Sabermetric Sales: 5 Actionable Strategies From ‘Moneyball’ for CROs

“If gross miscalculations of a person's value could occur on a baseball field, before a live audience of 30,000, and a television audience of millions more, what did that say about the measurement of performance in other lines of work? If professional baseball players could be over- or undervalued, who couldn't?”— Michael Lewis, Moneyball

In the book Moneyball, author Michael Lewis tells the underdog story of Billy Beane, the general manager who led the cash-strapped Oakland Athletics to unlikely success. From 2000 to 2002, the A’s won 296 games, the second-most in baseball, despite working with the third-lowest payroll in the league. Beane, in collaboration with his stathead assistant GM, Paul DePodesta, employed emerging modes of statistical analysis to make smarter personnel decisions. Using the concept of sabermetrics, which at the time were new ideas and approaches to baseball analysis produced by a group of baseball stats nerds called the Society of American Baseball Research (SABR), Beane and the A’s targeted undervalued assets and exploited market inefficiencies to build a better baseball team for less money.

As a sales leader, I can’t help but see parallels between the pre-Moneyball baseball landscape and the sales world in which I came up. Over the years, I’ve known a lot of salespeople, and I’ve heard a lot of explanations for why sales success happens: “She has the killer instinct.” “He really comes through in the clutch.”

Looking back, these explanations sound an awful lot like how people used to discuss promising baseball players before they actually understood the formula for success.

Smart organizations and leaders know that these cliches don’t tell anything close to the full story. Like Billy Beane before them, they are discovering ways to better measure sales performance — which, like sports, happens in a people-centric environment — and they are using these metrics to close more deals, hire better reps, and provide more useful coaching. Let’s take a look at some of the lessons from Moneyball and how we can put them into action to gain an edge for our sales teams.

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Lesson One: Get Everyone to Buy Into Your Vision.

In a perfect world, all of the reps on your team would be top performers. But that’s not reality. Instead, most sales teams are composed of reps with a wide range of experience and a variety of strengths and weaknesses. So, what makes top performers stand out from the rest? Usually, top performers share a number of common competencies and selling skills. Those skills that are correlated with success in the field and differ depending on your industry, your company and its position in that market. 

To enact his vision, Beane had to get his scouts, the owners, the coaches and managers on board. Similarly, you need to get buy-in from various revenue stakeholders and contributors. That’s step one. 

As the person responsible for the sales team, you must define the skills and behaviors that an ideal rep should exhibit because you set the north star for the organization as a whole. CSOs or CROs should lead the charge in their teams’ efforts to identify what’s required for reps to be successful, as this blueprint has direct implications on revenue.

For instance, SalesOps or RevOps can draw insights from historical sales data to define the ideal rep. The head of sales enablement or training can tie current and new initiatives to key skills to align sales with the right set of training and education. Your frontline managers are your “player-coaches” directly working with reps, and they must be a part of the defining process so that they are able to bring important data points and observations of skills and behaviors.  And, of course, don’t forget to reach out to your counterpart in marketing so they can better incorporate customer-facing assets that help sales teams sell.

Lesson Two: Include Measurements of Skill in Your Performance Reviews and Readiness Planning.

We tend to measure sales success by looking at outcomes. How many deals have you closed? For how much? How long did it take? Even so, we all know that outcomes are influenced by many factors outside of a rep’s control. Although we may expect those external factors to even out over time, like baseball, sales is a competitive environment. So, we don’t always have the luxury of waiting for more data before we make important decisions.

In baseball, the statistic earned run average (ERA) measures how many runs a pitcher gives up per nine innings pitched. For many years, it served as the primary measure of pitching performance. The problem with ERA is that runs are an outcomes that pitchers influence but don’t entirely control because other factors — the quality of the team’s fielders behind them, for example — also affect ERA. Beane and DePodesta instead used a metric called “defense-independent pitching statistics,” which was developed in the late 90s, that would help them find diamonds in the rough who were undervalued because they played on teams with bad defenses.

If you judge reps’ successes based solely on win rates or total contract value, your personnel decisions are being unduly influenced by luck and circumstances like unproductive territories or economic factors beyond their control. If this sounds like your sales organization, read on to learn how to move away from relying on subjective factors to make data-driven decisions to build a scalable, repeatable revenue engine.

Lesson Three: You Can’t Maximize Your Edge by Playing the Game the Same Way as Everyone Else. 

The most important philosophy behind Beane’s approach wasn’t that he should spend as little as possible; Beane was operating within unique constraints that required that he adjust his approach. Teams with significantly deeper pockets wouldn’t want to make the same decisions Beane did. They would have been smart, however, to emulate Beane by tailoring their approach to their own circumstances. 

You should examine your sales roster in the context of your competitive landscape and business objectives. What can you do to maximize your strengths and compensate for your weaknesses? You won’t achieve maximum results by using the same tools and tactics as everyone else. 

