Forecasting is critically important for salespeople and sales leadership alike. It's also one area where there are vendors pushing AI technology on one side and others saying it's 4th grade math. Prior to this episode I had spent a lot of time thinking about forecasting and when Reid reached out to chat, I couldn't resist the opportunity.
Forecasting is critically important for salespeople and sales leadership alike. It's also one area where there are vendors pushing AI technology on one side and others saying it's 4th grade math. Prior to this episode I had spent a lot of time thinking about forecasting and when Reid reached out to chat, I couldn't resist the opportunity.
Welcome to the sales management podcast, your source for actionable sales management strategies and tactics. I'm your host, coach CRM co-founder, corey Gray. No long intros, no long ads, let's go. We're talking about forecasting today. My guest is Reed Chalupka. He is the Regional Sales Director over at Artara. Reed, great to see you.
Speaker 2:Thanks so much, corey. Appreciate you having me and well done on the pronunciation of last name. I know that's not the one take is impressive Well.
Speaker 1:I try to care. I think people's names are important. The number of times my name was misspelled in the newspaper growing up and my mom got upset, I take it personally.
Speaker 2:Yeah, I do too, every single time. Person last name.
Speaker 1:Speaking of being personal and being upset about things you reached out to me about forecasting and the culture of forecasting, the way that it's done across companies, based on your observations and other folks that you've talked to in the industry. What do you want to talk about today? Related forecasting.
Speaker 2:So here's my experience. I've been at my company five years. I've been in various roles, from sales development, sales development manager, sales and enablement, and now I'm in a nice position as an enterprise sales rep and I've just never seen forecasting done particularly well and my VP that I'm working with now really open minded guy, really like him has given me the opportunity to revamp the way we do forecasting, the way we do deal review, because to me those two things go hand in hand and I have put together what I think is good or what I think aligns. But really just want to raise the discussion Because what I've seen it's just a lot of reporting up and it's not really scientific.
Speaker 1:Yeah, let's dig into that a little bit more. Well, the funny thing is scientific. My take, which we'll get to in a second, is that forecasting is fourth grade math and anybody that thinks it's hard hasn't thought about it very much. And yeah, they're one of the other pieces that obviously you're dealing with people, so everything is certain. You're going to have a risk of variability and risk or synonyms, so that's where people can get thrown off type one errors. Type two error statistics. So you might get a little bit of statistics in there, at least in terms of how you think about it. But walk me through what you saw that got you onto this topic, and then we can talk about how you're building it into your workflow today.
Speaker 2:Yeah, absolutely so. We have all the tools right. We have the sales source, we have Clary, we have all that great stuff and the deal reviews that we've done historically and this is not I'm not singling out one manager I've had, it's been the entirety of my experience have been basically just hey, you know how's this deal going? Do you think it's going to close? Just kind of like, you know not, not applying a lot of pressure, scrutiny or a framework across the board to all reps and to your point. It is fourth grade map.
Speaker 2:You can look at a reps historical close rate and you can look at various factors has the closed date been pushed down? All these different things Clary looks at. But what I think is missing is this pressure to you know, really dive into the depth and details of deals to find the gaps and find those. You know there's ones that everyone is bullish, from the C suite to the VP, on coming in on a certain date. But there may be a specific gap that means it's actually not going to come in, and I think that's what's been missing from my perspective.
Speaker 1:Yeah, I agree with that. I think. I think there's a subset of things that matter. So, let's, let's do this. Oh, a little fun activity. I've never done this before. We're going to go back and forth, so I'll name one, the new name one, and let's go with the ones that we think are most important. We're doing this off the top of our head. We didn't prepare for this. This isn't a skit, this is really just. I'm curious. Okay, so I'll say the most important thing to forecast if a deal is going to close or not is what stage is it in today? Now you, you named whatever you think the second one is, and if you think I'm wrong, then you can argue with me. That's cool too.
Speaker 2:Yeah, I mean, I've seen deals stuck in Sage six for months, right, and the rep is confident it's going to close every single month, right. So if you have a good sales process lined up right, that's step one you have a great sales process. It's predictable from stage. But I think a lot of organizations today don't really have that and a lot of it, a lot of that process is lacking. So, yes, stage should be important. I think there's, you know, commitment from a chain, like explicit commitment from a champion to get it signed from a certain date. Who knows the economic buyer right is you know? So this is a bit in the office of its later stage, then then where's the commitment?
Speaker 1:I think what we're what we're both referring to implicitly is do you have a sales process? Do you have exit criteria? Yeah, and that's the simplest thing in the world. What are all the different stages of the sales process, from prospecting to needs analysis, to scoping, if it's something that's more complex, where you skip that one. If it's more transactional, proposal to closing, which some people call negotiations, which is dumb because that tells your salespeople they're supposed to be negotiating, which isn't necessarily the case and then, finally, you get to close one. So, if you've got those stages and then for each stage, you define what activities happen in the stage, and then you also define what exit criteria must be met in order to go to the next stage, then you're rocking and rolling.
