Watch Where You’re Going: Aligning Your KPIs With Your Goals
What’s the opportunity cost of stopping to ingest another piece of sales-related content? Two sentences in, are you gripped with a guilty impulse to reach for your phone or keyboard and start making calls instead?
I’d like to redirect your energy so that your success in sales isn’t random or acute, but consistent and chronic — the result of a strategic, focused effort that means doing less and selling more.
Defining Success
If I “get you” to read this article, does that mean I’ve written it well?
“Well,” you might say, “that depends on your goal, I guess. What are you trying to do here —put words in my mouth?”
As tribal creatures, we tend to assume everyone around us is on the same page. And that we define success in the same way.
In Chapter 1 of The Psychology of Money, Morgan Housel argues that “Nobody’s Crazy” — every one of us handles our finances based on different values, informed by very different life experiences:
“In theory people should make investment decisions based on their goals and the characteristics of the investment options available to them at the time. But that’s not what people do. [In 2006, economists Ulrike Malmendier and Stefan Nagel] found that people’s lifetime investment decisions are heavily anchored to the experiences those investors had in their own generation — especially experiences early in their adult life.”
You might be operating under the assumption that you invest your time working towards what you want. All of us are taking the path that seems most reasonable to us, tracking activities that we believe are the most likely to end in success and avoid failure.
Just because you want something, however, does not mean that your efforts to obtain it are advancing your goals. It’s highly debatable whether or not your decisions are even driven by executive functioning to begin with.
Target Fixation
Anyone who has entered a corner too fast on a motorcycle has had to contend with a phenomenon called “target fixation.” The moment you realize you’re carrying too much speed and unable to turn sharply enough, there’s a strong compulsion to stare directly at your imminent dance partner, whether it be a guardrail, a tree, or a car in the oncoming lane.
In a “target fixation” scenario, you’re focused so intently on not hitting something that your body follows your line of sight straight into it like a tractor beam. Primal fear takes over in a sickening self-fulfilling prophecy.
To overcome this, look instead where you want to go; keep your eyes down the road at the corner’s exit, where you intended to go in the first place. It’s widely understood in motorcycle safety curriculum that “the bike follows your eyes.” Your eyes reside in a head that’s attached to a spine that prefers to stay relatively aligned. Your vision forecasts and projects your locomotion.
Too often, our sales activities and behaviors are driven by fear. We want something so badly, we behave in ways that actively work against us, annoying our buyers or — in a leadership role — setting unattainable targets that demoralize our team.
What do you want?
Seriously. Have you asked yourself, your boss, your partners, and customers this question lately?
Presumably, your team wants to sell more. That’s a start. But how do you think you’re going to get there? What are you actually paying your people to do?
To get your prospects to buy, you have to care about – and invest energy into – helping your buyers get what theywant.
Carol Mahoney’s Buyer First brings to the surface something many of us have felt as buyers but failed to internalize when the roles are reversed and it’s our turn to put bread on the table: “selling isn’t something we do to others. It is something we do with them.”
When panic takes control, we’re often so focused on the sale that what our buyer actually gets from us is more cold calls about the features and benefits of our products, further attempts to overcome their objections, and a rampant need to “always be closing” on our timeline — never mind their needs.
Confusing Activity With Achievement
Ahh, yes — the ol’ Wolf of Wall Street chest-beating, “rah-rah” approach to sales. Rally the troops, get those boots on the ground and make stuff happen. Sales leaders prescribe these tactics because they believe it will result in more sales.
The emphasis here is on activity and output. There’s something to be said for this strategy; it’s so prevalent because it works some of the time. It’s at least halfway there. Why? It’s a heck of a lot better than the opposite extreme, perfectionism: that unique brand of paralysis whereby nothing gets done because it’s not up to our impossible standards.
Most sales teams are too busy spraying and praying to stop and evaluate which of their sales activities are actually driving revenue.
In Slow Productivity: The Lost Art of Accomplishment Without Burnout, Cal Newport prescribes three key principles as an antidote to our frantic, scattered, unproductive efforts in the modern workplace: 1) Do Fewer Things, 2) Work at a Natural Pace, and 3) Obsess Over Quality. He offers a compelling blueprint for “pursuing meaningful accomplishment while avoiding overload” that holds counterintuitive value for our laughably overburdened sales reps across the 3-tier system.
“What Gets Measured Gets Managed”
Wine & Spirits sales veteran, Ben Salisbury, takes Peter Drucker’s principle here one step further: “what you measure, you get more of.” Simply being aware of this fundamental mechanism can mean the difference between self-sabotage and manifesting your goals.
