out Sales Pipeline Data
New research from Vendor Neutral and the American Association of Inside Sales Professionals (AA-ISP) highlights the top barriers hindering peak sales performance. The third-most prominent factor, “Poor data quality or not enough data being logged,” is in many cases directly tied to the top two: “CRM not being used to its fullest potential,” and “Too many different platforms in use.”
When technology and tools are impeding the sales team’s ability to access actionable data and get the most out of it, they might be doing more harm than good. Measuring sales pipeline metrics requires a clear view of opportunities, timelines, and evolving deals. In many cases, simplification should be the first priority.
Sales Navigator syncs up with many popular CRM systems and can bring clarity for sales managers and reps. These two connected tools alone might negate the need for several others. By logging seller activity more comprehensively through this setup, you can make well-informed decisions about what’s working and what’s not.
A Measured Approach
Sophisticated sales teams are expanding the scope of their measurement systems, hoping to better understand the processes that lead to desired outcomes. For example, David Bloom writes at Sales Hacker that measuring sales enablement is a valuable practice, and suggests metrics for doing so. One key benefit to nailing this down, per Tamara Schenck at CSO Insights, is strengthened cross-functional collaboration. Here at LinkedIn, we also wrote recently about the vital importance of teamwork (internal and external) for sales productivity.
The bottom line is that properly leveraged data can guide almost every element of your sales process toward optimization, especially when it comes to collaboration. If you’re plagued by inhibitors mentioned in the aforementioned study, it’s always worth thinking about how you might streamline technology and workflows to better illuminate those critical sales pipeline metrics, as well as others that ladder up to them.
As a sales manager, you can’t simply tell your reps to go out and close deals, just like a baseball manager can’t tell his players to go hit grand slams. But with the right repeatable techniques in place, your lineup will be positioned for plenty of base runners and big hits.
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Topics: Sales trends
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