Speaker 2:Yeah, 100%, and I will say I think it varies slightly, right? You know, on a depends on what the deal cycle is. I think it's more predictable, right? If you have a very tried and true let's say a month long sale cycle, you know and you can, you have thousands of deals to back into and find the perfect data. But if you're selling to ultra enterprise, you know million dollar deals, right, like there's so many. From my perspective, you just have to pick those apart more because there's so many more moving parts and so many more factors. Right? Is security going to pose a block? Is legal? Is tech, right? There's just so many other things that can go wrong and can delay the deal cycle.
Speaker 1:Well, and that's why I picked stage, because under underlying stage you've got the stage duration. How long does it typically sit in this stage? So if you've got more of an enterprise deal and you're in the middle of the sales process, you might have a long duration because you've got to get security and legal and all these other folks bought in and then you've got some degree of standard deviation. Again, this is not advanced math. When do we learn standard deviation? Sixth grade, seventh grade, something like that? Yeah, when we're still couldn't dunk a basketball yet. So you got this really simple concept of OK, so average is 30. Standard deviation is 20. So that means what? The night of the funny? Ok, so it's not a normal distribution. I know that's more of an F distribution and I can't remember my F distribution rules up top of my head, but anyways. So if it's two standard deviations, which covers what? 95%, if it's assuming it's normal distribution. So it puts this 70 days.
Speaker 1:So it should happen 70 days or maybe down to like 15. So if you're forecasting something to close in the next five days and it's at stage three and you've got a 30 day average duration for stage three and you got a 30 day average duration for stage four, then it ain't going to close.
Speaker 2:Yeah, you're absolutely right and I think well. First off, I think standard deviation and dunking the basketball for me were both about ninth grade, so they decided about the same time. You there sounds like you were. You were earlier on the curve.
Speaker 1:I could. I could dunk in a trade.
Speaker 2:I could dunk.
Speaker 1:You dunk at four. How tall are you?
Speaker 2:Six, six yeah Me too.
Speaker 1:Wow, this is the OK cool. Yeah, I dunked for the first time in eighth grade and then by 10th grade I could dunk with two hands, so there was a. There's a nice distribution there, when the knees didn't work very well.
Speaker 2:Yeah, I don't think I could dunk with two hands today, if I'm being honest, oh.
Speaker 1:I don't think I could touch. I could touch the rim today physically, but I'm not going to try it because I don't want to hurt myself.
Speaker 2:I could be a cool part to. Yeah, yeah, yeah, you play one of them we want to just do old man hook shots against each other.
Speaker 2:Yeah, no, I definitely welcome that and I agree with you. You have basic math forecasting. I get that. I think that what I've seen and I think this is probably common place across the industry now is it marries pretty dramatically from rep to rep and I've seen so much turnover, especially in, you know, enterprise sales reps, mid market sales reps and this could be unique to my company, but I'm guessing it's not. And you know a lot of reps just don't come in and truly understand the business well enough. You know it takes a year or probably to ramp to an enterprise sales role. So it's it's tough to apply the standards to this new rep and I think you need more scrutiny there and you need to hope more holes. And that's where I think you know there's the art in science and I think that's where the art is lacking.
Speaker 1:Ok, so we're going to keep playing our game, which is you say something, I say something, so I'm going to I'm going to repackage what you just said and tell me if this is what you're saying, you need to have a I don't want to say a training program in place. I want to say that you have to have a handle on the competencies for the folks on the team and ensure that, a the people on the sales team have the skills and the knowledge and the mindset to do the job and, b if they don't, you're filling in those gaps for them. Is that what you're saying is a good leading indicator of if something's going to be accurately forecasted?
Speaker 2:Yeah, absolutely. And I think you know, like I mentioned, I have an enablement background to. I've trained a number of reps right and can easily tell right who's going to be good, who's not going to be good pretty intuitive, intuitively. But, like I mentioned, also there's this long tail of you know you're not going to expect an enterprise rep to be fully ramped with pipeline and closing deals for a year and anyway. So I'm curious you know you've written a book on this what, what leading indicators would you look at for an enterprise rep, like pipeline creation or to be able to tell you are they going to be, you know, good and contributing and within a standard deviation of the norm in terms of forecasting and closing?
Speaker 1:Yeah, I think there's a couple of things to look at. So the first thing is to look at them. And I talk about this competency framework. So I'm working on a new book. If you're interested in receiving a copy of the new book, send a note to freestuffitcoachsearmcom. It's on management. We don't have a. I don't think we have that completely dialed in yet. But first 10 people that send me a note says new book, freestuffitcoachsearmcom, I'll flip you a copy when it comes out It'll be later this year, Really dialing in on the competencies.