Instead, find ways to identify and target your ideal rep profile (IRP). How does product knowledge compare with competitive intelligence when it comes to selling your product? Do your customers respond better to persuasion and persistence or listening and building rapport? 

When you’ve identified the particular mix of skills that lead to success for your team in your market, you can use that information to tailor your onboarding, enablement, and coaching practices to that IRP. Keep an eye on your team’s performance with deal review and field insights (e.g., conversation intelligence) and adjust your IRP on a regular basis as your understanding grows. This practice will help you retain your highest performing reps and hire more and better candidates for your unique system.

If your business is struggling to define winning competencies, look to the knowledge, skills, and behaviors of your leading sales reps. In addition to being key revenue drivers, these folks have a demonstrated formula for success. Use them as models for your sales enablement team to build programs that focus on these proven competencies. 

Lesson Four: The Most Visible Skills Aren’t the Most Important Ones. 

The narrative of Moneyball follows the team’s performance in the 2002 amateur baseball draft. At that time, most organizations left the decision of who to select in the draft up to their teams of scouts. These scouts were grizzled baseball vets who relied on rudimentary instruments like radar guns, stopwatches, and their own eyes and acumen to quantify a prospect’s current ability. Then they added a mixture of accumulated assumptions, vague hunches and gut reactions to project how a player’s skills might develop over time. But Beane’s data-driven approach targeted players who were undervalued using traditional scouting methods. As a result, he was able to draft pretty much every player he was targeting.

Relying solely on our own perception allows biases to cloud our judgment. Use frontline managers, who directly work with reps, because they’re where the rubber meets the road. Managers are able to share important information and observations that can help define the IRP. SalesOps will have the information you need to start determining your IRP based on sales performance and other pipeline management metrics. Enablement professionals will be key to putting this new focus into practice throughout the organization. 

When technology like conversation intelligence and analytics discovers new infomration about the field-readiness of your team, some of these insights will cut against your assumptions. By using these same insights that surprise me to challenge my own beliefs, however, I’ve become accustomed to the pleasant surprise of reps outperforming my expectations.

Lesson Five: It’s Not About Having the Most Data. It’s About Having the Best Data. 

The baseball world has always been obsessed with stats. Official scorers have recorded very activity in MLB games for the last century and a half. Because of the plethora of information available, Billy Beane wasn’t the first general manager to make stat-based decisions. With so much information, however, most GMs couldn’t distinguish the noise from the signal. And GMs aren’t alone in this problem. Lewis quotes Bill James, the primary figure behind the sabermetric revolution, who worries that even sabermetricians can suffer from worry about the effect of having too much data: “I wonder if we haven’t become so numbed by all these numbers that we are no longer capable of truly assimilating any knowledge which might result from them.”

The digital revolution has left many of us drowning in data. Sales reps at some organizations fill in so many custom fields in their CRMs that they start to feel like data entry specialists who sell on the side. With business intelligence tools consolidating data from different parts of your tech stack, the amount of information can become overwhelming. Every modern sales organization is gathering tons of data just in case they might need it. How do we distinguish the signal from the noise to take action right now?

For starters, when reviewing your sales tech strategy, focus on the quality of analytical offerings over the quantity. Look for solutions that help you translate lots of data into well-organized, actionable insights. And instead of waiting for the deal to close and then trying to figure out what went right or wrong, measure how reps are performing against the skills you and your team have trained them to use proactively, identifying areas that need to be upskilled. 

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Overall, one of the most important things to remember is that you don’t have to figure everything out on your own. Align your team around a unified approach and work together.

Beane wasn’t a math genius. He didn’t have the most experience among GMs, and he certainly didn’t have the most resources. He succeeded by being willing to challenge the status quo and listen to ideas from smarter people who were shut out by old-school baseball management. 

As sales leaders, we don’t have to be geniuses either (thank goodness), but we have to be open-minded enough to identify the approaches that will work for our organizations. We must have the courage and persistence to mold our sales culture around that vision. And we have to find our internal allies — those folks who will work with us to enact key changes. Billy Beane’s most important battles in building a successful team weren’t on the diamond against other teams; they were in conference rooms, working to build internal consensus around an unconventional approach.

Who in your organization can provide you with the information and insight you need to accomplish this alignment? Use technology and data, but recognize the fact that at the end of the day, building up your people and your culture wisely has the greatest impact on the bottom line.

Billy Beane is a gifted leader, but he’s not going to suit up and get the job done on gameday. No matter how good your ideas are, if they stay within the walls of your office, they aren’t going to change anything. As a sales leader, your job is to collaborate with your team to establish a direction, and to ensure each member of your organization has the resources they need to play their part. Perhaps the most important lesson you can take from Beane’s story is a simple one: sales, like baseball, is a team sport