Time Is Money: Why You Need to Measure Hours and Outcomes
Most salespeople and managers tend to measure their performance and success based on a single metric: sales. And for the most part, this is a solid strategy; by focusing on the bottom-line results, you can eliminate secondary variables that may or may not influence your bottom line. For example, it might not matter that your top salesman is chronically late if he’s still finalizing the largest dollar amount of sales for your organization.
But if you’re interested in maximizing the ROI of your sales team—in other words, improving your bottom-line numbers for each dollar you spend in salary and benefits—you’ll need to delve a little deeper, and start measuring the hours you and your team are spending.
All Time Is Not Created Equal
The underlying philosophy for this approach is that all time is not created equal—yet there’s a finite number of hours in a workweek, and you’ll likely pay your team members the same amount (excluding commissions) regardless of how they spend those hours.
An hour spent wooing and finalizing a lucrative client, for example, is more valuable than an hour spent in a meeting about a topic unrelated to sales. Learning how to monitor, understand, and maximize the allocation of these hours is one of your best tools for success.
So how can you tell which hours spent are most valuable for your team? Generally, it will fall into one of three categories:
- Direct revenue generation. These are activities that play a role in directly acquiring new revenue for your business, such as attending sales calls or finalizing paperwork for a deal.
- Groundwork for revenue generation. These are tasks that play a role in providing a foundation for revenue generation, or preserving revenue generation. For example, you might work on putting together sales collateral or a sales proposal, or may make a call to a client to preserve your relationship with them.
- Personal development. Any time your employees spend on improving their skills, knowledge, or experience will likely pay off in the long run—even if they don’t directly lead to additional revenue.
Common Areas of Time Waste
So where is time usually wasted? By this, we aren’t talking about obvious forms of time waste, like playing around on social media or napping during work hours. Instead, these are areas where “legitimate” working hours are spent on less valuable tasks:
- Email is a necessary communication medium that, at its best can save time and improve your efficiency. But at its worst, email can be a source of massive time waste, thanks to miscommunications, excessive time expenditure, cluttered inboxes, and unimportant threads.
- Data entry and admin tasks. Though most sales teams need to spend some time recording data in CRM platforms, for the most part, this time won’t help you generate any revenue.
- Meetings and office work. Unless the meeting is directly related to improving sales skills or your team’s approach, any meeting that includes your salespeople will keep them from meeting with clients and landing deals. Regular office work, too, detracts from this cause.
Motivation for Time Waste
Understanding the main areas of time waste is only half the battle. You’ll also need to understand the main potential motivations for that time waste if you want to succeed in eliminating the problem. These are the common underlying causes:
- Organizational and role discrepancies. Part of the problem is that your sales team may be responsible for tasks that are usually handled by other roles, such as customer service, office management, or data entry specialists. You can resolve this problem by rebalancing work responsibilities or hiring independent contractors who can work for less money to complete these tasks.
- Unclear objectives. Your sales team should understand that their main objective is to bring in more revenue. If they have an inaccurate perception of their role or objectives, they may mismanage their time or spend it on secondary or tertiary tasks.
- Redundancy and unnecessary manual work. Your sales team might also be wrapped up in group projects, meetings, or responsibilities that aren’t strictly necessary. For example, they may be included on meeting invites because it’s become a habit, or may record data that isn’t necessary for the organization.
- Apathy or lack of focus. More rarely, your sales team may be spending time on unnecessary projects because they don’t care about the organization or aren’t passionate about their line of work.
Adam Honig, the co-founder and CEO of Spiro, an AI-driven sales CRM, says that wasting sales reps’ time can result in distractions and dampened morale. “If a sales rep has a possible lead from a business card they got at a networking party, chances are they’ll just shoot off a quick email before entering the contact’s information into your CRM,” he says. “They probably do this for two reasons: they’re not sure if this is a worthy prospect to be part of your database and they’re lazy. Entering new contacts takes valuable, valuable time.”
Once you start monitoring your team’s hours, and understanding how they affect your bottom line, you’ll be able to optimize your roles, workflow, and underlying philosophy to increase your overall sales.
It won’t happen all at once, but opening the door to this realm of employee analytics is the first step toward a more efficient, productive path.