How To Find Your 'Moneyball' Sales KPIs

April 14, 2016 Brian Trautschold

How do you measure the true value of an employee? The true efficiency of a sales process? Whether your employees are actually following correct processes to complete objectives? They’re all things you need to know, but they’re hard to measure.

Our brand-new eBook, The 2016 Sales Performance Index, sets out to answer key questions that sales leaders face in evaluating performance. In this excerpt, we show you a great place to start: Moneyball performance metrics.

Measuring employee performance is becoming a hot-button issue, with overburdened sales leaders struggling to juggle increased responsibilities and personal performance objectives.

How can sales leaders do more (to hit team objectives) with less (time for coaching and managerial oversight)?

Embrace the analytics revolution, follow in the footsteps of Billy Beane and discover your sales team’s Moneyball performance metrics.

The 6 Steps To Moneyball Performance Metrics

A critical first-step to smarter employee performance is reimagining your sales data.

Your standard sales KPIs - calls, meetings set, deals closed - are the hits, batting percentage and RBIs posted by each rep. Your efficiency and effectiveness metrics - lead conversion rate, connect conversion rate - are their slugging percentage, on base percentage and so forth.

And just as in baseball, Moneyball performance metrics add critical value for sales coaches and GMs looking to assess, align and optimize their teams as efficiently as possible.

Your goal:

Find the metrics that act as direct corollaries between your sales team’s actions and outcomes.

How do you find important correlations between process and performance? Follow this six-step action plan.

Step 1. Create 2 sets of targets: Activity & Objective

Start with this basic example: SalesCo makes calls. And on those calls, they close deals. So calls lead to closes.

Boom: There are your two most basic kinds of performance metrics, working hand-in-hand. Activity metric (calls) and Objective metric (closed deals).

dials closes

Let’s dive deeper into what constitutes an Activity metric versus an Objective metric.

Activity Metrics:

The most common activities in your sales process, such as cold calls, emails, or LinkedIn messages. A good way to think of Activity Metrics is as your most important verbs.

Objective Metrics:

The key outcomes for your sales team, such as won deals or revenue. A good way to think of Objective metrics is as your most important nouns. Identify your top 3-4 metrics in each category. Create 2 data sets. Then, you're ready to begin creating Moneyball metrics.

Step 2. Select an Objective Metric

Next: Select an Objective metric such as monthly revenue, weekly profit - whatever is a pertinent major objective for your sales reps.

Susan Brown dashboard

Step 3. identify a top and bottom performer on that objective

Two keys here:

1. You should select a recent time frame, such as last month, last quarter or last year, to base your evaluation.

2. Both performers should have the same role and seniority. Once you pick your Objective metric (Ex. Total Q1 Revenue), find 2 people who have the same role and experience, but performed on opposite ends of the spectrum.

Karla Fletcher

Alex Weber

Step 4. Calculate Activity Metrics for appropriate time frame

For each employee, calculate their monthly totals across the Activity Metrics that make up their pipeline metrics.

metric tools aug 2014

Step 5. Divide Activity Totals by Objective Totals

Divide Activities (Verbs) into Objectives (Nouns) and order hybrid metrics by largest deltas.

metric totals aug 2014

Step 6. Make the move to real-time

Implement software that can track your real-time advanced numbers moving. We happen to think Ambition is a great option. Want an example of a finished product? Here's one below using Lead Conversion rate (Leads Created/Won Deals).

Susan Brown leaderboard

Now you're driving Effectiveness -- and not just actions. Action is easy. Effectiveness is where you get real organizational change and serious ROI.

Best Practice #1: Start With Daily Activity Metrics

QuotaFactory CEO and renowned sales performance expert Peter Gracey provides the core tenets behind starting performance measurement with daily Activity Metrics:

When you break a salesperson’s job down into a series of simple core ‘daily objectives’ they must hit every day, no matter what, you end up with greater return in the long run.  Positions within sales development and sales can be extremely distracting professions. There is always something else you can focus on that is shinier and sexier than the things you are supposed to do everyday.

And if you look across the sales landscape at today’s elite sales organizations, they all share one thing in common: an emphasis on hitting daily, weekly and monthly performance goals.

Whether you’re managing a global enterprise sales team in a Fortune 500 or kicking a startup sales team into high gear, taking a goal-oriented mindset to your daily sales grind is going to give your team a unique edge.

How so? Peter Gracey explains further:

When deployed and required, minimum activity metrics and individual database management KPIs ensure that the hard stuff gets done on a daily basis.  Without it, you get ups and downs in monthly performance that so many of us hate.

So before diving full-bore into Moneyball, remember that daily Activity Metrics are the foundation upon which to build your pyramid of predictable revenue.

Best Practice #2. Broadcast Performance on Moneyball Metrics

Want to enhance the power of your Moneyball Performance Metrics? I’ll let you in on an easy solution.

Give them to your reps. In real-time, if possible.

Many sales leaders still mistakenly believe that Moneyball metrics are for analytics geeks, only. Not the case.

The more data-driven, real-time, digestible, straightforward and transparent your performance feedback, the better your results.

Download the Sales Performance Index

For sales reps, reaching (and exceeding) quota starts with understanding how daily behavior and KPI accountability aligns to the organizational goals.

Tracking Moneyball Sales Metrics and exposing progress incentivizes employees and empowers managers with the actionable intelligence needed to make important decisions.

Done correctly, Moneyball metrics can tell you a great deal about your overall sales process efficiency, what motivates your sales reps, and which aspects of your process are and are not working.

The results: Smarter oversight. Better alignment. More wins for the home team. To learn more, download our comprehensive eBook, The 2016 Sales Performance Index, and get 40 pages of industry-leading insight on measuring and driving performance across sales, marketing and account management.

*Featured Image Source

About the Author

Brian Trautschold

Brian Trautschold is the Co-Founder and Chief Operating Officer of Ambition. He loves SaaS, the Memphis Grizzlies and helping sales organizations kill it with equal passion.

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