The traditional sales manager role is responsible for mentoring and coaching their team members through exercises such as; role-playing, critiquing sales calls, and individual meetings focused on improving instinct and interpersonal skills.
Today’s sales managers combine the traditional approach of sales management with a data driven approach. Data helps provide greater transparency between Sales Managers and Sales reps for several reasons:
- Data is objective so sales reps can’t argue with it or hide from it.
- Analyzing data allows managers to provide individual feedback as opposed to a lump sum of broad feedback.
- Analytics allow reps to focus their time on what’s working well and provide managers insight into areas of improvement.
Below is the first of three data driven exercises that can help improve the efforts and productivity of your sales team.
How Many Activities Does It Take For A Sales Development Representative (SDR) To Convert A Lead Into A Sales Opportunity?
Managing a Sales Development team whose primary goal is to book meetings, demos and drive opportunities for your Account Executives (AE) can prove challenging. Often times, sales teams are typically filled with young entry level reps who are provided with a Salesforce login, a phone and a pad of paper. These new sales reps are instructed to hit a quota of activities, whether it be a certain amount of phone calls or emails…they are closely monitored to ensure they hit their quota.
When I managed the inside sales team at CAKE, I used a data driven approach to inform the SDR’s of their daily quota, goals and expectations. Let’s look at a practical example of what this might look like on a daily basis. In this example, I will keep it simple. Let’s assume each SDR is required to complete 100 activities (phone calls, emails, etc) a day and generate 10 opportunities (conversions) for their AE’s per month.
The first step in determining the appropriate quota per sales rep is to look at data to analyze their past performance. A good rule of thumb is looking at a minimum of three months of data. I look at how many activities they average per day during this three month span and compare it to how many conversions they average per month.
Let’s look at a real example:
Let’s say Matthew is under performing in his role as Sales Development Representative. He has not been hitting his quota of 10 conversions per month, averaging only eight per month. He is however hitting his daily activity quota of 100 per day. As Sales Manager, your meeting with Matthew will most likely go something like this:
SDR: “I am doing the necessary daily activities but I am having bad luck with the leads I was given. They are not qualified leads.”
In addition to coaching your SDR with traditional methods to improve his sales skills, you can use this formula to show how much daily activity he needs to hit his quota. If you want your SDR to hit 10 conversions, the formula would look like this:
100/8 = X/10
(X being the number of activities needed to hit quota):
Multiply X by 100 and you have the number of activities Matthew needs in order to hit his quota per month.
Matthew will need to do 125 activities per day to hit his monthly quota. As a manager, of course you will need to work on his prospecting tactics, phone messages, and email cadence but you can also show him that by doing an extra 25 activities per day in addition to his 100, he will be on pace to hit his monthly quota. Exerting more energy and work, proven through the data, will help Matthew get out of his so called “rut”. This formula also applies to figuring out how many activities it takes to book a meeting/demo, or how many meetings/demos it takes to create or win an opportunity.
Focusing on what they can control (activities) as opposed to results (conversions) can help give SDR’s a better grasp on how their day-to-day efforts should go. In my next post, I will go over a data driven exercise that will help your reps manage their pipeline to hit quota. Stay tuned for parts 2 and 3!