The Metrics Pollution Problem

Managing a growing business, requires intelligence about various performance metrics, or in other words “knowing your numbers”. The best metrics are created with a specific business intelligence need in mind, and don’t get polluted with other needs as a company evolves.

Enter the “Active Selling” Metric

Several years ago I was engaged with a large technology company. The company’s sales team included a group of Account Managers – sales employees focused on growing sales within existing customers.

Each Account Manager was assigned a number of customers. Success was measured by overall revenue growth for all customers assigned to the Account Manager. While revenue growth was the main focus, they were also evaluated by selling motions (calls made, meetings held, etc.). If revenue growth hit targets, management was happy. If not, these salespeople were placed on a performance improvement plan.

During one of my sessions with a sales manager, I recognized a need for a new metric – the ability to measure the number of customers that Account Managers were actually engaging with. Picture this. If an Account Manager was assigned a base of 50 customers, and was actively working with 12 of these customers to hit their sales targets, management was satisfied. But what about the other 38? What about missed business conversations and growth opportunities with the other 38 neglected customers?

Using Salesforce, I created a new metric called “Active Selling” to help. The metric evaluated things such as:

• Accounts with won opportunity in the last (# of months) -OR- open opportunity
• Accounts with certain types of tasks/events within the last (# of months)

Either the account had Active Selling – or it did not. Simple, effective, insightful.

It was now possible to look at customers assigned to each Account Manager, and quickly see which ones were being “worked”, and which ones neglected. Equally important, this metric was visible to all employees at the company. Account Managers could use it to re-focus efforts when they were at-risk of not hitting performance targets. Management could now see customers that were falling between the cracks and potentially reassign them to other resources.

The new Active Selling metric spread like wildfire at the company. Management now had a new informational lever to steer business and coach sales reps. Active Selling was used in internal meetings and coaching sessions. Even senior management had started talking about Active Selling in company-wide calls.

All was going well, but then came requests to change the Active Selling field logic. At first, change requests were organic and demonstrated organizational maturity – tweaks to the date range, limits to task type, etc. Then, requests took another turn – asking for other evaluations to be added to the field logic that had nothing to do with Account Managers.

The Active Selling field became very popular, and many started looking at it as the “Swiss army knife” metric for all stakeholders. Adding layers of logic, polluted the metric from its original purpose. It was becoming less useful for measuring Account Manager performance, and never truly addressed the newly-requested needs either. In trying to make the field meet everyone's needs,it actually met none of them.

Don’t Forget the Opportunity “Stage” Field

Another example of metric pollution is the opportunity “stage” field. For those unfamiliar with Salesforce, the opportunity stage is a standard drop-down field on opportunity records, with a list of values to identify the current sales effort with the customer. Best practice is to have a different stage value for each element of an organization’s sales process.

I usually like to advise companies to make sure that each opportunity stage represents a change in the likelihood of winning a deal as well. If the sales motion doesn’t increase the probability of winning a deal, it usually should not be included as a stage. This preserves the opportunity stage field as a clear metric that can be used to accurately forecast business over the long-haul.

In Salesforce, the opportunity stage field is often located at the top of the page in a clearly-displayed graphical Salesforce Path. As well, it is one of the most-used fields in reporting in a typical Salesforce Sales Cloud implementation. Stage is prevalent and visible, and this makes it an easy target for metrics pollution.

When finance, post-sales provisioning, or professional services teams need a way to track their processes on an opportunity in Salesforce, sometimes the stage field is used as a one-size-fits-all solution to track their processes too. These group processes may run parallel to the sales process, but don't always affect the probability of winning a deal. When this happens, the stage field doesn’t work as well for forecasting and pipeline management – and often it doesn’t work well for the other non-sales groups either, polluting it for everyone.

Conclusion

The best business metrics are simple, focused, and clear in purpose. When creating a new field for a key metric in Salesforce, take a little time to carefully plan the purpose of the field to avoid future metric pollution. Extending new logic to an existing metric, may seem like a quick way to adjust an existing field to get new insight – but it rarely works.

A Few Tips for Keeping Your Metrics Clean

• Consider the action-ability of each new business metric, to better steer metric definition. (e.g. When metric field = value x, what action would or should be taken?)
• Document the metric’s purpose in the Salesforce field description. This will help ensure the field’s value is preserved as business evolves.
• Before changing a metric field’s logic, carefully consider the purpose – and make sure change is consistent with the purpose. Otherwise, create a new field.
• Keep opportunity stage values aligned with probability-impacting sales processes, and nothing else.
• Use separate fields to track other non-probability impacting processes on opportunities.
• Don’t be afraid to create new fields to measure new things.

About Guide Paddle

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