The Math Every Sales Must Do

As a sales rep you need to deliver closed won deals to meet your quota.  As with all journeys to a goal, there is a hard, rough road and a superhighway, fast and smooth as a baby’s butt.  To earn your commission the most efficient way possible, wouldn’t you want to be on the superhighway? Of course!

The Math Every Sales Rep Must Do

Let me show you how to do some math to start you down your sales superhighway.  The key is to leverage data as much as possible along your journey.  To get started, you’ll need a few data points.  If you don’t have historical trends to use, an estimation is fine.  In fact, you might want to do the math a few times using different number so you understand the impact each variable might have.

Here’s what you need to get started:

  • Monthly, Quarterly, and Annual Quota
  • Average Deal Size
  • Sales Cycle
    • Ideally, Lead Create to Opp Close, but Opp Create to Opp Close can work for expansion reps
  • Win Rate / Close Ratio
    • Both Count of Opps and Value of Opps
  • Lead to Opp Conversion Rate

We will use these metrics and KPIs to calculate a few additional data points.  The first is translate our quota numbers to the number of deals we’ll need to close.  The second is to understand what size pipeline we’ll need to target to hit our number.  Finally, we’ll calculate how many quarters we need to project out and how much pipeline we need.

  1. The Deal Count

The first calculation is quite simple and uses quota and average deal size.  Simply divide the quota for the period by the average deal size and it will tell you how many deals you need to hit your number.  As a best practice, add 1 to the number you get:

(Quota for period / Average Deal Size ) + 1 = number of deals you need to hit your quota

Write these numbers down in a book or journal so you can refer back to them.  You may also want to use an Excel spreadsheet and keep track of the number of deals you need and which accounts will give you those deals.

2. What Size Pipeline Do I Need?

Once we know how many deals we need, we also need to know what size pipeline we need to close those deals.  This is where win rate (also known as Close Ratio) comes in.  You should have two win rate numbers, one based on  COUNT of opportunities and another based on DOLLAR VALUE of opportunities.

Depending on which you want to calculate, use the appropriate set for count of deals and quota.  The math is:

Count of Pipeline Size:  number of deals needed to hit quota +1  / win rate of count

Dollar value of pipeline needed:  quota for period +  Avg Deal Size / win rate of dollar value

Again, write these number down.  This is the size of the pipeline you will need to build to make sure you hit the quota number based on your historical win rate.

3. How Far Do You Plan Ahead?

You may be wondering why we haven’t used Sales Cycle yet.  While we aren’t going to use it in a calculation, we will use to see how far ahead we need to be planning. to hit our number.

Sales cycle can be calculated  a number of ways so be careful and understand what the number you have means.  For instance, many clients I have worked with in the past have used a sales cycle which measures Opportunity close age, i.e. Opp Close Date minus Opp Create Date. This is misleading if your business includes prospecting.  A true sales cycle uses either Lead/Contact create date or Account First Activity Date.    Make sure the number you are using a sales cycle which represents the true time frame you need to work your leads/contacts and close your opportunities.

quota period in days / sales cycle in days

If your sales cycle is 45 days, planning one quarter ahead is sufficient.  But if your sales cycle is 105 days, you must plan two quarters ahead.

It’s a Wrap

With these three pieces of math in mind, you are well on your to establishing the foundation for your superhighway to 100%.  Understanding what it takes to hit your quota number, how long and planning far enough ahead is huge and gives you a head start against your peers.  You may be amazed at how many reps don’t DO THE MATH.

 

An Example of the Quantified Self: Steps

Wearable trackers are all the latest rage!  From a FitBit to a Microsoft Band to old school pedometers, the latest health craze is about steps.   Whether you joined the office fitness challenge or just want to get moving a bit more, the concept of tracking steps is the most popular metric of the quantified self in 2015.   What a perfect metric to start a series of posts showing examples of the quantified self.  The objective is to show the wide variety of metrics an individual can use to make their life healthier, more productive, and happier.

Tracking Activity: Steps

The graphic below is my steps history as recorded using an app called Argus on my iPhone 5S.  The app is simple, turn it on, and it does the rest.  It records steps as you move through the motion sensor.  Of course, the drawback is, it only records steps if the phone is with you and on your body.  For example, if I was on an elliptical, the phone would have to be in my pocket to record the steps, placing it on the machine doesn’t work.

Creating a Custom Quantified Data Visualization

To create the dashboard below, I entered my step data into a Microsoft Excel spreadsheet, added a few formulas for day of week and location and picked a data visualization platform. While I could have created a few charts from a pivot table in Excel, I decided to give Qlik Sense a test drive.  Qlik Sense is a lighter, consumer oriented version of the powerful Qlikview data discovery and reporting platform.  Qlik Sense is easy to use, just select your data source (Excel in my case), select your dimensions and measures and you are off to the races.

quantified self data visualization

Using Qlik Sense to visualize steps data from Argus

Raw Data: Steps by Day

The top graph shows raw steps by calendar date.  While there isn’t too much to see here at first glance, you can see clear dips in the pattern which maybe the weekend.  You can also see the data at the right tend to be a slightly higher than the data to the left side.