Suppose that you decide to strength-train for months on end, measuring the number of sets and reps you complete for each exercise, every time you visit the gym. Would you not be more keenly aware of your progress, or lack thereof, than if you were only measuring how many times a week you visit the gym? If and when you discover that your efforts are making a difference, would this not motivate you to keep going, or change course and alter your behaviors if the results are not what you had hoped?
By merely paying attention to something. We are far more likely to invest the time and energy that it takes to improve it. Watch anything long enough, and it pretty quickly becomes excruciating to maintain the status quo. Chief among the reasons we sit down to watch Netflix — and not wet paint — at the end of a long day, is that the object of our attention must change, for better or worse, if it is to hold our interest.
Where this can backfire, of course, is if you measure the wrong thing. If your goal is to sell all the wine you make, but you spend every sales meeting and performance review focusing on the number of sales calls your team made and a number of accounts sold. You’re going to end up with a bunch of 1-2 case placements while your wine gathers dust in the warehouse.
Key Performance Indicators (KPIs)
If I looked at your CRM right now, what kind of story would it tell me about your goals?
Assuming you’re not just working with a glorified notetaker or worse — a plastic bin full of business cards and some outdated spreadsheets . . . we could pull all kinds of sales data into your dashboard:
- Accounts sold & unsold
- Number of sales calls by channel, account, sales rep
- Number of engagements (responses) by channel, account type,
- Order commitments vs. actual Retail Account Depletions (RAD)
- Surveys
- Promotional events and tastings
- Staff trainings and presentations
- Sales volume by brand, SKU, channel, varietal, vintage, packaging, size, quantity
- Lift
- Velocity
- Inventory
- Revenue year over year
. . . to name a few.
Are success in sales down this year despite an increase in account activity? Honestly, evaluate whether or not there’s been too much emphasis on quantity metrics that tend to propagate themselves like weeds without necessarily bearing fruit.
Off-the-beaten-path metrics like “churn” can help us determine the quality of the accounts we’re in. By devoting our limited resources to the “stickiest” accounts with the best fit for our brand. We can achieve far higher volume than we could by landing fleeting placements in hundreds of high-churn accounts.
It Takes a Village
If our internal behavior and goals are so often out of alignment, how likely is it that we’re aligned with our partners and customers on our mutual goals?
There was once a time when distributors were capable of actively selling to retailers on the supplier’s behalf. So much so that the supplier needed only to “manage” their distributors to succeed. In today’s unworkable bottleneck— thanks to too many brands and too few distributors. The best that a supplier can expect is for the distributor to match the supplier’s own efforts in the market.
For a supplier, success in 2024 actually entails morecollaboration, not less. In this “help me help you” scenario, timely and accurate communication with the distributor is more important than ever before.
Automation = Domination
As suppliers generate their own demand in the market and take order commitments. Keeping the distributor informed on activities in key accounts (and staying informed on the distributor’s activities) eliminates duplicate efforts and ensures the best experience possible for retailers, increasing the likelihood of repeat business.
Shared data isn’t just about retailer rapport. Updating sales and promotional targets and gaining visibility into the distributor’s execution against those targets as quickly and frequently as possible is a matter of survival. The beverage alcohol space is too crowded and competitive. The brands who communicate the clearest and fastest with their distributors will come out on top.
A few early adopters are already using automation to their advantage. Keeping their success in sales execution data and key account activity updated in near-real time between supplier, distributor, and distributor sales reps in the field. The brands and wholesalers who can afford these tools early on are seeing a sharp competitive edge. Taking advantage of this brief window of time before the middle of the bell curve catches on.
Granularity and Gumption
As with anything in life, our success in business depends entirely upon the relevance of the agreed-upon metrics we share with our partners to track our progress incrementally.
That last word, “incremental,” is worth camping out on for one last point.
We have trouble wrapping our minds around mountains, but getting to the top of the next hill is rarely a problem. Picturing a gargantuan goal all at once invites us to despair. Whereas granularity gives us just enough to manage at one time. Smaller units of measurement give our brains’ reward pathways more scaffolding to keep us moving forward. Consistent, measurable progress is powerful enough to carve canyons under the right conditions.
It’s not enough to just find the right KPIs. Evaluating progress across a variety of time horizons helps make sense of an otherwise overwhelmingly big picture, like grab handles on an industrial sized refrigerator.
In the face of daunting goals, we are most powerful when we are most vulnerable. Communicating frequently with our allies and embracing a willingness to hold one another accountable to the small, achievable, daily tasks is enough. Staying aligned means getting there in the shortest amount of time possible.
