Measuring the Impact of Sales Training

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1 Measuring the Impact of Sales Training Authors: Barry Hennessy Jon Gooding Page 1

2 Table of Contents Why Measure? 3 What to Measure? 3 Business Impact Considerations 4 Guidelines for Measuring the Impact Of Sales Training 6 Measuring the Business Impact 7 What can be controlled? 7 It s all too much 8 Guidelines for Measuring Learning and Behaviour 9 Measuring the training 10 Measurement alone is not enough 11 Recommended reading List 12 Page 2

3 Why Measure? To develop appropriate training interventions it is imperative that the organisation is clear about what results they require from their investment. Once these are defined it is then necessary to monitor and measure the results to assess success, and to inform actions required to adjust performance. Although the above might appear simple in principle - it is rarely as easy in practice. What to Measure? Most organizations will have a set of metrics already in place to evaluate the effectiveness of the sales process. Example metrics are shown in the diagram below: Results Activities Behaviours Profit Revenue Share Net promoter score Referrals Customer retention Customer satisfaction rating Customer churn Cycle time Cost of sale Repeat business Win rate Customer experience score Sales competency Staff motivation Staff satisfaction Normalised individual performance indicator (NIPI) Using a short set of existing measures that are pertinent and relevant to the objectives of the training, and complementing them with a return on investment (ROI) calculation, is a good practical starting point for assessing the impact of the training on business performance. Many organisations focus upon the business results required alone, in good top down fashion, often leaving a gap at the point of execution. We have found that in execution the first thing to focus upon is the behaviours that correlate to successful selling. Competency frameworks, can be particularly helpful in reminding sales professionals of the behaviours required for success. Effective training, practice, and repetition help to turn the behaviours required for success into habits. Measuring, monitoring and evaluating the behaviours associated with successful selling helps those performing to focus on the areas they have maximum control and influence over. Page 3

4 Encouraging participants to select and apply their skills through the activities most likely to lead to successful results is the next logical step. Focusing on the effectiveness of the sales professionals execution of these activities provides vital feedback to the sales performer. Management support in measuring and using such metrics is often the key ingredient required to sustain success. Business Impact Considerations There are many variables, beyond the control of the sales or training professional, that can affect business results.these can cloud our view of the effectiveness of sales training. Here are a few of the common pitfalls that may be met when looking for evidence of the business impact of sales training: Great training reducing sales Many sales teams are struggling to make the numbers they made last year. It is very easy to understand that today your team could receive great training but if compared to hard measures in previous years e.g. Sales revenue, win rate etc that the impact of the training could be judged a failure just because the market opportunity and buying behaviours have changed. Poor training increasing sales Using recent events to illustrate the point, at the start of the banking crises some markets and organizations experienced significant growth in sales e.g. organizations selling home safes. Sales training provided to such organizations could have been judged a success even if it was poor because external factors meant that as long as the sales professionals could take orders they could succeed. Lack of alignment with strategy Another factor to be considered is the alignment of the training with your business strategy. You might have some excellent product training that improves short term sales in the field. However, if your strategy was to sell services and solutions you may have improved your short term results but delayed or lost the opportunity to deliver the results anticipated from selling solutions and services. Frequency of measurement One of the key factors of sales performance is cycle time - the period between first contact and the point of contract signature. The business impact measurements should take these cycle times - and the time required to refine and apply new methods in the field - into consideration. Page 4

5 Similarly, understanding whether the impact of the training is sustainable or tails off after a period is also important. To really gain an understanding of the impact of the training, we will often have to measure for far longer periods than we initially imagined. Reacting too late If the sales cycle is elongated (as it can be when selling services) there may be a delay in the realisation that the business is being affected. Having early indicators that alert us to these adverse conditions is highly desirable. Variables Sales do not happen in isolation from the outside world - market drivers, customer expectations, and competitive activities all have an impact on results as do internal drivers and activities. Where the internal and external drivers meet the impact can be particularly dramatic e.g. The launch of a new world beating product or service (backed with an outstanding marketing campaign) to a market that is hungry to buy would most likely impact sales results whatever (or despite what) the sales team do. Page 5

