To be fair, in my experience, sales teams have been resistant to process innovations as long as I remember. Plant operations, distribution networks, backoffice operations are unrecognizable from their 1990s counterparts, but sales funnels, pipeline management and key sales activity metrics barely changed in decades. While a plant manager from 1950s could not possibly run automated manufacturing operations or a robotic warehouse, a sales manager from the same era could arguable manage a current B2B salesforce. But not a B2C one. And that’s the point. Lean startups, agile sales and growth hacking emerged and thrived in a new sales paradigm while traditional enterprise sales carried on basically unchanged.
Having worked in the 1990s on Business Reengineering projects instigated by Michael Hammer’s research, most companies focused on core operations, manufacturing and backoffice. Not sales. The major award of the day was the Malcolm Baldrige Quality Award than many companies doing reengineering also aspired to. Out of the 1000 possible points towards the award, sales processes did not have a single point assigned. Sales process excellence was not perceived to be important to customer quality.
In later years we’ve seen the same phenomenon with Six Sigma and Lean. You would be hard-pressed to find more than 5% of companies who considered sales processes for Lean or Six Sigma. After years of search, I can barely find success stories attributed to sales transformation and growth due to these projects outside some narrow areas of inside sales, call centers and mass marketing.
But lack of adoption of Agile in large enterprise selling remains a mystery. It is well aligned with some of the innovations, like measuring sales velocity and linearity. In fact a burn-down chart (or burn-up if you like) can be a much better linearity and velocity indicator than any sales ratio. Even software shops with strong agile development culture would use the same funnel and activity metrics their ancestors did. 6-9-month long sales funnels are to 4-week sales sprints like 18-month development waterfall methodologies to 2-week agile sprints.
Many sales teams carry 60% or more stalled pipeline and similar metrics yet still run sales plays that are months-long (full funnel) vs weeks-long (sprints). Time to change that. The good news is that salespeople are actually very innovative and creative when it comes to their deals. That is why the best salespeople do not follow ineffective sales processes or succeed in spite of them. Agile Sales could be a way to select a few sales teams, let them loose with shorter term sprints and deliver product (sales) early and often. And obliterate their quotas in the process.
While more and more organizations want their sales teams to be agile, these initiatives settle in the familiar pattern of using tools invented for one function and force fit for another. And sales rarely fits anything overly structured. Most sales organizations don’t have consistent sales methodology and if there is one, process adherence is in the low double digits at best.
The process exceptions are mostly outside our control and therefore estimating tasks, sprints and completion time are very inconsistent. Great sales organizations close 30-40% of their deals. Basically working with 60-70% process waste. No other business function would survive with these waste levels. Sales operates with baseball odds where a consistent 33% hit rate is absolutely world class. That makes process adherence, linearity and forecast accuracy quite difficult.
As we settle in for our 6th year of using agile for sales (kanban), I worked with some teams inside and outside SAP on scrum for sales as well and there are now more proof-points and tools out there. Some of my thoughts on sales scrum vs sales kanban.
- Simple kanban boards with basic agile flow are easier to implement and adhere to for sales teams starting out (Backlog can be leads, Sprints are quarters or months, Todo, Pending and Done require no sales training)
- Teaching sales teams product development scrum terms is not value added, especially because we want sales teams to be customer focused and not product focused. This one lesson we need to learn from Lean.
- Most sales teams are well disciplined around sales stages (from lead to close) and those sales stages can be considered sprints and a 6-9-month sales cycle a major product release
- Most sales organizations already measure deal time in stages, linearity and other predictive metrics. They are easy to implement in an agile board
- Daily standups in sales are like watching paint dry. Things don’t move that fast. The sweet spot seems to be weekly and fortunately the weekly forecast calls can be expanded to have the structure of an agile standup. 15-minutes? Probably highly aspirational.
- Sales teams may need a lot more cross-functional collaboration than dev teams. Having outside orgs participate in forecast (standup) calls, or even conducting meta-standups with customers and executive teams can be great. We learned a lot by having quarterly customer forecast meetings (QBRs).
- Use tools that make the job easier. Sales folks who hate CRM still like kanban boards. We’ve used Trello for years and now see many new companies cater to the needs of agile sales, like Heresy.io.
- Sales teams are virtual. Kanban boards, burndown charts, forecast standups and retrospectives all need to be virtual too. Great tools can make or break team communication.
- Burndown charts are great to view sales linearity in a way that linearity percentages cannot possibly communicate.
After 4 Years of Agile Sales (LEAN as we called it) – there are many new learnings. Sticking to our focus on the standards of Lean Sales instead of some theoretical procedures, we can now take inventory of what worked at what didn’t so far. Today’s post is about what worked well. In a later post I’ll address innovation we are doing on things that did not work well or at all.
As a reminder here is the link to our original vision of how to set up your Sales Kanban.
THINGS THAT WORKED (MOSTLY)
Delivering on the WHY
The primary reason was to double the effectiveness of the team in terms of both pipeline and revenues per person as well as deal quality (net new vs existing customers). We definitely accomplished both objectives and that should now be table stakes.
Focus on customer value creation
We constantly validate our ideas with customers and shut down events, meetings and other activities that they do not see value in. Same with the so-called “business value added” (i.e. internal) activities. We prioritize internal requests by how badly the other party needs our involvement and output.
Make the team’s work visible
Maybe a year late but we are getting close to where I thought we could be in a few months. There are practically no status updates except on our Kanban boards (Trello) and in our KPI systems (forecast). Most team members update their task lists, track their progress on a daily basis. There is a measurable difference in work output for those in our team that work in a Lean way vs those that do not. We systematically eliminated many non-value added activities and projects and many team members routinely pivot on their project direction as a matter of business without requiring major reviews, offsites etc.
As a sales leader i can see 70-80% of activities, comment on bottlenecks, share best practices, intervene on bottlenecks. Given this is a completely dispersed virtual team with practically no face-time – I consider this the ultimate win
Limit the tasks you are juggling
Reducing WIP is forced through questioning what is adding value and by limiting available resources. Most of the teams simply do not have the resources for worthless projects and parallel activities
Measure your effectiveness
We keep the KPIs simple and focus it all on customer value add. Given we are in sales all activities are prioritized and measured in 3 categories: 1) deal origination (net new business) 2) deal influence (moving existing opportunities forward) 3) support (supporting internal teams). The percentage of time and revenue associated with each of these priorities are strictly measured against a predefined target allocation of pipeline and revenues. We did not do daily standups but our forecast calls were weekly standups of sort where we dealt with target effort, time and blockers.
Continously strive to improve
A lot of this actually happens as part of the work being visible and KPIs constantly reviewed. We still do our version of Kaizen events in leadership offsites but the focus is less on strategic and tactical pivoting (which happens as a matter of daily business) but more on execution.