Many managers attempt to manage their people by “managing” numbers. They track the number of opportunities in the pipeline, the number of appointments booked, the number of quotes/proposals generated, and the number of dollars generated; then they hold people accountable for maintain some predetermined levels.
While you think you can track numbers, you can’t actually “manage” them anymore than you can manage the weather. And like weather, all you can do is observe and analyze. But, it is from the observation and analysis (of the numbers, not the weather) that you can identify pathways for improved performance.
Here’s an example. Emily sells life, health, and disability insurance to owners of automotive service centers and gasoline stations. She has a large geographic territory. Her company’s recommended (number-driven) selling strategy is to get in front of as many owners as possible each day and give a sales pitch. Just drop in, ask for five minutes, give the pitch, and try to get them to sign on the dotted line.
Emily followed that strategy for quite some time and did surprisingly well, but at a price. She would often leave her house at 5:00 a.m. so she could catch a business owner opening the doors at 6:00 a.m. And, it was not unusual for her to still be making presentations at 8:00 p.m. She was driving hundreds of miles a day to drop in on unsuspecting prospects.
Emily's sales figures were rather good. She was the top salesperson in the region for several years. But, she was working hard. She didn’t know how hard until she analyzed her numbers and the associated activities. She found that she spent most of her time driving to see people who didn’t have time to see her and presenting to people who had no interest in what she had to sell. The least amount of time was spent with real prospects.
Why? Because she was trying to manage numbers--three sales per week. So, she would see anybody and everybody until she closed three sales, even if that meant working on Saturday.
Her analysis revealed that her closing ratio--completed sales vs. presentations given--was very low. After all she would present to anyone who would grant her five minutes. By her own admission, many people let her make her presentation only so that they could get rid of her.
Finally her analysis revealed that she closed sales with about 25% of the people who had real concerns about their insurance coverage. Here’s how the number broke down:
- 50% of the prospects were not willing to either change carriers or make necessary investments.
- Another 25% were ineligible for coverage for one reason or another
- The remaining 25% would buy
Emily reckoned that if she could identify and present to 12 people who had real concerns about their insurance coverage, she could close the necessary three sales--and do so in a lot less time and with a lot less effort.
So, she shifted her focus from trying to manage the numbers (3 sales) to managing her behavior--identifying 12 people with concerns about their coverage. She traded travel time for telephone time to contact, qualify, and set appointments with prospects who had genuine interest (even though that approach ran counter to her company’s established procedure).
Did her strategy pay off? Let’s look at his current “numbers”: working the same number of hours, she is now closing more than twice as many sales. What do you think?
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