Over the past few years, we have seen a huge rise in the popularity of establishing SDR teams. The promise of significant pipeline growth and increased lead quality, whilst enhancing the customer experience, provided a clear value proposition to Sales Leaders for investing in SDR Teams.
Sadly, SDR doesn’t stand for ‘Simply, deliver, results’, establishing these teams has proved more complex than expected and returns harder to quantify. SBR Consulting regularly fields requests from their 800 clients seeking reassurance and third-party insight as to how to establish or scale an SDR team. Questions include:
- Is our current SDR output ‘typical’?
- What metrics should we be using to quantify results?
- What incentive structure should we use?
- What is the ideal SDR hiring profile?
- What tech tools can provide optimal output?
- What training is available to unlock increased performance?
Whether establishing an SDR Team from scratch, or looking to optimize your existing one, our recommendation for ensuring success is using the 5-M Framework:
1. Mission
Before establishing an SDR team it is critical to align the team inception to a specific business goal, challenge or identified growth opportunity. This will provide the necessary return on investment (ROI) hypothesis and clarify the key performance metrics to validate it.
- Typical Missions/goals/challenges are:
- Increase total pipeline and customer outreach.
- Reach new logo customers/ build new logo pipeline.
- Reach target market(s) with new GTMs.
- Increase inbound lead qualification speed and quality/ improve conversion rate.
Once agreed, it is key to wrap a specific output around the mission and attributing a specific performance value i.e. Increasing total pipeline by 24% will result in an additional £8M in revenue. Note, if you are reviewing your existing SDR performance, returning to the initial investment metrics is a great place to start. As the business matures and faces different challenges, the SDR mission may be required to evolve, it is just essential to maintain focus on the ROI and expected performance outputs.
2. Management
Once the mission is established, deciding where the SDR Team will live in the business is the next step. Typically, SDR teams live either in the Sales or Marketing orgs, but can live in Customer/ Product/ Enablement Teams. The recommended approach is to align the SDR Management to the mission, so, if the business goals are inbound lead-oriented then Marketing may be the best reporting line. On the flip side, if outbound pipeline growth is the focus, alignment to Sales leadership may be the prime solution.
If your SDR team does both inbound and outbound, then ensure you have exact clarity on the breakout of the work, prioritise their mission and how the SDR team will report success to their various stakeholders. Typical challenges SDR teams face is serving multiple masters (inbound vs outbound) so alignment to the best serving management team is key.
It is advised that day-to-day management falls to an experienced SDR leader, one with experience building and scaling multiple SDR (or similar) teams and understands the evolution required. Management requires the right balance of operational excellence to scale the team and the tactical prowess to deliver the broader sales strategy. Investing in external talent can offer invaluable support when creating the Org Design, compensation, hiring and tech stack strategy, as well as validating the optimal approach to achieve the mission.
3. Momentum
Regardless of Mission and Management, one of the fatal errors when building SDR teams is not focusing on Momentum. It is likely that creating a successful SDR Team will take several revisions and go through many iterations to get right, you are aiming for progress not perfection (see Continuous Improvement Wheel). Start, fail, learn, iterate and build momentum. SDR teams have to create capacity, focus on output, building habits, systems and momentum before results and quality.
It’s a role that benefits from tenure, exposure and experience. Ensure the necessary training is in place to not risk reputational marketplace damage and get them operational. The experience of creating a 1000-person outreach campaign with a 1% response rate is a key part of the learning journey to creating a 50-person campaign with a 25%+ response rate. Build successful habits, expectations, capacity, and momentum, then focus on quality.
4. Measurement
SDR success measurement will likely evolve with the team, transitioning from volume to quality, before landing on the focus that achieves the original mission. This evolution could look like:
- Expected #calls or #emails
- Volume of SQL/MQLs created
- Quality Meeting Completed (QMC)
- #Opportunites created
- Value of pipeline created (£)
- #Deals Closed
- Value of deals closed
For inbound workflow, the measurement could focus on MQL conversion, quality, and speed as well as ‘time of touch’ efficiencies.
Benchmarking expected outputs can be challenging and vary drastically between industry sectors and geographies. Using external consultants with experience enabling SDR teams across multiple regions and sectors can help unlock optimal performance.
“When I had to scale a team of Sales Development Reps globally, Andrew helped create the strategy to position this team and trained them to create value in the broader Sales org”
Arafat Mir Global Sales Development Leader
S&P Global Market Intelligence
5. Mobility
Talent retention is one of the critical success factors for SDR Management. Following the initial 3-6 month ramp time, the path to mastery for an SDR is short and top performers quickly start to push for moves into move lucrative junior sales or AE roles. Whilst SDR teams can create excellent talent feeders into these roles, it is essential to curate this mobility journey.
Our recommendation is creating a 3-year ‘hire to AE’ (or introductory quota-carrying role) pathway that includes training, certifications, progression, pay increases and clear performance outputs. Without constitutionalising the SDR role, mapping exactly what is expected and how they fit into the wider sales ecosystem, companies run the risk of role dilution, confused customer experience, talent attrition and total sales output decreasing.
Summary
‘Simply deliver results’ is not a strategy for establishing or scaling an SDR team. SDRs can play a vital role in accelerating pipeline growth, enhancing lead processing and delivering significant sales growth. They can also, in the absence of a well-executed strategy, be an investment that negatively impacts both bottom and top-line sales performance. Whether establishing, scaling or reviewing your SDR team, the 5-M Framework provides the foundation to support your SDR journey.
Other useful resources
Upcoming webinar!! Webinar: Defining Your Customer Journey
Blog: Developing a tech stack strategy
Publication: Onboarding Salespeople Successfully
Publication: Sales Compensation Planning: Principles of Success
To talk to us more about scaling your business, please get in touch by emailing info@sbrconsulting.com or call us on +44 (0) 207 653 3740.
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Citations
Sophos Case study ‘Improved manager & rep effectiveness across different teams & geographies‘