Some years ago, the leader of an outbound SDR team had set very aggressive call goals. This leader held the people accountable for making their goals, but they struggled. But one person consistently beat the goals. The leader held this individual up as a high performer.
But when I started looking at the performance, I realized, despite consistently meeting the goals, the number of qualified leads this person was developing was about the same as his peers. I thought, “Why is this person significantly and consistently exceeding the call goals, but the results are mediocre?”
I started listening to the calls this SDR was making. I realized this SDR was gaming the number. He recognized his manager wanted to make the goals, the calls that counted were 5 minute calls. What he was doing was calling his buddies, talking about what they would to that evening. At the 5 minute mark, he would hang up, then call the buddy back. Even when he was talking to a prospect, he would hang up at 5 minutes, then call the person back. He’d broken the code to exceeding his call goal, and all his manager was focusing on was the number of calls.
Another client, the leaders were very proud of their win rates. They were consistently above 60%. But they were still struggling to make their numbers and fill their pipelines. As I started doing the analysis, I noticed they had unusually short selling cycles. It was a professional services company selling complex service offerings. I had actually worked with a lot of other clients, including their competitors. This company was getting win rates above 60% and their selling cycles were 20% that of their competitors.
This didn’t make sense to me. Could this possibly be true? What were they doing that drove such high win rates and short sales cycles? And despite doing this, why were they struggling to maintain healthy pipelines?
As I dove in, I discovered the sellers were not entering opportunities into the pipeline until they were actually in the contract negotiation stage. They had won the business, the losses were only because in the contracting process, the project got derailed.
Why were they entering them so late? Why weren’t they creating opportunities early in the engagement process? Why weren’t they showing those opportunities much earlier in the qualified pipeline? Why were they waiting until the final stage of their process to enter them into the CRM pipeline?
It turned out, management was being relentlessly tough on win rates. They would drill into their people that anything less than 50% was unacceptable. This was exacerbated by the deal review process. Managers were only interested in reviewing deals that were “close to closing.” Their focus and the deals they cared about were in the contracting stage. They didn’t pay any attention to the earlier stages and coaching those opportunities.
A few sellers, then more, broke the code. The way they could keep the managers off their backs and keep them happy was to never put a deal into the pipeline until it was in the contracting process. They maintained “off the books” pipelines, moving them into CRM only when the were in the contracting stage. And managers didn’t realize this because all they paid attention to were opportunities in this final pipeline stage.
These are just a couple of examples of sellers “gaming the system!”
Some people looking at this react, “Those sellers are really terrible! They are gaming the system! We need to straighten them out, they need to stop gaming the system!”
The reality is gaming the system is the result of management failure. I’ll just leave this statement here for a few moments. I’ll come back to it. While I have a very tough perspective of this problem, there are some other ways to look at it. But, again, the dominant reason for sellers gaming the system is management failure.
But let’s backtrack. “Gaming things” is a part of human nature. And some types of gaming can be very powerful.
Each of us constantly looks for shortcuts or productivity hacks. How can we accomplish our goals with less work? So we look at different techniques to shift the numbers in our favor. And these can be very powerful. And when some of the best of these are identified, showing all others how to, similarly, game the system could drive performance. When I start a project, one of the first things I do is to identify “the laziest seller that always makes the numbers.” This individual has broken the code to success, we can learn much from them.
There’s another reason we “game” things. We want to keep our managers happy! We want to keep them off our backs! As a result, we start figuring out how to game the system. Whether it’s breaking the code on the outbound call metric, because all the manager is paying attention to is that number. Or delaying entering an opportunity into the pipeline because what managers care about is the win rate. Or hitting the meeting goal, by having meetings that don’t really accomplish things, but enable us to meet our meeting goal. Or having a 3X pipeline even though the pipeline is filled with garbage—but our managers demand a 3X pipeline.
It is human nature. It’s not that they are being malicious or deceptive, they are simply trying to keep their managers happy and make their lives easier.
And it’s not their fault! They are responding to what we tell them is important. But we may be telling them the wrong things, or we may be focusing on the wrong things or too few things.
And, in fairness to managers, too often we are absolutely unconscious in how these behaviors are developed and reinforced by our own behaviors. We may have “grown up” in an environment where our managers focused on one to two things, we are just doing the same thing. Or we may be hyper focused on a certain challenge, and we over-rotate on that single number, not thinking of the behaviors we are driving.
For example, we may have a top of funnel challenge, as a result we fixate on a specific metric, perhaps outbound call volume. And all we do is count the calls. We don’t look at what those calls are producing, or the quality of those calls, or…. So while we are overachieving the number, we are achieving the outcomes expected.
And to keep managers happy, sellers become fixated on that call number. Unconsciously, they may not care about the quality of the conversations, that they are talking to the right people, that they are talking about the right things. They are just focused on the number.
You can see how this vicious circle of behaviors happens. It’s not the fault of our people. It is a result of short sighted thinking on the part of managers.
What do we do about this?
There are a number of different approaches. One might be focusing on metrics that counterbalance each other. For example, rather than look only at number of outbound calls, we might also look at % of those creating a qualified opportunity. (Or we might only measure the number of qualified opportunities created, not caring about the number of calls it takes to create those.)
Another way is to expect every critical metric we focus on will be gamed. But if we think of how it will be gamed and it still produces the outcomes we need, we will achieve our goals. We might even train our people in how to game this particular metric.
Fundamentally, we have to look at everything we do as a set of interrelated parts, a system. Ignoring some parts of the system, hyper focusing on one small component of the system will, inevitably, cause the system to fail.
Our people will do what we tell them and measure them on. The issue is are we telling them and measuring them on the right things.
And they will try to employ every shortcut/hack to do these things. Knowing they will do this, are we telling them and measuring them on the right things.
Afterword: As we look at how we use the LLMs, an interesting thing to consider is, “Are these LLMs gaming us?” Afterall, their goal is to keep us happy, so are they giving us the answers we want, not the answers we need?
Afterword: Here is the AI generated discussion of this post. Enjoy!
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