6 Guidelines for Measuring the Impact Of Sales Training There are many factors other than those noted above that can influence the measurement of the business impact of sales training. Below are some common sense guidelines for managing the measurement of the business impact of sales training: 1. Get clear about the results you want from the sales training Consider internal and external drivers that need to be addressed over the life of the deployment of the training (customer needs, operational requirements etc) Ensure the training objectives align with your business strategy Forecast the business benefit / improvements expected Identify the results that would show value has been added to the customer, organisation and the team 2. Clarify what you want to achieve from the measurements, who they will be used by and how you want to use them 3. Identify the metrics that will help you assess the impact on business performance Select existing metrics wherever possible Produce a long list of measures that you could use Reduce to a short list (take the minimum number of measurements that will allow you to achieve your objectives) 4. Set up a control group Take measurements before and after the training Decide how long after the training is completed that the measurements should be taken and monitored (take sales cycle time into account) 5. Repeat the measurements to assess on-going impact of the training 6. Periodically evaluate the cost versus the benefit (ROI) 7. Monitor the results 8. Act on the results as and where appropriate Decide if you are satisfied - or not Page 6

7 Measuring the Business Impact i2i strongly recommend that the business impact of sales training be measured. We also believe that, in part because of some of the factors stated above, measuring the business impact alone is flawed and will leave you exposed to the following risks: Untimely performance information: By the time you get meaningful information it may be too late for you to change and adapt development activities. Lack of proof: Measuring sales results does not provide enough proof of the effectiveness of the sales training because of the many potential variables involved. Loss of control and missing improvement opportunities: The measurements of business impact alone do not provide all the required information to assist in controlling, improving, and reinforcing the training. What can be controlled? Sometimes when thinking about measurement we can become lost in the analytics and lose sight of the practical realities. Consider the sales trainers - they cannot control the business impact of the training applied by the participants. They can control their own behaviours and through these behaviours they can influence what the participants may apply. Consider the leaders of the participants - they cannot control the business results of their team members upon return to the field. They can control their own behaviours and influence the performance of their team members through reward (and punishment). They can also influence through their leadership style and skills. Consider the participants themselves - even they cannot control the sales results directly, only the customers can do that. They can however control their own behaviours and influence their colleagues to help them in the sales effort. They can also influence the customers so that they are more likely to buy from them. The reality is that when we are measuring the business impact of sales training the best we can do is to establish some illustrative indicators that demonstrate statistical correlation between the application of the training and the impact on business results. Page 7

8 It s all too much At this point you may be thinking Why bother with the measurement? Why bother with the training itself? To the former, this is just about setting realistic expectations. Perfection is beyond us but establishing useful information that helps us evaluate and manage the effectiveness of training is not. To the latter, consider the impact of having an untrained salesperson interacting regularly with your best customers whilst your competitors provide well trained sales professionals. If you think that time and cost of training is expensive, try ignorance! Page 8

9 Guidelines for Measuring Learning and Behaviour 1. Clarify the changes in behaviour and activity linked to the successful results desired Identify the attitudes, skills, and knowledge that you want developed and applied Validate these against your top performers, establishing the signature behaviours and activities of high performers in your company and markets Use competency frameworks for making the transition AND revised competency frameworks encouraging even higher standards 2. Clarify what you want to achieve from the measurements - who they will be used by and how you want to use them 3. Identify the metrics that will help you assess the impact of the training 4. Set up a control group 5. Take measurements before and after the training Use paper / computer tests to measure the knowledge developed Use performance tests and in field assessment to test for skills Use 360 assessment to get feedback from customers, colleagues, participants, and leaders of the impact of changed approaches Ensure you collect rich evaluation data as well as hard data Identify what else has been learned from application 6. Repeat the measurements to assess ongoing impact of the training and associated support activities Consider using sampling if the burden of measurement is to high 7. Monitor the results 8. Act on the results as and where appropriate Communicate the successes - use case studies and anecdotal evidence to communicate and support development Ensure that the leadership team recognise and encourage the desired activities and behaviours Learn from experience, share what works and recalibrate as things change Use the results to tune the development and reinforcement activities Page 9