Speaker 1:So what are the skill sets? What's the knowledge, what's the mindset required to be successful in this job? And not everybody's going to come in day one and have everything that you want. So you need to understand where people at, where do they have mastery? Where are they developing their skills and where are they completely raw? And when I say skills, again, I think it's critical that we differentiate between knowledge is knowing stuff, skill sets being able to do stuff and mindsets being able to have the supportive belief that those things are the right activities to do. Because if our mindset is that mutual action plans don't matter, then we're not going to do mutual action plans. Or if we do them, we're going to go through the motions, we're not really going to believe in them, and I think that's that's one of the things for an enterprise rep. That's that's critical. So that's from the person perspective. And then from a leading indicator perspective, the question then becomes does the company have product market fit in the enterprise? Because we're using an enterprise in this example and I think a lot of companies don't have product market fit in the enterprise when they start, because they've got product market fit in SMB in mid market, and then all of a sudden they say, oh, we're going to go enterprise, or they do what I call fake enterprise and they think that a company has 3,000 employees as enterprise, which we can argue about that. But the difference is I wouldn't argue on that one yeah, because a 3,000 person company versus slumberj who has, I don't know, 150,000 people, it's a different deal. Yeah, so those are the. So then, is their product market fit? Is there not? Let's assume that there is product market fit, Then I think what you just said is spot on it's pipeline, but it's also the growth of the pipeline over time.
Speaker 1:So, month one are we getting deals into stage one and then are those progressing to stage two and stage three and stage four and beyond At the speed that we'd expect, at the deal size that we would expect. That's pretty much all you can ask for from a leading indicator perspective, and progression hinges on a few things A doing good discovery, because if you don't do good discovery, deals are going to stall. And then B which goes back to what I was going to say is my next biggest thing is do we consistently have next steps on the calendar? And that's what I posted about on LinkedIn today. I said look, if the sales enablement team exists and your sellers aren't consistently setting agendas and next steps, then just they're either completely incompetent or trying to sabotage your company, Because those are the most fundamental basic skills and if the team isn't doing those consistently, then enabling them isn't going to help. It's like buying a margarita machine when you don't even have potable water 100% agreed.
Speaker 2:I mean, everyone invests in so many fancy tools. It's very easy for enablement to go on to Gong or Clary or they're all merging. It looks like now one of these tools, right and see, hey, is RepA doing the things that you know our basic fundamental sales skills. Is RepB doing it? Okay, is this a team issue? Is this a rep issue? And coming back and doing a training, working with sales managers to hold them accountable yeah, I agree with that. The LinkedIn rant from this morning 100%. I think that's really important. I am curious and I'm jumping around a little bit, but right, I agree, pipeline is a good leading indicator stage progression discovery. What onus would you put on the actual sales rep for Pipeline Versus marketing, versus the SDR team? What's your like philosophy there?
Speaker 1:I think the sales person's calendar should be full with productive activities and if that means that, hey, they're working deals and they're on airplanes and they're in conference rooms and they're in boardrooms and they're working deals that exist.
Speaker 1:They're updating mutual action plans, they're having pre-meetings with a bunch of stakeholders. I mean, this is the other thing when you don't enterprise sales. This is why people struggle to get promoted, because they do these S&P deals. They talk to one person about one product and they get a contract signed, cool. Well, what happens when you have to have 30 people? Not kill your deal. You might not have to have 30 signers, but you have to have 30 people that know about it.
Speaker 2:Well, you have to build consensus and that's, I think, one of the things that I noticed too. I jumped straight into an enterprise role. I never did S&P sales, I never did mid-market anything like that. I was going to throw into the lines then, and it is right. You find a champion that you can text with and who's going to guide you through it. But it's really a matter of building consensus across many departments, many different individuals, and pointing out the detractors, overcoming them, and it's very democratic. At least we sell into healthcare, for context, that's the vertical right Health systems, hospitals, payers and it's a very democratic process, which I don't think is unique for our industry. Well, it's political.
Speaker 1:And that's the you know synonyms for democratic meaning representation of the people. Well, that's a political analogy and you don't want to be the person that's always sticking your neck out, being a rebel, Because the other thing that's very important to this conversation is in these larger companies, the high performers get promoted every 18 to 24 months. They either move into a role that's at a higher title, they move in to take a different team over, they do something different, so your people are constantly moving. So you've got a long sales cycle and you've also got a lot of mobility inside the org, at least from the high performing people.
Speaker 2:Oh yeah, absolutely, and I think, finding the champions too that are looking to get promoted on. You know the company you're selling into. Hopefully it's internally within their company I just had one of my guys left to be a CEO elsewhere right, and you have to. You have to have backup plans and backup plans and you know, I think those are all things that should be covered in the, you know, weekly deal review or whatever cadence of deal review that you do with your reps, and those should factor into the forecast, right, and to me that comes back to okay, you have all these, you know the basic math, the historical things, but you know, I also think you need to be able to find the outliers, and there's a way to do that with deal review, and that's how deal review should roll back up into forecasting, and in the format as well.
Speaker 1:And, as I've seen, no good, sorry.
Speaker 2:I've seen sort of like the rollups from Clary and like the predictability score and I haven't seen it really accurately. You know, take the information from a deal specifically right, like what a sales, a sales manager or VP could find, and feed that into it. It just bases it on like the simple historical data you know that you could you could put in a spreadsheet too.
