Working Backwards From Your Goal To Get Ahead


by Tibor Shanto - Date: 2006-12-31 - Word Count: 991 Share This!

It is always interesting when you sit with a group of sales people and the subject turns to sports. No matter what the sport, there is the inevitable talk of the leaders and their potential accomplishments over the course of the season. When it comes to individual athletes, the talk turns to their numbers, total goals, batting average, number of at bats, plus/minus averages, number of times striking out with men at second, short handed or power play goals, home average vs. road average, and so on. The athlete's numbers are dissected and analyzed from all angles, usually in connection with a pool or a wager.

Yet often when you ask the same sales professional what their numbers are, they usually tell you their goal, where they are vis-ŕ-vis their goal, perhaps how many sales they have that month, how many accounts they currently have, but usually not much more.

But like athletes, sales professionals need to track much more if they want to consistently outperform. How many at bats? Or better yet how many appointments did you have this year, and how is that versus last year? Is that number of appointments adequate to get you to your goal? To properly answer that, it is necessary to break down your goals to understand the level of activity needed to achieve it. Somewhat like working on your batting average and number of hits. To accomplish this you need to track a number of things, and then work backwards from your goal.

Three things are a must:

- The average length of your sales cycle
- The average size a sale
- The number of meetings (appointments if you will) during that sales cycle to close the sale.

Very few people can tell you what their average sales cycle is for a given product (understanding that some folks sell a variety of products, and each may have a different cycle), key here being average. When we ask about the length of the sales cycle for a product we often get a wide range of answers. Recently we had a manager tell us that the normal cycle was between 10 to 12 weeks. When we put the question to his team of 8 reps, the shortest was 6 to 9 months; the longest was a year to 15 months, quite a range.

Now it goes without saying that if you looked at the last 100 sales for a given product, a pattern will emerge. After you take skills and other factors into account, you will see a discernable curve. Leave out the anomalies and you'll find that some 80% will fall in to a tight range. That is your sales cycle. Doing this takes effort and cooperation between rep and company, but it is a worthwhile exercise that helps everyone set benchmarks; and hey, leverage the investment in that CRM. This same process will give you the average size of each sale.

This done you can then focus on the average number of meetings to close a deal. This is much more an individual exercise, but there is benefit in knowing the organization's average. But unless you know how many meetings you will need to close a deal, how will you manage your diary. With tools available today this is an easy thing to discover and track going forward. Now you can easily know how many sales you'll need to make your year, or better yet, how many you'll need to beat your goal, how many meetings you'll need to schedule and properly manage your time.

This can also be the base for further improving you're activities to deliver success. For one, you need to know how many "new prospects" you need to engage to reach your goal. Allowing for the fact that a certain part of you goal will come from existing clients, it is also important to know how many new prospects you need to identify, find, engage and close to make your number.

For example, if the first exercise showed that your cycle is a month, you need 60 sales a year (or 5 per month), and it takes on average 4 meetings to close a deal. You know that you will have a minimum 20 meetings per month. This assumes that you will close every new prospect you meet, but if you close (in the current cycle) only one out of every three new prospects you meet, then you can add ten more meetings. Now if half those go to a second meeting before you loose them as prospect, add another 5 meetings. That is 35 meetings for the month. If you loose two more after 3 meetings, you're at 38 meetings a month or about 9 per week. And we haven't even begun to allow for account management, admin, and most but not last: prospecting.

By the way, the above works just as true (and well) if your average sale is $600,000, over a 12 month cycle involving 10 meetings.

What does it take to set 15 initial appointments it takes to secure five deals a month? How many people will you need to speak to, how many will you need to reach out to, how much time will this take everyday?

You have to take the time at the start of the year to work backwards from your goals, using your specific stats (at bats, batting average, times called out on second after a walk to first…). You need to repeat this at least quarterly based on success YTD, or even monthly depending on product, market and cycle. In a slow year you need to increase activity and productivity according to results, and in good years you set to out perform or moderate pace and perhaps work on existing clients and penetration.

Now athletes and coaches go through this almost daily, not only looking at game stats, but reviewing tapes, and then adjusting accordingly. Sales professionals have to as well. Without working backwards from your goal, you have little chance to get ahead.


Related Tags: goals, sales process, objectives, sales planning, sales strategy, metrics, territory management

Tibor Shanto, is a Principal with Renbor Sales Solutions Inc., Renbor Sales Solutions Inc. enables companies achieve sustained growth, by focusing on critical aspects of revenue growth. By recognizing that an outstanding sales force is THE differentiator in today's environment, our clients with our help, focus on the development of both strategic and tactical initiatives to foster a winning team that will out think, out sell and out perform competitors while consistently gaining market share.

Renbor's Objective Based Selling (OBS) is a structured approach to delivering ongoing results and improvement by focusing the entire sales organization on a key set of objectives. The overarching objective for any sales organization is to achieve exceptional and sustainable revenue growth. This is accomplished by creating a culture of sales excellence built around the principles and processes adopted by world-class sales organizations.

For more information on helping your team sell better, write to: info@sellbetter.ca, visit http://www.sellbetter.ca or call 416 671-3555

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