Xactly Corp. recently sat down with Jason Jordan, partner at the sales management development firm Vantage Point Performance and lecturer at University of Virginia’s Darden School of Business. The topic? Jordan’s new book, co-written with sales coach Michelle Vazzana. We wanted to know what “Cracking the Sales Management Code” was all about. Check back in this space over the next three Wednesdays for excerpts from the book. Want to see more right now? Xactly: Why did you and Michelle Vazzana decide to write this book now? Jason Jordan: With the advent of CRM people can access to all sorts of data about sales and sales people. Management is swimming in data. But do they know what to do with it? How much of it do they need? We wanted to cut through the noise and find out what is useful. Xactly: So, what is useful? Well, that’s a funny thing. The no. 1 metric tracked by every company is revenue. But the reality is that you can’t manage revenue. And revenue is a little bit of lagging indicator. We think managers should focus on the sales activities that lead to revenue. Making calls, managing activities and the pipeline, those are things that sales managers can control. Xactly: What did managing revenue look like? The most classic example is that the sales manager sits down with the sales reps and basically what comes out is “you have to work harder on making your number.” But you can’t work harder to make revenue. You have to work smarter. You have to target activities. But to some extent those aren’t tracked by CRM systems. Those have to be inputted by a person. Only 17 percent of companies track this data. It’s an interesting supply problem. There is all of this data but how much of it is letting companies track the activities that can actually be managed? Xactly: What does managing activities look like? You have to reverse engineer success. Start with the outcome you want and work your way back into that number. A new sales rep is new to the territory. He has to do a ton of prospecting. The activity that you are going to target is going after the right prospects. That is how you get to increased revenue for that rep. A rep that has been in a territory for 15 years should have growth come from his existing accounts. He should be managed to grow those and look for new opportunities there. Managing someone who has major accounts is different than managing someone who has lots of accounts in a large territory. It’s different. And, because of that, generic coaching won’t work. Different metrics are right for different sales reps. Most training that is given to sales managers is very generic coaching training: How to set goals, a career development management course. But that’s not what they need. The training we try to provide is training sales managers can use Monday morning. You have to reverse engineer on Monday morning what you would like to have happen on Thursday. Take for example this piece of research that I really love. One of the most motivating things to a sales rep isn’t the most obvious suspects. It’s clarity of task. This is how a manager can help a rep succeed. People don’t want to be told what to do, but they want to know what to do. Managers must help them think through what you have to do to get where you want to go. This is coaching. This is hard. Reverse engineering is all about those value-added conversations. It provides tools to make that conversation more useful. Xactly: How do you reward activity? In many ways, clarity of task is its own reward. Ultimately, the reward for doing the activity comes from hitting quota. We raise the importance of managing – of sales managers on the ground having conversations with reps – to be on par with the incentive plan. Both of these things are needed to succeed. It links that training, coaching and development to results. Back into the activities you need to achieve your goals. Sure I am going to pay people in revenue. But a lot of people pay based on objectives. A lot of companies have complicated objectives. But some people are starting to reward for activities. Sometimes I ask business leaders “do you compensate for activities?” They say no. They ask how can they know that activities will lead to increased sales. I wonder why they are telling their sales reps to do anything if they have such little confidence in the results. You have to understand what activities will get which results and you have to manage for those activities. Why doesn’t this reverse engineering of sales and other projects happen more? It’s kind of an ah-ha moment . It is obvious to people that they should have been doing something different. But it wasn’t obvious at the time. Anytime people can sit down and think in a structured way about how they can get where they want to go it is useful. The whole point is to put thought into it and come up with a plan of action. There is guidance in the book , for example, on how to pick the right tools. For example, people say that they want to be healthier. But what does that mean? Lose fat? Gain lean muscle? Once you know what it is you want, it is a lot easier to pick the activities you need to do to get there. Where do you want to go? What is the best path to get there? What do you need to do Monday morning to get there Friday afternoon? It took us three years of research to get to the right sales activities. When we started doing this in 2008, we thought it would be a best practices survey. We looked at companies that have had CRM for a very long time. We thought we would find a best practice. But we didn’t. That forced us to sit down with a piece of paper and come up with research around how to best get the results most companies want – and managing activities turned out to be the answer.