Speaker 1:Yeah for sure, and I think, when you look at forecasting at a high level meaning here's the CRO's forecast for the month or for the quarter it's self-fulfilling math, because, if I'm see, I'm 10 weeks into a quarter. Well, I already know what we won, I already know what we've lost, I know what our stage duration is meaning how long it's going to take for a deal to work itself from stage two to stage three. That means that, at this 10 week of a 13 week quarter, there's only so many deals in play and I'm not calling none of these computer systems. Call it and say this deal is going to be one, this deal is going to be lost. They're averaging over that universe of deals that exist across salespeople, and they're using information that's available and look it's. It's kind of hard to be off with that forecast, given everything I just said. Now, if you're saying two quarters from now, what are we going to be at? None of these systems are going to even try to tell you that, because that's the hard forecasting. And I think, when you think about it, though, is it really that hard? Let's, let's talk about this, let's talk about how we could do forecasting two or three quarters off into the future.
Speaker 1:Well, imagine that we don't have salespeople. Imagine we have machines and nobody's going to cancel me for dehumanizing salespeople in an analogy solution Can't be canceled. If you don't apologize, I'm apologizing for this one. Okay, imagine everybody on your team as the salesperson. Now they're a machine. Well, we know what that machine's capacity to produce products is. Let's say it produces one widget a minute. Well, if it produces one widget a minute, we know that, and we know what the capacity utilization is. Let's say that that machine works 24 hours a day, seven days a week. Well, salesperson, you know they're probably going to work like eight hours a day, four and a half days a week. So let's let's call that what their capacity utilization is. Well, how many needs can they do over the course of that time period? Okay, that's what they can do.
Speaker 1:So the question then becomes are they working on prospecting, trying to find new deals to bring into their pipeline, which is a use of time, or are they working on working deals that exist in their pipeline? And that question is easily answered. Rule by how much money are we going to put into marketing? Because if you put enough money into marketing and you size your sales team right, meaning that you have enough. You only have enough people to manage the pipeline that you've got and you don't create a starvation environment for everybody. Then you roughly know how many deals you're going to be working. You know what everybody's capacity is. You know what their capacity utilization should be. Therefore, given a constant win rate, deal cycle and deal size which are predictable within some variability, kind of know what the forecast is going to be and you don't need software to do that.
Speaker 2:I agree, that's sort of like the utopia, the utopian forecasting state that you just described. How many companies do you fully believe, though? Have the product market fit, the right spend in marketing, the right territory, allotment for sales, working, the right number of deals, or are these companies trying to back into these VC numbers that they've committed to through funding over the past five years?
Speaker 1:Well, I think they're backing into the numbers because they have to, because if you go to your board and say, hey, we're going to grow 150% next year and everyone else says they're going to go 300% next year, guess who's not getting funded? You, right, yeah.
Speaker 2:But my perspective would be that that would be the vast number of companies who already have the shots called for them of the numbers they need to hit, and they're working. They're doing the basic math of okay, we need to hit this number, that means we need to have this many salespeople, and they're not taking into account the TAM or the product market fit or the macroeconomic conditions. It's just a matter of like hey, we have to figure out a way to back into that.
Speaker 1:We don't get funded because you look at the public companies that have more traditional businesses, the world pools of the world and things like that they generally hit their forecast Right. Yeah, they might miss by a little bit, they might exceed by a little bit, but go look at forecast accuracy for these big old multinational companies that have tens of thousands or hundreds of thousands in place. They can forecast accurately because they have a few things A proven business model with some predictability. B people that are good at math, which I'm sure venture-backed companies have people that are good at math. But are they Right? Yeah, are the people that are looking at the numbers really that great at math? Is it really that hard? It's not hard. It's so simple. If you've got 20 people on your sales team and you know what they can do, then you should know what your forecast is. It's not hard. And if anybody thinks this is hard and wants to debate me on it freestufficochetmcom. Freestufficochetmcom. Send me a note. I'll be on the show.
Speaker 2:If it's not, if it's not hard, why do you think there's such paramount importance on that Like? This seems like the primary job of VP of sales CRO to ensure that it's 100% accurate, and I understand you don't want to. You know if you call something, it's pretty catastrophic. You know, for shareholders, whatever if it's off. But if it's as simple as you say, why, why is the high? Why are the highest-paid jobs Like? Why is this their most important response?
Speaker 1:Because it's not. They don't get paid to forecast the number. They get paid to hit the number that they need to forecast.
Speaker 2:Yeah.
Speaker 1:Different things. So the hard part is okay. So, in order for us to hit this growth profile that we need to hit, in order to receive the capital that we need to build a product that our customers demand, then we need to close $5 million this quarter. Okay, cool, how are we going to close $5 million this quarter? Well, here's what we've got and then, yeah, but it's, it's so here's. Here's where I'm going with all of this. Imagine a world where, instead of a big top number and you're like we're, we're projecting, we're going to be at 93% of our number this quarter. Imagine, for you can do that too. That's fine. I think that's important. Not saying that none of this stuff's important, right? What I what I'm saying is that we're missing an opportunity to dig down to the salesperson level and identify okay, what are we forecasting for each individual and what could we do better with each individual across the organization in order to change that number. So, for example, if we've got somebody on the team, what's called them little Timmy- I was using.
Speaker 2:I'm sure there's people out there named Timmy.