10 Measuring the training As well as measuring the effect of the training on the results, performance, activities, and behaviours of the participants, it is also valuable to ensure that measurements are in place to measure the training itself. This allows you to control the resources and time required, improve the training and arrangements, and reinforce key messages. A well-designed feedback form will help you assess the impact the training has on the participants. (i2i has template evaluation sheets for this purpose if required). The muchmaligned happy sheets, if well designed, will help you assess the impact of the training and the likelihood of participants transferring the learning into the workplace. It is reasonable to assume that if the training is well received by the participants and the indications are that they are inspired to use the learning(s) there is a better chance of them using the methods in the workplace. When using evaluation sheets: Ensure you are clear what you want from them Provide well designed forms Encourage written responses immediately at the end of the session Ensure 100% response from all participants Ensure honest responses Develop acceptable performance standards from the results to be followed by the trainers Measure, evaluate and react to ratings and comments Communicate the reaction Using common sense and good judgement both in the design and use of measurements of the sales training will enable you to optimise the return from your development activities. Measurement does require careful thought, planning, good judgement, and disciplined execution. It also requires that the measurement approach be appropriate to your needs and resources. Measurements that are too complex will undermine the benefits that you aim to achieve. Too little measurement risks the frustration of not being confident about whether the training has worked or not. With careful thought you can ensure that your measurement approach helps you prove, control, improve, and reinforce the training. This will put you in the ideal position of being able to learn, change, and improve the results you attain as you progress. Page 10

11 Measurement alone is not enough Measurement itself does not deliver the business results and improvements we desire - and too much measurement can take focus away from the end goals. Other factors to consider: To increase the chances of getting the best results from your sales training you should ensure: You select the right training company who have proven experience and skills in the type of selling and training you require The change is well managed. To be effective sales training requires change. As with any other change ensuring the right planning, change control, and support systems are in place significantly improves the chances and degree of success The training fits your organization and strategy. Training does not happen in isolation - ensure the training is customised to your environment and aligns with your business plans and strategy You support your leaders in helping the participants deploy their improved skills. Key to successful deployment will be the behaviours of the sales leaders and managers. Support them by ensuring they know what are the skills, behaviours, and activities to encourage and reward. Support them in the development of the appropriate leadership skills required for them to encourage improved sales performance from their team That the sales climate encourages the results, activities, and behaviours required for success. At i2i we have the skill and experience to make sure that your sales performance developments are joined up, ensuring you get better results faster with lower risk. Page 11

12 Recommended reading List KIRKPATRICK, D.L. (1998). Evaluating Training Programmes the four levels ALLIGER, G. and JANAK, E. (1989) Kirkpatrick s levels of training criteria: thirty years later. Personnel Psychology. Vol 42, No 2. pp THE INDUSTRIAL SOCIETY. (2000) Training evaluation. Managing Best Practice Series. No 70. London: Industrial Society. The AMERICAN SOCIETY FOR TRAINING AND DEVLOPMENT Annual surveys. MATHIEU, J. and LEONARD, R. (1987) Applying utility concepts to a training program in supervisory skills: a time-based approach. Journal of Academic Management. Vol 30, No 2. pp MORROW, C., JARRET, Q. and RUPINSKI, M. (1997). An investigation of the effect and economic utility of corporate-wide training. Personnel Psychology, Vol 50, No 1. pp GUZZO, R. and GANNET, B. (1989) The nature of facilitators and inhibitors of effective task performance. In: SCHOORMAN, F. and SCHNEIDER, B. Facilitating work effectiveness. Lexington: Lexington Books. EASTERBY-SMITH, M. (1994) Evaluating management development, training and education. Aldershot: Gower. LATHAM, G. and SAARI, L. (1979) The application of social learning theory to training supervisors through behavioural modelling. Journal of Applied Psychology. Vol 64. pp SILVESTER, J., ANDERSON, N. and PATTERSON, F. (1999). Organisational culture change: an inter-group attributional analysis. Journal of Occupational and Organisational Psychology. Vol 72, No 1. pp PHILLIPS, P.S. (2006). What value does coaching add to talent management programmes? Selection and Development Review. Vol 22, No 5. pp5-8 Control Groups In the recommendations we do advise where possible to use control groups. We recognise from experience that for this to be successful the size of the control group has to be adequate. We also recognise that due to the competitive nature of sales professionals and the integrated nature of organizations and communication that leakage of new practices and approaches to sales as a result of training to the control groups is almost impossible to prevent. Page 12

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