Kunal Pandya, the Founder & CEO of Sales Velocity Labs, helps SaaS companies increase revenue through ROI-centric revenue performance optimization strategies.
He is also a founding member of the Sales Enablement Collective and the VP of Global Revenue Enablement at Corsearch. With over 20 years of experience in global operations, enablement, and management consulting, Kunal has a distinct perspective on the role of the enablement function.
In this interview, Kunal talks about moving beyond enablement, the metrics to measure the ROI of enablement, and how to get buy-in from frontline managers and reps through communication and empathy.
(This conversation has been edited for length and clarity.)
Elevating the role of enablement in today’s economy
One of the critical challenges when it comes to the enablement function today is its ability to demonstrate or prove revenue impact. When the enablement function can’t do that, either due to the lack of means or agreement, they're seen as cost centers.
We can all ‘say’ how critical enablement is to a company, but how do you prove that? Well, here’s how:
Demonstrate revenue impact
Suppose the CFO asks, ‘Are you defining the x million dollars from your budget?’ This is crucial because the CRO or the chief sales officer would not touch the credit carriers. The next automatic question is, “What about the enablement team? What are they doing?”
While enablement is handling the training, onboarding, content creation, and more, what's their revenue impact? Polls on people's confidence in demonstrating the revenue impact of enablement aren’t as favorable as you’d think. Nearly 60 percent don't have the confidence to demonstrate revenue impact. When that happens, enablement is in the firing line.
The first way to elevate enablement is by demonstrating revenue impact. While that is easy to say, it isn’t easy to do. It requires a combination of art, science, and communication techniques.
Speak the language of the C-suite
Marketing, sales, and other departments are constantly vying for attribution to revenue. Contribution comes in from all sides, from the lead who bought the event to the sales teams and the teams who ran the product demos to the teams delivering the release and others developing new product features. Sales will always get the credit from an attribution perspective, regardless of how much they did, and earn a commission.
While this attribution discussion has been happening for a long time, it is time that enablement is part of the conversation.
Measuring ROI of enablement
There are two categories of critical metrics to understand. The first set of metrics is fixed and tangible, while the latter is dynamic and based on what enablement is trying to accomplish. However, discussions on enablement metrics are something that enablers have been sitting out of for years.
Regardless of the organization, the industry, the type and size of the company, and the products you sell, the number one metric will always be revenue. Any definition of enablement that doesn't contain the word revenue impact is not quite right.
However, the problem is that enablement does not directly impact revenue. Several barriers, variables, and parameters can impact revenue that is not under enablement or even within enablement’s span of influence. Let’s focus on revenue and, more specifically, Revenue Forecast—the trajectory of where we are heading versus where we need to be.
Usually, there's a gap between the company’s revenue goal and where the company is heading now. Revenue gap is another valuable metric. While it depends on the kind of industry you're in and the go-to-market strategy you're pursuing, four factors impact the revenue gap at the top line. These four factors are essentially the levers of sales velocity. These include the following:
- The number of opportunities created in the pipeline at a given time
- The average win rates
- The average value of those opportunities won
- The average length of the sales cycle
While these levers are interesting individually, they're also part of a larger equation known as sales velocity.
What's the average deal value? What's the win rate? How long does it take us to do it? When seen separately, these questions and metrics give us just numbers. When taken together, trends emerge that form the larger story.
What is the trend when it comes to win rates? How is a specific rep trending when it comes to sales cycles? Chief Revenue Officers doing this see that the pipeline is stable right now; rarely is it shooting up. The average deal value is increasing slightly, mainly because prices are rising. So, everyone has to increase pricing. That said, win rates are either stable or slightly declining, and sales cycles increase every time.
From a trend perspective, if companies do nothing about these metrics, there might be a few extra deals in the pipeline, but will that pipeline be enough? The deal value going up will help, but that might also impact the win rate, which is in decline. At the same time, the length of the sales cycle is increasing.
If companies did nothing at this point, they would hit a barrier regarding their ability to scale and grow. The company’s revenue will eventually start to decline. This justifies:
- Why do you need to do something?
- How badly do you need to do it?
- When do you need to do it?
- What do you need to do?