Speaker 1:That hate me, but I just like little Timmy because you know it's a fun name to say. Little House put little Timmy in front of little Johnny already has a reputation. So little Johnny, yeah, so little. Timmy is over there and he's sitting there. I think I think I got this from Pauli Shore. By the way, I just it's just great because I'm 40 and I grew up with Pauli Shore. I'm sure anyone that's 60 is like Pauli Shore is an idiot. Anybody that's 20 is like who's Pauli Shore. But anyway, anybody else is mine.
Speaker 2:I'm 30, 31. And I'm like Pauli Shore, I'm kind of a mess for me. So yeah, yeah, yeah, okay.
Speaker 1:Google him. He's, it's, it's. It's easy as hilarious. His mom's. His mom was the owner of the comedy store where most of your favorite comedians got their start these days, including Joe Rogan, who's now doing the big comedy thing in Austin, where I live. I performed on his stage before. It was fun. If anybody wants to meet you, stand up. I'm not posting that on the internet, so find me live, all right. So here's, here's what I'm saying.
Speaker 1:The individual salesperson imagine if you could say, all right, well, look, we got a little Timmy over there. His win rate's a little low, his deal cycle's a little long, his deal size is a little low because he either takes the first thing that comes in or he discounts too much. Well, let's, let's look at all those factors and let's look at his forecast. And his forecast isn't enough to support what we need him to support for the company. Let's say that you got to quote it, 250,000 worth forecasting. Will it send me to be 150,000? Well, there's a few very simple ways we can get from 150,000 to 250,000. We can either increase the number of deals he has so he can prospect more, or we can give him more deals for marketing. We can increase his win rate. We can increase his deal size, or we can increase the speed at which he closes his deals and pull some things forward from the following quarter.
Speaker 1:Well, let's identify what the best opportunity is. It's either the biggest impact, maybe it's a quick win, something like that. Let's get that manager super focused on coaching little Timmy in order to have that impact. Oh, by the way, it's not just a little Timmy. We have 20 people on the sales team. We have 200 people on the sales team. Let's have each manager in the org do that same exact analysis for each person on their team and then execute their coaching skills. Oh, but, by the way, we're going to have to get the managers out of the prospect calls so they're not super closers anymore. Now they become more analytical and coaching focused, as opposed to just trying to be super salespeople to manage your titles. What say you?
Speaker 2:A hundred percent.
Speaker 2:I think getting getting sales managers coaching and honing so that their reps right is the goal.
Speaker 2:From what I've seen, there's such a you know my perspective again is limited mostly to one company, but there's always such a stress to hit the upcoming number right that it's harder to take a step back and think like, okay, what would truly scale the culture of our organization and improve reps across the board, as opposed to?
Speaker 2:You know we need the manager to see super close right now. So you know the BP's forecast for this upcoming quarter is correct and you know little, timmy hits his number, gets his commission check and is able to stay in the role for another six months right. So I agree with you, like, I think, the focus on coaching. You know, I know you have the coach CRM product and shirt and I 100% agree that's where we need to go to. But I think you know, in the trenches offering my perspective, I've just seen there's such a focus on hitting the short term goal that oftentimes we sacrifice this, like you know, for establishing a framework and coaching for the long term, yeah, which is crazy to me, because so many people talk about being strategic, Right.
Speaker 1:Well, I think that people say that word without really understanding the gravity of it, because strategic, by definition, has nothing to do with this quarter. This quarter is all tactics. You're not going to roll out a new it's. We're recording this on September 5th 2023,. I'm in a company that rolls out sales methodology closely. If anybody's struggling to consistently hit their goals or do anything else here, shoot me up. So if you decide you call me a K Corey we'd like to roll out sales methodology, I could get it rolled out this quarter to your team. You're not going to see results.
Speaker 1:Maybe you'll see some quick wins because you probably wouldn't even sign the contract till the end of September, and then we'd have to schedule sessions with the team and they have to start doing the pre-work. Yeah, so in October they could start doing some things. That would start to have impact. But you're not going to see that impact immediately. That's strategy.
Speaker 1:Strategy is saying hey, we've got this disconnected world where all the sales people are doing their own thing. There's no common language. Managers are struggling to coach, reps are performing inconsistently, both in terms of what they're doing and the results that they're seeing. We need to implement a standard, structured sales methodology that's easy to learn, easy to do, easy to coach that strategy. Well, yeah, that's for next quarter, that's not for this quarter. This quarter is all tactics and it's basically what can we do to get through this quarter. And you've got a choice it can either be micromanagement and super closing or it can be well, let's coach the heck out of these people and up level them to the extent that we can in the short period of time that we have 100% and I think the strategy component right.
Speaker 2:That requires buy-in not just from sales and sales managed, but rev ops right. You have to make sure whatever you're having the reps fill out in the CRM isn't duplicative or you know that it's actually in line with whatever sales methodology that you've chosen, that you're not having reps report verbally on things that you know they fill out every single day, that ever call. That data is very clear and then you can dive into and you know, figure out okay, if it's a pipeline problem, how much of that do we want to put on marketing versus the SDR team?
Speaker 1:That strategy okay, we need more than five percent. Does marketing do the SDR do it? Does sales do?
