In this article Michael Viertler, Senior Partner McKinsey Marketing & Sales will discuss the four ways digital and analytics can drive successful change and the pitfalls to avoid.
Few business leaders would dispute the fact that sales teams must evolve. They are already investing billions of pounds in sales technology and training in response to automation and artificial intelligence, which are making ever deeper inroads into the sales function.
The trouble is that these investments aren’t paying off. In McKinsey’s experience, many sales leaders are frustrated with the lack of clarity on the ROI of their investments and surprised when their new “shiny toys” (such as a new lead-generating tool) fail to deliver meaningful performance improvement.
The truth is that driving sales growth today requires fundamentally different ways of working as well as outstanding execution across large, decentralised sales teams and channel partners. While many sales leaders accept this reality in principle, they don’t put enough energy or focus into pushing that level of change. Advances in digital and analytics, however, mean that sales leaders can now drive and scale meaningful changes that pay off today and tomorrow.
Businesses that get this right typically see 5% – 10% revenue growth with the same or improved margins. And they see many of those benefits quickly, often within a few months. In addition, their longer-term health, as measured by better customer and employee satisfaction, improves.
The four ways digital and analytics drive successful change
Digital and analytics can radically accelerate—and improve the chances of delivering—successful change. But undisciplined investment can be counterproductive and expensive. In our experience, working with companies that have successfully boosted the ROI of their sales investments, these four actions make a meaningful difference:
Provide insights that sales reps need
A wealth of sales insights are discoverable today through advanced analytics, but they often don’t translate into sustainable revenue for a few reasons: the front line does not trust the data; the insights are overly complex; or reps simply feel that their own experience and expertise are being ignored. Successful change programmes rely on a deep understanding of the needs of the salespeople and a willingness to work back from there to deliver insights that actually help reps sell better. The best sales organisations use data to understand the effect of all the steps in sales, from what matters most in driving a sales opportunity forward to where reps struggle or miss opportunities. They then package those insights and send them to sales reps. Actively involving sales reps in the process greatly increases the chances of providing relevant and easy-to-use solutions.
Use digital to enable what matters for each sales rep
We often find companies that have excellent operational discipline often fail to apply a similar rigour to sales. They seem to linger under the misunderstanding that sales is all about relationships or that sales teams are motivated solely by incentives.
The core elements in enabling effective sales operations are focusing reps’ time and attention on the handful of metrics that disproportionately matter. Those often include the size of the pipeline and conversion rate, and incentives that are consistent with the company’s overall vision for its transformation, rather than those based on out-of-date ideas or on criteria beyond the sales rep’s control. Embedding weekly routines and daily expectations of activities reinforce the ultimate goal of driving sales growth. Crucially, then, sales leaders need to focus on digital and analytics capabilities that deliver on these needs.
Use data to prioritise and personalize capability building
Best-in-class sales organisations place an enormous emphasis on building frontline capabilities during a transformation; this applies to their own sales force and channel partners. They recognise that otherwise there is no hope of any new tool or new approach delivering results. But they don’t stop there. These sales leaders use analytics to get very specific on what skills to teach and to whom in order to re-engineer the very DNA of the sales organisation.
By using analytics to identify the traits and skills of top performers, it becomes clear where everyone’s gaps are. Then digital tools can be deployed alongside more traditional learning mechanisms to effectively roll out coaching to large and widely distributed sales forces.
There are times when digital tools have to take a backseat to more traditional training methods. Managers need to devote significant time and attention to teaching reps about the business and imparting critical-thinking skills so reps can understand what the data are showing and tailor it appropriately – not just focus on the tool.
Communicate, communicate, communicate
Sales leaders need to set out bold vision based on where the opportunities for growth lie, but then they need to make that personal for each seller and manager. Advanced analytics can help set granular targets and personalize those targets to each individual region, manager, and seller.
Some of the digital tools that B2C companies use to personalise the customer journey and change consumer behaviour can be used very effectively to communicate changes to each individual in the sales organisation. Specific tools that work well include shared dashboards, visualisations of activity across the team, “gamification” to bolster competition, and online forums where people can easily speak to one another.
Leading companies also make sure they demonstrate progress, using analytics to communicate real-time insights and share early wins. More sophisticated tools can even show individual contributions toward the common goal, which can be very motivating. Overall, this sort of communication makes the change feel more urgent and real, which in turn creates momentum.
Design the solution you need
Digital tools and analytics insights, if correctly applied, offer a powerful way to accelerate and amplify a sales organization’s capacity to grow. However, let’s be clear: the tool should not drive the solution. Each company should have a view of the new behaviour it wants to reinforce and design a practical, integrated approach to leverage digital and analytics.