In terms of key metrics, you need to begin looking at the factors that influence those four levers of sales velocity. This includes top-of-the-funnel metrics such as the number of
- Opportunities created
- Outbound messages sent
- Calls being made
How many of the above got a response? Of those responses, how many convert into a meeting? The following are some of the pertinent metrics I typically consider. There are also some relevant metrics around the sales cycle. Opportunity conversion rate, for instance. Stage by stage in the sales cycle, here are some of the questions you need to ask:
- What is the conversation rate?
- Where do things dip?
- Where do we lose deals?
- Why do we lose deals?
- How long does it take for the reps to go through each stage?
- Where does it take the longest? Why is that?
Numerous metrics can help, some of which will be similar across companies. However, enablement can't directly impact revenue through these metrics. The next layer of metrics—leading indicators of revenue are metrics that enablement can influence. These typically include competencies, behaviors, processes, engagement, and maybe metrics on the tech side. While there might be other aspects that enablement can control, attributes like competencies, behaviors, etc., are flexible and dynamic because they depend on what we are doing and work well as leading indicators.
Let’s consider a company that needed to solve building business cases for their reps. There's a direct correlation to win rates. For instance, those reps who made compelling business cases had a higher win rate than those who didn’t. If you want to impact the win rate or impact stage conversion at that business stage, the competency you would need to focus on is the ability to build compelling business cases.
If this specific ability to build robust business cases could be measured as a skill, behavior, and leading indicator, how many deals is it impacting? Over a particular value, there will be a business case. If we can show impact, then that's something that enablement can do. A rep may choose not to do it. But if enablement can impact and influence this, that's one way of correlating to revenue impact. Ultimately, we're seeing the right opportunities by developing more business cases.
- Does that have an impact on that division?
- Does that have an impact on the cost savings?
- Does that have an impact on win rates?
- Does that impact revenue?
The last metric is value setting as the enablement program. This is the Simon Sinek Golden Circle.
This starts with a ‘why’, going up to the ‘how,’ and ending with a ‘what.’ The ‘why’ here is revenue and sales velocity. The ‘how’ corresponds to the conversion rates and the competency of the leading indicators, while the ‘what’ is the revenue of the enablement program.
The problem that many enablers have today is that they start with the what, which translates to, “We are going to do some negotiation training.”
Why? Because that's what we've been asked to do. They may not get into the ‘why’ part of it too deeply. They might not have to do the ‘how’ because they will transfer the knowledge, but they don't get there. That’s why things are breaking down.
Enablement is partially about sales because it’s all about selling internally. This includes behavioral shifts and changes, processes, tech, etc. Everything is an uphill battle without buy-in from key stakeholders, managers, and leaders.
This could also lead to adoption and engagement rates dipping in the name of proof. Here’s how I go about getting buy-in from key stakeholders:
Frontline managers in the field have the battle scars to show for it and know what is happening. Their information and first-hand knowledge are critical to helping us understand the field. The first thing is to listen to your front-line managers.
What are they saying? What are they asking for? They've been seeing the bullets, and they've been seeing what is happening. Enablement can always say, ‘The data is telling me this. So let's just do that.’ However, there needs to be context.
That means there needs to be empathy for what is happening on the field and why it may be happening. This understanding only comes from communicating with the key stakeholders in the business.
While enablers talk a lot about data and being data-driven, those are pertinent with empathy for frontline managers and your reps. Data does play a part and helps highlight what is working, what is not, and why. Sometimes, that information shines a light on aspects that may not be accessible to the frontline leaders. For instance, you can't use that to shed light on behavioral aspects.
Let’s use a sporting analogy here. Suppose a top-class athlete has just run a 100-meter race. The coach will analyze what has happened in every stride, from the starting to the finishing position and everything in between. This analysis will allow the coach to tell the athlete, “You need to avoid X. You need to be doing ABC a little earlier. You rushed Y, you need to slow down here.”
These nuances only come to light when the coach has analyzed something in-depth. That level of analysis, not just in terms of data but in terms of behavior and competence, can undoubtedly shed light. Ultimately, enablement is here to help frontline leaders to hit their goals. That's what we need to show them. Questions to ask around that could include some of the following:
- What is the goal?
