I’ll be the first to say that becoming a data-driven organization is not easy—but in today’s increasingly competitive world, it has become a necessity. I will also readily admit that it can be difficult to identify what it means to be data-driven and how to evaluate the benefits of a data-driven approach.
According to Harvard Business Review, ‘“becoming “data-driven” has been a commonly professed objective for many firms over the past decade or so. Whether their larger goal is to achieve digital transformation, “compete on analytics,” or become “AI-first,” embracing and successfully managing data in all its forms is an essential prerequisite”.’
Unfortunately, HBR also found that many of today’s companies are struggling to execute on data-related initiatives and 72% of companies have yet to create a data-driven culture at all. Having the honor to work with some of the world’s leading data-driven companies, we at Xactly know this puts other businesses at a huge disadvantage.
When our CEO, Chris Cabrera, founded Xactly in 2005, he knew that data was crucial to driving performance and growth. As a result, over the last 15 years, Xactly has partnered with its customers to build the world’s only comprehensive empirical data set on sales performance. We now deliver value to our customers from this data set through a variety of offerings including Xactly Insights. However, although this critical data is readily available, not everyone has bought into its importance yet. Frankly, it is disappointing that 53% of businesses are still failing to see the value of data and are not treating it as a business asset.
We are at a turning point in the business world. There is increasing impatience for sales leaders that cannot drive results. We see this in the fact that the average tenure for a VP of Sales is 19 months and decreasing. The key ask of sales leaders today is to guide their organizations by making data-driven decisions and to eliminate the mistakes that result from making decisions on gut instinct. Through our work with thousands of customers, we have identified three key challenges to building a data-driven sales organization.
The 3 Biggest Challenges & How to Overcome Them
1. Insufficient Organizational Alignment
The Problem: Lack of communication and reliable business information
Do you know if your senior leadership team is on the same page? Do all of your executives know the key strategic goals the company is going after for the coming year? These seem like obvious questions but you would be surprised how often we speak with companies where this is not the case.
A lack of communication can lead to insufficient organizational alignment—when this happens, people begin to operate in silos and everyone has access to incomplete information. The end result is that no one has an understanding of the big picture or how all of the pieces of the puzzle fit together. When you combine this with conflicting priorities, you create an environment where the business decisions being made are misaligned and based on partial or nonexistent data. Ultimately, this negatively impacts your entire company’s ability to hit corporate goals.
The Solution: Communication and Data Availability for Senior Leadership
Key Consideration: Do you have the right people in your meetings?
It’s important to include the key players in your business decision conversations. That ensures leadership is on the same page when it comes to goals. Then, together, they can use actionable data insights to drive aligned, strategic decision making.
2. Internal Resistance
The Problem: “What we’re doing is working fine.”
Companies can easily fall into the “it’s what we’ve always done and it works” mindset. Unfortunately, this approach limits you. Your current strategy might work, but what if it could be better? We tend to trust our gut in sales planning, but sometimes we miss the mark. Without a data-driven approach, we might not know it until it’s too late, which is when we’ve missed revenue numbers or other major milestones.
In fact, my colleague, Xactly Chief Sales Officer, Marc Gemassmer, says it best,
“In all honesty, the biggest ah-ha moment I’ve ever had in my career was my first planning season with Xactly when I finally gained access to industry data...without data, you’re just scrambling for answers. When you have this kind of access to the information you are granted the ability to make high-level decisions made from the numbers, which you can then use to optimize every part of your sales plan.”
The Solution: “What we’re doing is working but it could be better.”
Key Consideration: Have you teamed up with innovative people at your organization who are willing to push the status quo?
As a data-driven company, it’s more than just organizing your data. It’s taking it and turning it into actionable insights that help you gain deeper visibility into performance and information to optimize your sales planning. Ultimately, you have to invest in making your data useful so that you can make strategic decisions and drive better performance in the future.
3. Lack of Adoption and Processes
The Problem: Keeping the hype after adopting new technology
Getting buy-in for new technology, processes, or any transformation within an organization is never easy, and resistance is always part of the process when implementing change. The biggest challenge with adopting anything new is that the excitement of a new tool dies shortly after it’s implemented. Why? Our day-to-day activities take over and we don’t dedicate the time and make it a priority for everyone to truly learn how to use the new tools to their fullest capabilities.
Then, when it comes time to assess whether or not the technology and processes have been impactful, we see poor results. When in reality, additional investment in time and learning would have dramatically improved the results.
The Solution: Gather a team of champions to drive the project
Questions to ask: Have we taken the proper amount of time for implementing process and training to see a real impact?
The problem with a lack of adoption and processes stems from a lack of organizational investment pre and post-implementation. Rather than having one individual owning the new technology or process, you need a team of champions. A group will help reinforce and hold the larger group responsible for taking the necessary steps to get the most out of newly adopted technologies.
The champion group should also ensure that the right people are involved at the right stages. That means providing adequate training for the entire team and specific training for individuals that will live and breathe the new tools in their everyday lives, as well as creating documentation of processes.
Start Your Data-driven Sales Journey Today
Companies that fail to embrace data are being left behind and are unfortunately setting themselves up for failure. We see this in the work we do every day with our customers. For companies that have yet to start on their journey to becoming data-driven, you need to get started ASAP.
Luckily, tools like a sales performance management (SPM) platform are designed to help businesses become data-driven. And while it’s not an overnight process, it’s worth the journey. In fact, you can begin today by taking this quick 60-sec assessment to see where you stand and what steps you can take today to get started.