Steps by Day of Week

By adding a dimension called “DayName”, we can average steps by day of week.  In the orange chart to the right, the most active day is Monday, followed by Thursday and Sunday.  The lowest is Wednesday.  Fitness improvements come with consistency.  Being the difference between highest and lowest is fairly great, we can focus on being more active on Wednesday’s.  Tracking the change over time will help us be more consistent with our activity.

Steps by Geography

I also added a dimension called “location” by tagging each day with where I was.  I often split time between Washington state and Santa Barbara with days in between flying. The green chart to the left shows a pretty interesting pattern, I am far more active when in Washington state compared to Santa Barbara, This is probably due to the recreational abundance in Washington, such as the hiking trails around Mt. Baker and the walking we do while downtown.  Santa Barbara is also a much more isolated location by comparison.  Perhaps, if I want to be more active, I should stay in Washington state.

The Fundamental, Visual Flaw

You might be asking, what flaw is there is there in the above dashboard?  It is hard to see because it is not there. One of the best CEO’s I ever had the honor of working for said, “if it is important enough to put on a chart, you better damn well have a goal indicator with it.”  I agree.

Throughout this post, I mentioned goals such as covering 10,000 steps in a day, and increasing Wednesday activity.  The charts above should include an indication of these numbers.  The charts are essentially naked without the indicators and the user viewing them loses the context of the rest of the data.

Always include a goal indicator when creating data visuals, the context is essential.

Conclusion

This is one example of using data visualization to improve personal life.  Activity is one of the primary factors in achieving and maintaining good health.  Using a fitness tracker and visualization tool like Qlik Sense can be effective.  Just understand the privacy policy and how the wearable tech company may use your private data.

Triathlon Intelligence: A Calendar View Template For Triathletes

For the past few years, I have been not only training for triathlon, but also talking to fellow triathletes about triathlon performance.  The concept of triathlon intelligence is alive and well in the minds of anyone looking to improve their triathlon finish times.  Not finding much excitement with the training and workout logs on the market, I created TrainingMetrix  (out of business – Oct-2015)to explore the intersection between data and triathlon, as well as data and fitness in general. From usability and access to data to creating KPIs for workouts and nutrition, TrainingMetrix took an open exploration of this often overlooked intersection.

Our latest template, based on feedback from our users, is a modification of our free Triathlon Foundation Template and adds the ability to view both workouts and training plan in a calendar view.  Now, you can see your workouts compared against your plan! This is in addition to the powerful performance dashboard already a part of the free template.  The new Calendar View Template also allows you to build your own training plan.

calendar view triathlon workout and training log

Track progess, merge your plan and workouts into a calendar view, and create/modify your own training plan, the Calendar View Template is a powerful for triathletes

I am excited to show off this latest template.  We are combining a number of KPIs for triathletes into an easy to use template which resides locally on your computer, so your data is private and protected.  Being based in Excel, the template provides a foundation for you to customize and create your own charts and data views.  The power of workout progress and trends come alive.  The ability to create and modify your training plan is another powerful tool.  Lastly, the comparison of training plan to actual workouts is the intelligence the triathlete needs to stay on track, plan ahead and adjust as necessary.  For more information, please visit the Calendar View Template website.

What’s next for TrainingMetrix and I?  A lot, stay tuned, we are just getting started with understanding this intersection, data and triathlon.

Update 10/15 – TrainingMetrix was shut down in October 2015 due to increasing costs and lack of an effective business model.

Anti-Cloud Based Tools for Personal Intelligence

Creating a personal intelligence platform for self tracking has never been easier.  While technology continues to push us toward the “cloud” and SaaS as a strategy of revenue generation, we cannot overlook the tried and true platforms available to keep data on your computer and away from prying eyes of Analysts.

As a data visualization and KPI development guru, I love finding those interesting trends in my own life that drive smarter, better habits.  If you are like me, you don’t feel comfortable sharing your dirty underwear with Mark Zuckerberg and you really wonder what Google is doing with all of that data they keep acquiring.   By maintaining a self database on my desktop computer which I can add to and tweak at a whim, I am able to give myself peace of mind and control over MY data.  Curious, about what KPI’s I track?  Stay tuned, that is a topic of another post.

