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Accountability and Leading Indicators (A Note to the Sales Manager)

In management, we prefer to evaluate performance based on factual, concrete results. Everything that can be captured and reported is, and the data provides an endless array of metrics for management to pour over, review, and assess. Most of the metrics are an autopsy; they are lagging indicators about which absolutely nothing whatsoever may be done.

Good managers and leaders hold their salespeople accountable for results (Great salespeople hold themselves accountable). The best managers and leaders know that it is unfair to hold people accountable for the indicators that prove that the salesperson has failed without first holding them accountable for producing the results that are captured by leading indicators.

Warning Lights

It isn’t right or fair to allow people that you have hired to fail. As a leader, you have to make sure that they are given every opportunity to succeed, including the investments of your time, the training they need to succeed, the technologies that help them to be effective, and coaching.

A big part of effectively holding people accountable for results that show up as lagging indicators requires that you first hold them accountable for the activities that show up as leading indicators.

As a manager or a leader, it is unfair to hold people accountable for results they should have produced only after the fact. The lagging indicators that report that the salesperson has missed their number means that something went wrong. Maybe the salesperson generated too little activity to make their number. Maybe they spent too much time on activities that had no chance of producing the result that they needed. Or maybe they need more help to be effective.

Once the number has been missed, there is no way to go back and make any improvements. It’s an autopsy.

The salesperson isn’t the only one that missed their number. As a sales manager, your number is made up of your salespeople’s numbers.

Leading indicators are the warning lights that something isn’t working or something has gone wrong. This is one of the great values of activity metrics for sales managers: the warning lights allow you the opportunity to intervene before it is too late.

Accountability All Along the Way

No one is surprised to have missed their number. They shouldn’t be surprised by their manager’s response. They shouldn’t be surprised to be put on a performance improvement plan, or to be required to take other actions to improve their results. If they need to be moved into another role or another position, the conversation needs to be held long after they were made aware of their performance issue. Hence, warning lights, a chance to improve, and help all along the way. Accountability shouldn’t be a surprise.

It is easier to hold people accountable all along the way. If they are accountable for generating the activities that show up as leading indicator—as well as the activity that shows up as lagging indicators—they know where they are and how they are performing.

The warning lights aren’t only for sales managers, either. The salesperson can also measure themselves against the leading indicators, such as scheduled appointments, face-to-face sales calls, opportunities in their pipeline, and the movement of their opportunities from one stage to the next.

Questions

Which indicators do you spend more time with, leading indicators or lagging indicators?

Do most of the reports you receive and use contain leading indicators or lagging indicators?

What are the most important leading indicators that you measure and monitor?

How do you use leading indicators to help improve your own performance or your team’s performance?


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Comments

comments

  • http://twitter.com/suchimishra Suchitra Mishra

    Hello Anthony,

    An eye-opener of an article – thanks. I agree that most metrics I work with are an autopsy.
    Probably because we track what we are tracked on – Boards track companies on
    revenue and profits, companies too hence track their people on the same or at
    least give the most importance on performance on these metrics. 

    But as you rightly said so in a previous article – “The biggest
    challenge isn’t closing. The biggest challenge is opening.” We
    tend to focus on our closing numbers so much that we lose sight of the openings
    that lead to these closings and often times realise this too late.
    With the downturn though, I do see a shift in the perspective. The focus is shifting slowly on  metrics like funnel building : opportunities created/leads generated, Customer centricity : net promoter scores/engagement breadth through new vs. repeat business, etc. 
    Thanks again,
    Suchitra
    twitter : @suchimishra

  • Richard Ruff

    Anthony

    Nice article – I fear too few tend to make the distinction between types of inducators so it is an important point. 

    As to leading indicators – the one that I have seen folks use most effectively is: Percent of time spent in-front of customers.  The bad news is when you actually measure this the percentage is a lot lower than most think.  The good news if you increase it, than positive results almost always happen.

    dick ruff