Growth Factorials

Once during my tenure leading a P&L role, our sales team operated under a clear sales process. We had set specific goals, including activity-based milestones (like the number of meetings and proposals) and outcome-based goals (number of units sold and revenue generated), rooted in our experience with the sales funnel, cycle time, and conversion ratios.

In the initial months, everything seemed promising. Some team members excelled in the activity-based milestones, raising expectations that they would surpass their targets. However, when the year ended, none of the top five in the activity-based leaderboard made it to the final revenue-based leaderboard. Only two out of the top five sales performers, based on revenue, had completed their activity-based targets. Yet, all five of them had overachieved their revenue targets.

So, what went awry? How do we interpret this data? Should we reconsider activity-based targets for our success? But then, how do we ensure the team focuses on controllable inputs when outcomes are not always in our control? Initially confused, I questioned whether input-based milestones for startup teams were the way to go.

Upon deep data analysis and reflection, I identified three types of team members:

1. Disciplined and Process-Oriented Individuals: Those who followed the prescribed process and input activity-based milestones. They tracked progress, made course corrections, and improved over time, achieving both their activity goals and final revenue goals.
2. Disciplined but Goal-Unfocused Individuals: Some team members overachieved their activity-based milestones but failed to understand the real process and skills needed to achieve final goals. They got their priorities wrong, overachieving in activity but falling short in revenue.
3. Hungry, Skilled, and Outcome-Focused Individuals: These team members had their eyes on the final prize and defined their own processes. They were not bound by the prescribed path, spending time where it mattered most. They didn’t meet activity-based targets but exceeded revenue goals.

There are multiple paths to success. A defined process is meant for disciplined team members willing to put in the effort. However, it may not cover all nuances, leading to leaks in the process when followed mechanically. The masters of the game, the hungry and resourceful individuals, often create their own paths, adding nuances that the process misses.

The defined process works for 60-70% of the team members, but not for the 15-20% who don’t learn, don’t think beyond instructions, and lack their own insights. They need close monitoring and support, and may be better suited for roles that match their skill levels.

Top performers (10%) should not be forced into the defined process; instead, they should be given the freedom to follow their own path while still being monitored for quality. Learn from them, and continually improve the process based on their insights.

In the end, it’s the win that matters, not strict adherence to the defined process. The process will evolve as you learn more, with the goal of enabling more team members to become winners. Keep your eyes on the final prize, always looking for ways to improve and support your startup.

PS: Using unethical means for delivering results are not endorsed; there should be zero tolerance for such behaviour.