Without further ado, here are some tools that you can use to create your own personal intelligence platform on your local computer:

  • Microsoft Excel
    • A stunningly powerful tool to use for even the novice user.  Create your own tables, link them how you want and design your own graphs and dashboards at your own pace and complexity.  Available for both Windows and Mac.
  • Numbers
    • A Mac only platform designed to compete directly Microsoft Excel which offers much the same functionality, but lacks some advanced capability compared with Excel.  The simplicity and robust visual que are 2nd to none, but as the data set grows, you may be wishing you chose Excel in the beginning.
  • Qlikview Free
    • I have been a fan of Qlikview for years.  I love the ability to create charts and dashboards from Excel spreadsheets and the gnarly level of interactivity that it provides.  The learning curve isn’t as steep as one might think and well worth a few minutes reading their documentation.   The limitation here is the limited number of shared files you can open.  Windows only.
  • MySQL / Apache / PHP / HTML5 / HighCharts
    • Ok, if you are going with this option, you are a true geek with coding ability.  This isn’t for the lighthearted as configuring MySQL, Apache, etc etc will take time.  But the advantage is you are left with an enterprise class database and a truly blank slate in regards to dashboards.  You can even create your own forms in HTML to add data.  Mac/Linux/Windows
  • Microsoft Access
    • If you need something in between Excel and MySQL to store data, Access is a great option and can interface with Excel graphs and dashboards.  With a mild learning curve, the ability to store any kind of data, and the convenience of a query builder UI, Access makes for a very robust solution. But, it lacks more advanced visualization, so be prepared to connect Excel to Access. Windows only and available with Office Professional.

As you can see, creating a Personal Intelligence platform off the cloud is possible.  You can take full control of your data and keep it private at the same time.  As data becomes more and more of a commodity and SaaS business models continue to nickel and dime everything, home based data management will be more and more appealing.  Excel is the perfect anti-cloud.

Developing KPI’s: Accountability for Remote Workers

While Marissa Mayer’s decision to remove the privilege of remote work from Yahoo!’s culture was met with shock and bewilderment initially, the truth was that Yahoo!’s remote workforce have been slacking.  Since the company is only as good as its best slacker, putting an end to an easy pay check outside the office was the right move.

Since remote work is here to stay, companies need an objective way to monitor their employees.  Just like an employee sitting in office, a remote employee needs to guarantee a certain level of access to their co-workers.  So, how do you know your remote employees are actually working?

As an employee with a few years experience working remote and working with remote bosses, I’d like to discuss some of the data points I think are pertinent to measuring remote employee connectedness and availability.  As a former Citrix Online employee, I am all too familiar with using GoToMyPC and GoToMeeting as tools to enable a positive, productive remote work experience.

Lets take a look at some data points that could give any boss reason to reign in a slacking remote worker:

  • VPN Access – Timed Logged In
    • Most remote employees access company resources through a VPN for security.  Just like Mayer discovered a lack of VPN use at Yahoo!, tracking the amount of time an employee spends on the VPN is essential to understanding their connectedness.  One could also monitor GoToMyPC usage as an alternative to VPN access.
      • While the goal would be agreed upon between employer and employee as some employees may not need to be connected 8 hours a day, the employee should be accountable for at least 90% of the VPN requirement.
  • Phone/Skype Availability – Calls Answered or Callback Time
    • This is simple, if you call the employee, whether via phone or Skype, do they answer?  If they don’t answer, how long does it take for them to call you back?
      • The goal here is to have the employee answer the phone approximately 33% of random calls, with a response time of four hours for messages left.
  • Email Use – Messages Received/Response Time
    • This may or may not be for all employees but since email is taking over for phone calls, remote employees should expect to be in contact with their manager on a routine basis.  The KPI should focus on proactive emails during the period (i.e. did I receive an email from employee) and the response time for emails sent to the employee.
      • Goal is defined as receiving X number of emails from employee with a 24-hour response time for emails sent to the employee.
  • Meeting Attendance – Meetings Attended/Attendance Time
    • Is the employee actually attending team or company meetings?  This KPI tracks their attendance and how long they are connected.  After all, an employee who sits out of team meetings is not likely to be a productive member. Services like GoToMeeting make it easy to know who is connected to a meeting.
      • Goal is to have the employee attend 90% of a meeting’s length and attend 100% of meetings.  Making sure the employee knows to attend a meeting is, of course, the manager’s responsibility.

As you can see, any contact point the employee has with the company can be used to monitor their engagement.  You might be asking yourself how to track these KPI’s and who owns it.  Well, it depends on whether the company has a KPI program or whether a manager is interested in tracking their own team.   In my opinion, whether or not an employee is productive falls squarely on the shoulders of the direct report manager and it would be up to them to create the KPI’s suitable for the situation, leveraging IT and BI departments to access data.

Once a manager begins monitoring remote worker KPI’s, they enable an objective analysis and discussion of expectations between both parties.  Putting the KPI’s onto a shared dashboard is a great way to start off a one on one meeting.