- How are we tracking it?
- What is the plan to achieve that goal?
- What will stop you from achieving it?
If enablement can combine that with the information available on data points and show you can solve it, that's a great way to get buy-in from front-line managers.
Enablement without onboarding
While onboarding is a primary function of enablement, what happens when companies aren’t hiring? There's no onboarding to do. People focusing solely on onboarding was one of the reasons enablement has suffered in the last 12 to 18 months. If you were to ask a sales leader or anyone in the C-Suite what their enablement division does, what do you think their answer would be?
We have to broaden our limits and evolve from just training and onboarding. When looking at the pillars of enablement, most of them aren’t around onboarding. These are useful to remember, especially when companies are not hiring reps.
Here are the pillars:
1. Competency development
Competency development is vast and contains numerous aspects. While onboarding falls within this pillar, there are also aspects around sales performance optimization.
How do we improve what we are doing? How can we do it faster, more productively, and improve?
Here’s how enablement can optimize rep performance at the competency level:
- Understand the competency levels of your existing team
- Know what the gaps are
- Figure out where your reps need to be
- How to bridge those gaps is how we can optimize performance
Training and coaching are also parts of this pillar. Establishing a coaching culture and using structured competency frameworks to coach better and follow up on coaching is essential in a group setting. Additionally, enablers can leverage the data captured through competence analysis and assessments to drive enablement strategies.
Instead of simply saying pricing is essential, enablement needs to get everybody to do negotiation training. For instance, you may have a team that is great at negotiation. Instead of full-fledged training, you could have them explain how they negotiate and apply it to reps who could be better at it. Competency development helps develop time-targeted strategies to improve specific skills.
2. Productivity and efficiency
How can your teams maintain quality and do what they do faster? How do we optimize time spent on selling? Playbooks play a part here, helping people navigate the process and giving them everything required to execute it. Qualification is also another significant aspect. How do you focus on those opportunities that will make a difference for the organization?
Sales process optimization is another aspect and includes tech stack automation, content management, etc., all of which contribute to making people more productive and efficient.
How do sales reps spend their time? The general statistic is that 30 to 40 percent of their time is spent selling. What's happening during the remaining 70 percent? How can enablement streamline it? This is an essential pillar in optimizing performance.
This pillar consists of all-around aspects such as sales methodologies, buyer experience, buyer engagement, etc., which are all critical. How do we measure buyer engagement? Once we measure it, how do we impact it so that it's positively increasing? Differentiation plays a key role here based on the ICP persona, the specific industry, the competitive landscape, etc.
Best practices stay with reps and play a huge role here. Based on the performance levels of sales reps, they will be doing some great things every day. How can enablement capture that and propagate it across the entire team?
What can enablement do differently across these multiple parameters?
Do you have the trifecta of sales, product, and marketing? How do we bridge them and ensure a collaborative environment across all three aspects? Companies need to go to market seamlessly and efficiently, and enablement plays a significant role here.
Let’s consider campaign management, for instance. Enablement needs to be on top of aligning campaigns between marketing and sales. Buyers' journey, for example, is a long joint process across the entire sales and customer cycle.
5. Optimizing engagement levels
The focus of this pillar is often overlooked, but it's especially crucial when companies aren’t hiring. How can enablement optimize the engagement levels of the sales team? How do we motivate and inspire them? How can enablement play a role here?
While specific events can be organized to help, what about the experience we provide to the reps? Are we giving them a frustration-free environment for them to work? Are they having to routinely do tasks they don't want to do (based on time or complexity), which impacts their ability to sell? Engagement is vital. How do we keep our finger on the pulse?
Then, there are aspects like career progression, all of which lead to retention. Suppose you have a sales rep delivering US 1,000,000 dollars a year in new deals. If they leave, the cost is immense, not just in terms of lost revenue but doing it all again.
You run the risk of wrong hiring. Suppose you don’t even get the budget to hire. Retaining people, career progression, and career trajectories play a massive role in how enablement can help people get to where they want.
The five pillars of enablement focus on multiple aspects and nuances of enablement, especially when companies aren’t hiring. Think of it as self-performance optimization of the existing team.