Speaker 2:it and yeah the easy part is sales.
Speaker 1:Does it? Because when I started back in 1991, I just got a yellow change. She got cool got it.
Speaker 2:But is that the most sufficient way? Absolutely not. You're paying, you know. That's not why you're paying the reps.
Speaker 1:So, and if that's what you need if marketing is not generating this. Another strategy thing if marketing is not generating leads, how many people do you have marketing? What are you spending on? Well, cut half the marketing team and give the salespeople cash to go buy stakes for people. Go buy airplane tickets and stakes. You'll probably get more pipeline.
Speaker 2:Yeah, oh yeah, absolutely yeah. No, I think, I think, yeah, the shift from from tactics to strategy and really establishing that foundation, because it's funny to you know, the average tenure of a VP of sales is what? A year and a half, two years, I think, I've heard thrown around. So there's typically not, there's a fire, you know, under their butts from the very short term, right, they're like, hey, we need to come in and win. Now they're incentivized to hit their numbers in the short term and keep hitting them, and keep hitting them. And I think that's at the expensive strategy and organization.
Speaker 1:Well, the problem is I'm going to isolate this to one thing that I see all the time it's the inability of the frontline managers to diagnose the biggest opportunity for each person on the team. And look, I'm not saying this because I'm a founder of Coach CRM. I founded Coach CRM because I'm saying this. And when you look at a team and you say, how do we figure out what to work with them on, it's about this diagnosis piece I'm not even at the coaching conversation yet For each person on the team, what is the biggest priority? And then, after we get done with that priority, what's the next biggest priority and what's the next biggest? And can we look at that list for each person and do a root cause analysis?
Speaker 1:For example, if I see that Will Timmy isn't asking good discovery questions, he's not managing resistance, well, he's not telling customer stories and he's not setting next steps. Yeah, sure, I could prioritize all four of those things and have four different coaching conversations over the next four to six weeks, sure. Or I could say, hey, I'm a smart person. What if we just coach Timmy on doing better pre-meeting prep, where he got all of those things together in advance of this conversation and ensured that he executed on them. Now I've taken these four things I could coach him on, I've consolidated those into one and I can have a really effective, impactful conversation with Will Timmy. That is an example of what we see when managers are experts at diagnosis and prioritization.
Speaker 2:I really like that. I guess, in terms of developing the framework for what good looks like for the managers to coach to and running this diagnosis, is that something you see as like VP of sales prescribes down sales enablement does right, because I think you're 100% right. I think a lot of companies lock the framework for managers to be enabled to do this in the first place.
Speaker 1:Yeah, well, that's why they need a sales methodology and they need one that actually works. And that's why Hillman created a triangle selling, because all these companies are running around doing medic, med pic, whatever Okay, cool. So how do you demo with medic? How do you land and expand? How do you create velocity between meetings? How do you use active listening? All those are bolt-ons and that's why the companies that sell med pic training charge like a million bucks, because there's so much stuff that you need to twist and turn and contort it to actually make it work. Challenger how do you demo with Challenger? How do you get a 23 year old to use Challenger in the same business that a 50 year olds use a Challenger? It's definitely completely different.
Speaker 2:Right, and yeah, medic is qualification. Right, it's just a checklist, it's great for the CRO.
Speaker 1:So that's the same thing as these forecasting software tools.
Speaker 2:They're for the CRO, they're not for the sales rep and they're not for the front line manager.
Speaker 1:And then you've got the other, the big methodologies that existed before the internet started, and they haven't changed much.
Speaker 2:The Miller, hyman and Blue Sheets right Like yeah you said it not very, very, very sorry. They're cumbersome, to say the least.
Speaker 1:So yeah, and I think that's you use cumbersome, I mean, it works right. If everybody did a Blue Sheet for every single deal, they'd be in great shape. Guess what, though? They're not going to do it?
Speaker 2:No, they're absolutely not, because that's you know, speaking firsthand now as a sales rep, that's the thing that I like. The least is just filling out data and data and data, Right when I I know that's not. You know, I have all this stuff in my head and there may be a couple things I'll catch, but, to your point, it's not really a revenue generating opportunity. I could be creating pipeline and could be actually advancing a deal, as opposed to like manually filling out all this stuff that you know, let's the CRO know. Okay, this is a deal that's in good health.
Speaker 1:Yeah, totally Okay. So I'm going to push back on this a little bit, just for something I'm in.
Speaker 2:Yeah, no, let's get it.
Speaker 1:Do you really know? And here's, here's what I mean when I see notes in the CRM from salespeople. There's three types of salespeople. There's folks that don't fill out the CRM, sure. There's folks that use excessive narrative and they're like oh, look at my notes, over a thousand word essay on this fricking, decalled it ahead. And then there's the third group, and what the third group does is they take all of the things that are in their head that they saw in the call and they synthesize it into its purest and most concise form. And I would argue, as someone that's published eight books, that anybody's first draft of anything sucks. And in a world where salespeople say things like, yeah, I know what's going on with the deal, do you, can you articulate the pain of if they don't buy in the next three months from us? Here's the bad thing that's going to happen. And in a lot of cases, look, there's I've got a couple of customers that sell one thing to one stakeholder and there's only two pain points they saw, and it's air being right, and that's simple.