What does an actual dashboard for remote employees look like?  Stay tuned, a mockup is in the works.  In the meantime, what are your thoughts on remote employee KPIs?  leave me a comment or hit me up on Twitter (@mooney1).

Why Hierarchies of Data in a Business Matter

thData, business, sales, insights, and revenue are popular keywords found in abundance around the internet these days.  As a Founder of my own company, I can certainly understand the need to focus on such keywords in daily, weekly, monthly, and quarterly discussions.

But, as a Data Analyst, not all keywords are created equal for each role in the company.  Let’s simplify and break the business hierarchies down to three levels, which have a direct impact on how data can be used:

  1. Executives: The top of the chain that defines long-term strategy, implementation, and overall decision making.
  2. Manager: The mid-level staff responsible for action of strategy, interfacing between the needs to the subordinates and the Executive teams.
  3. Operational: The largest population of the business with the responsibility to make it happen by pushing the buttons, interfacing with customers, and carrying out decisions hour by hour.

This three tier pyramid of decision making in a business is streamlined to illustrate key areas that any serious Data Analyst should have Continue reading

A Citizen’s Role in Politics

The world of politics has been a touchy subject for years.  Everyone has their own opinion on policies and laws that will continue to make this country great!  It is part of our duty as citizens to express our opinions and even act on those opinions as we see fit.  While the most basic action comes in the form of voting, the citizenry is responsible for making an informed decisions on which leaders we elect and which propositions we pass.

This informed decision needs to be based on research, debate, and internal contemplation.  However, the media is usually pretty quick to provide opinions for us that aren’t always in line with reality.  Recently, while having dinner with a friend, I uttered the words “Obama is a socialist,” which then triggered a far greater discussion on exactly what this meant and what actions by Obama support this.  I have to admit that at this time I couldn’t speak to any specific actions.  In fact, I was guilty of regurgitating a line from the media without doing my homework.  This shocked me.

Normally, I am a very well spoken individual who seldom says anything that isn’t founded in concrete.  While I admitted that I was at a loss and we moved on, that voice inside me (the responsible citizen voice) wanted to know if Obama is really a socialist.

The answer is no.  Socialism centers around an economy owned by the state and or geared toward a common ownership.  Of Obama’s policies that I am familiar with, none of them fit into this category.  In fact, after researching this issue, I discovered that Obama is a well respect “centered” politician who has acted for the good of the country, moving between democratic and republican ideals to move this country forward.

What started to truly stir my passion for understanding the situation of our government was a text I received from the same friend containing a link to a rather interesting article.  The commentary article by Spiegel Online titled, “America Has Already Lost Tuesday’s Election, Destroyed by Total Capitalism,” is a rather passionate, European view of what the America has become.

After reading the article, I took a step back.  While I agree that America is controlled more by total capitalist, part of me wanted to believe that even total capitalists wouldn’t act in a way that would jeopardize the future of America.  Then I realized that capitalism is far more about profit than long-term sustainability.

Taking a look at Apple, for instance, who has banked billions and billions of dollars while the American education system experiences a financial crisis is perhaps proof that there could be something to this viewpoint.

In addition, during Hurricane Sandy, hospitals were evacuated because their backup generators failed, yet a few blocks away, buildings beloning to major financial institutions were bright with light and had plenty of power to spare.  The contrast of this image made me slightly angry.

The third piece of information that this citizen gained in recent weeks, is a book by Thomas Mann and Norman Ornstein called “Its Worse Than It Looks.”  I came to find out about this book while driving on the freeway listening to NPR.  What really caught my attention was when the author equated House Republicans to American terrorists.  WHAT!

It seems the Republican party has done more damage to America’s future in the past few years than in the entire history of this country.  The Fiscal Cliff is a product Republican’s willingness to put their party over the good of the country, leveraging filibusters, and refusing to negotiate with the White House.   I couldn’t believe what I was hearing, let alone what I was reading after purchasing the book.

To make sure this wasn’t a Democrat’s way of condemning the Republicans, I did some research of my own and found that the circumstances listed in the book are true.  In fact, I found a fascinating website called “Republicans for Obama” that agrees with a fundamental shift in Republican policy.  Instead of voting for the good of the country, Republicans are now voting to destroy the White House and the President of the United States.

These bits of information have awaken my role of citizen in politics.   While I intend to vote for Democrats going forward to give them back the majority, I will also spread the word regarding the new American terrorists sitting in the House.

What does citizenship have to do with Data, Creativity, Patterns, and Inspiration?  Everything.  Citizens must collect data, understand patterns in politics, and find the inspiration to act creatively to form the future that believe in.

I am sure this post will alienate employers/recruiters (probably won’t be working with Apple anytime soon) and create some controversy within my family.  But, it is my role as Citizen of the United States to research, understand and speak for what I believe in.