The War Room and What It Can Tell You

Jason Jordan and Michelle Vazzana

So there we were… the War Room.

Our Fortune 100 client was showing us the sequestered conference room where their senior leadership gathers weekly to review business performance and set strategic direction. On the walls hung a sea of performance reports showing everything from current financial projections to the number of customer-facing calls the sales force had conducted year-to-date. Literally, hundreds of data points culled from their customer relationship management tool and reported in vividly colored charts for their leadership team’s real-time consideration.

Looking at the walls, it was easy to envision a typical weekly War Room meeting. It would resemble the classic scene from a World War II Hollywood movie where analysts scurry about the room updating information on the walls, while leadership takes it all in and formulates a strategy to outflank the enemy. Except in this case the generals are VPs of sales. The soldiers are salespeople. The battlefields are sales territories. The numbers on the wall are not enemy headcount – they are product sales, pipeline size, sales rep activity, win/loss ratios, profit margins and, of course, revenue forecasts. Anything and everything that can be reported has a spot reserved on the War Room walls.

So what has all this reporting gotten us? Well, having all this data at our fingertips has become like comfort food for leadership. A real-time view of sales force performance makes us feel in touch with the organization. And increased transparency to field-level activities gives us the satisfying sense that we are somehow in control of the sales force’s behaviors. However, visibility to an action does not equate to control over it.

What Can We Really Manage?
So with all this information at our fingertips, we are little more able to proactively influence sales force performance than we were billions of dollars ago. We are more enlightened about what’s happened – and even what is currently happening, but we have little more control over the future than we did in the past. What then are we missing?

What we are missing is quite fundamental: We are missing the operating instructions for a sales force.

How do the numbers on the War Room wall “work?” Of all the data points that we see on our reports, which are the inputs, and which are the outputs? Which are the causes, and which are the effects? If I want to move this number, should I push that one or pull another? What we don’t yet know is how to work the numbers.

To understand how metrics are being used to manage sales forces, we first partnered with the University Sales Education Foundation[1] to survey its corporate constituents. Specifically, we asked sales leaders to provide us with the data points that they found the most meaningful in driving the performance of their sales forces. We then expanded the scope of the research to include our own client base, adding data from actual management reports that are being used at both the executive and field levels. In sum, we gathered 306 metrics that were considered by leadership to be the keys to effective sales management.

The Question
So there we were ... Our own War Room.

Or at least that’s what it resembled with our 306 metrics hanging randomly about the walls. Except that unlike the real War Room generals, we were not there to lead – we were there to follow. We were going to follow those seemingly random numbers wherever they would take us, as long as we ended up with a coherent framework of sales force metrics. But how then should we begin our sure-to-be-frustrating journey?

We chose as our tour guide a single question. The question that had led us to this point in time, and the question that would hopefully lead us to crack the sales management code:

Can we “manage” this number?

In the end, we discovered that some sales numbers are in fact quite manageable. These are metrics that relate to field-level activities. At the other extreme, we determined that many numbers are completely unmanageable. These metrics track high-level corporate results. We then teased out a third category of numbers that lies somewhere in between – not really manageable, but vulnerable to influence. These middle-ground metrics refer to the sales force’s objectives that serve as a pathway from activities to results.

Eventually, we uncovered some very important insights into the challenges and limitations of sales management:

  • We discovered that not all sales metrics are on par with one another – some of the numbers on War Room walls can be managed with the degree of control that leadership expects, but nearly 80 percent of those numbers can only be influenced indirectly
  • We established a series of causal relationships that can be used to coerce those unmanageable numbers with a high degree of certainty – managing sales activities leads to the achievement of sales objectives, which in turn leads to the attainment of business results
  • We had identified a means to reverse engineer high-level corporate goals and connect them to sales force activities – beginning with the end in mind allows us to architect a series of interrelated metrics that enable us to manage toward our desired outcomes.

Looking back at our point of departure, we felt like we had written the first few pages of the desperately needed operating instructions for a sales force. The numbers on the wall now had more meaning, and we’d learned a bit about how they can be used to exert control over sales force performance. However, we didn’t feel that we had cracked the code. We needed to learn more about how the numbers actually work.

Jason Jordan and Michelle Vazzana are founding partners of Vantage Point Performance, a global sales management training and development firm. They are the co-authors of Cracking the Sales Management Code, from which this article is excerpted.