Speaker 1:That's easy Other folks. So, for example, if you're selling a business intelligence platform, you're selling lots of things to lots of folks with lots of use cases, and it's it might be the same sometimes, but it's always going to be a little bit different. So, in cases like those where it's more of a platform sale as opposed to just a product sale that has a single use case, can the salespeople articulate in summary format and in a way that justifies the deal being at the stage that it's, at the exit criteria we talked about earlier, all of those specific things that you need to know pain, for example? That's that's the thing that I want to always push back on folks when they say that the salespeople know it, because even if they think they know it, have they beaten it up and edited it? Because I always say the first draft of your book is 30% done, 70% is figuring out where are my gaps and how do I fill in my gaps. And the same thing applies to deals, especially deals that are enterprise longer term.
Speaker 2:I agree with you. I just don't think. I don't think filling out a blue sheet right Is the right answer to that. Or like filling out like a bunch of data that's independent of the CRM, that's not going to be able to analyze.
Speaker 1:Well, for sure, no, it's a little ops are feed into the Fordicast control.
Speaker 2:I'm not saying like oh, I am in complete control and know every single one of my deals. I'm just saying like it makes no sense to have you know some tool that's not in the CRM to fill out all the stuff and be used as the gold standard for is this good or is this not good?
Speaker 2:It just creates duplicated process for salespeople, right? There's nothing worse than like Okay, I filled out information in the CRM, I'm filling out this other you know board deal review PowerPoint that we have to do, and then I'm, you know, saying the same information once again and by whatever weekly team meeting, right?
Speaker 1:100%. We're on the same page with that and I think what we're highlighting is the idea that everything is product development. I've done a couple shows on product development and if salespeople understand product development, go go Google. Anybody's listening to Google, bj fog, bj FOGG, and look at his B equals MAT curve and what it does is it says that the higher the motivation, the higher the tolerance for friction. I'm paraphrasing the lower the motivation, the lower the tolerance for friction.
Speaker 1:So what Reed's describing here is a world where, yeah, he's motivated, close deals, but why would he fill it out twice? I mean, I don't think you should ever do that. But what? Why would I do this admin work? Like, what's, what's my motivation to do this admin work? And if a salesperson has low motivation, you've got to make it super easy for him to do it.
Speaker 1:And creating a PowerPoint, adding another thing, whatever it is, whereas I just tell these people like, look, if you're not happy with the sales team, have them articulate pain and next steps in the CRM, make sure whenever the deal loads, those two fields are at the top. It goes to the detail page in Salesforce, not activity. Minimize clicks, make it easy and report on it and make sure that them and leadership is actually looking at the report Again. This is not hard, but so many sales enablement teams have these folks out there doing all this stuff, like, oh, I'm doing lots of activities, but the salespeople aren't setting agenda, setting next steps, doing discovery. Those are all things that matter. Throw all the content away. Throw every slide that you've ever made away and just let them. If you threw every slide that ever existed in trash and all the people on the sales team set good agendas, uncovered pain and set next steps, they would be substantially better off than they are today.
Speaker 2:Yeah, you just simplify things and I agree with you. It's funny, I use a scratch pad. We don't even have a paid account. The reps have been reaching out to me not the right person at all for the last six months, but I'll give them a plug on this, just because I like the product. But I have the column that feeds in the Salesforce for both pain and excess rate and that's how it's easy for me to.
Speaker 2:You know, you organize it by six, five, four, three, you know chronological, by stage, and then you have a couple of key fields and you can edit it, edit out, and I, you know I don't do those things for the CRO, I do those things for me. So I can, you know, whenever I come back to a deal, come back and have that perspective and continuously update those. If we find more pain points or find out one's not really real, they're going to drive the deal and then obviously like next steps. Those are just like the basics of like managing a pipeline and you know an array of deals, right. So I agree with you there and I think that's finding that balance between, okay, what's enough information, that we're confident that we're finding all of this right.
Speaker 2:I think you know certain methodologies are overkill and add too much friction. But there there does need to be some friction, right, you need to make sure that you know sales reps aren't just flying, you know, by instincts, and that there's actually some data, data that's collected and that they're routinely filling out. And I think you know that balance striking that balance is hard and I haven't necessarily I've seen it done overkill, where sales ops locks everything down and everything's a required field and that's just a substitute for good coaching, right, like it's a, you know, trying to trying to put a bandaid through sales ops by getting you know, and that doesn't work either.
Speaker 1:Yeah, if you lock fields or make things mandatory, you're just admitting your front line managers aren't good at coaching.
Speaker 2:Yeah, that's it 100% and it's a. It's a lose, lose for everyone. Right Sales ops becomes the bad guy. Reps hate doing that. You're not getting good information if everything's locked down.
Speaker 1:Yeah, exactly, I'm like locking down is not, lockdowns don't work.
Speaker 2:Good double inch hunter there.
Speaker 1:Yeah, yeah, we're coming up on lockdown season, yeah, I know Hope it's noted for the revival.
Speaker 2:you know enable you to keep living the Airbnb life for the next six months and come for it.
Speaker 1:Oh yeah, Well, no, we're not there's, there's no more lockdown, so I just I was telling people. I said count the count the number of times I'm saying I'm not giving my opinion on this, I'm just throwing this out there. Count the number of times you hear the words masks and pharmaceuticals. Also, count the number of times you hear the words exercise, lose weight, eat healthy and get vitamin D, and just compare those two numbers. Just compare the two numbers. That's it.
Speaker 2:Yeah, no opinion offered no, it's a good analogy to locking down with sales ops. First coaching right and yeah that's so good, okay, so.
Speaker 1:So. So, where a mask lockdown, take the vaccine right. Locking down fields, coach, train, develop, lead is leaving the fields open.
Speaker 2:Yeah, Eating your vitamins, exercising get vitamin D.
Speaker 1:Exercise, get vitamin D. Yeah, I'm not a doctor, but I don't think you need to be to give that advice.
Speaker 2:I just lost 50 pounds.
Speaker 1:I feel so great and that's one of the reasons I did is I really care about my health, and I think that in a world where I wasn't in good physical shape, I was worried. I said well geez, there's this thing and it attacks people that aren't in good physical shape. I should probably get in good physical shape. So there we go. Motivation right.
Speaker 2:Nice Congratulations, by the way, thank you, you should be in dunking shape I would imagine Well, I dunked.
Speaker 1:So last time I dunked was 2014, 2015. It was either late 2014, early 2015. And I was 200 and I was about 220. I'm about 215 now. So gravity wise I'm good, but I'm also nine years older. So, man, I don't know, we'll see, maybe I'll do some calf raises or something and try to get back into dunking shape. I just, I don't know, I'd rather be good at golf and tennis and pool, and we're really working on a pool game. So anyway, it's fun with those types of things.
Speaker 2:Yeah, absolutely, you graduate to those sports as you're buying. Yeah, I graduated, so all good.
Speaker 1:I graduated away from basketball, plus everyone that's my age that plays basketball is overly physical and not fun. I never lost 60. I don't think I lose anymore. The old man ball yeah, old man ball. Yeah, I played against them. When I was an ice player I used to play. I called it old man ball. Of course, I'm sure they're way younger than I am now, but we got physical and that's how I. It was great. It was one of the best learning experiences of my life. When I was in high school, I would play against guys in their 30s and 40s and they were brutal because a lot of them couldn't run as fast or jump as high as they used to, and so they just compensated for it with strength. And I'm sitting there, skinny 16 year old kid getting beat up by these older guys and it just builds character. It shows you that, look, you're playing this game, but there's a lot of other people playing the game and they have different life experiences, different skill sets than you. So rock and roll.
Speaker 2:And the teamwork too right.
Speaker 1:Like they've been playing for 20 years, they know the the ends and outs and yeah, yeah, I mean, that goes to the point of well, if you're turning over leadership every 12 months or something like that, is that really good? What's it do for your team? Right, yeah, if you're promoting people, that's great, because then all of a sudden you've got this mentor network and leadership network and folks that can pass knowledge down from one person to the next. But imagine if there's an Amazon tribe and instead of the elders gaining the knowledge and being able to work with the folks over time, they just left and went to another village.
Speaker 2:Right, then you get a new village leader every 12 months.
Speaker 1:Oh man, there's your anaconda sayings, or what's like during rainy season, do we go swim in the river and the anacondas come get us? I don't know. I was watching somebody show me a snake video the other day. Did you know? I know we got it. We got a wrap here in a second. Did you know that almost all of the furry animals are gone in Florida because the pythons have taken over the every good?
Speaker 2:I had no idea what so, like squirrels, chipmunks, yeah, like there's no rabbits no squirrels, hardly any deer.
Speaker 1:If any deer, they're all gone because the pythons ate all of them.
Speaker 2:So what are the pythons? Move on to post for animals, I don't know, but maybe us. Yeah, I guess you can get raising this stat of the average. I don't know.
Speaker 1:Oh man, all right, read any last words on forecasting.
Speaker 2:Now I think this was helpful for me in thinking about it too. I have a lot of different perspectives and I'm working on the leadership perspective and what works, and I think forecasting and the overview right Kind of like the art and science. To your point, it's easy to predictably say, hey, based on our rates, we're going to hit this number, but I think the reality is most companies need to stretch and hit a number, at least in my world, privately held sorry, bc funded companies that are prescribed the numbers. So I think that's where, to your point, this coaching and enablement conversation really picks up and you need to diagnose reps and figure out, okay, what exactly is the problem, and build a strategy and culture and invest in infrastructure and keep a VP around for a couple of years to be able to do that. Yeah, I think I can play forecasting issues with a lot of other issues I see, but it's you know, there's more fundamental ones that can be solved to improve it.
Speaker 1:Fundamentals. Make things fun. Read Great Avenue, the sales management podcast like, subscribe Apple Spotify and if you want to check out what we're doing at CoachCRM, check us out at coachcrmcom. Thanks everybody, see you next time. Thanks everybody, see you next time.