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The Center for Sales Strategy Blog

The Compound Effect - Start With the End in Mind


In a former life, I was a professional triathlete and triathlon coach. I helped athletes with a wide range of athletic backgrounds accomplish one of the greatest physical tests of endurance known to man: completing the Ironman, a combined 2.4-mile swim, 112-mile bike ride, and a 26.2-mile run. When clients would first come to me and ask for advice about their training plan, they would inevitably ask, “What do I need to do to be able to finish the Ironman?” The answer was the same for each client: “You need to be able to swim 2.4 miles, ride 112 miles and run 26.2 miles in one day." That was a very definitive end goal, and the goal had a definitive date. The challenge then became how to take them from where they were physically on that first day, to that end point several months (or for some, years) away, ending at the Ironman finish line.  

Maybe I’m a little late to the party, but I have just been turned on to the book “The Compound Effect” by Darren Hardy. I wanted to share a few thoughts on its relevance to sales managers and leaders—and how it relates to my story of someone training to complete an Ironman. You might not realize it, but some of the challenges that sales managers face when building a sales organization are similar to what triathlon coaches are up against when training an athlete for the challenge of the Ironman. These challenges are: defining the goal, creating the strategy to accomplish the goal, and taking the required steps needed to accomplish the goal.

Defining the Goal

Beginning with the end in mind is a strategy that has been used by many coaches and trainers. Envisioning what you are trying to accomplish, such as coming up with specific revenue targets or sales quotas, will usually help you hone in on the resources needed to accomplish your objectives. In terms of sales, if you are currently averaging sales of $1 million per year with five salespeople, and if you want to double your sales in a year, you have a couple of options. You can double your salesforce and maintain the same productivity level, or you can increase the productivity of your current team of five and then add a couple of additional salespeople, rather than doubling the size of the team.  

The important thing at this stage is using SMART goals and defining what you want your final destination to be and when you expect to get there. Then and only then can you can start putting together the road map on how to get there. That’s where the strategy comes into play. Just as with athletes, all organizations are different and a single strategy won’t work for everyone or every organization.  

Creating the Strategy

Without a strategy or a plan to accomplish your goals, your chances of success are minimal. Most worthwhile endeavors in our personal and professional lives don’t just happen by luck and circumstance. No, quite the contrary. In life and in business, you tend to get what you focus on and where you channel your resources.

If your goal is to double your sales but you lack the salespeople needed to accomplish that, you will no doubt either need to hire more salespeople or to implement new processes or technology to increase your current team’s productivity. If senior management isn’t willing to invest the required resources to increase the size of the sales team or to provide technological upgrades that are needed to implement your strategy, it’s going to make it much harder to reach your goals. Lofty goals typically require an outstanding effort and commitment of resources to make them happen. In the case of training for an Ironman, if you don’t want to spend most of your weekends riding your bike or running mile after mile, you probably won’t do very well with the training required to complete the Ironman. In addition to formulating a solid strategy, you also need to dedicate the required resources to it.

Taking the Steps to Accomplishing the Goal

When people start training for a first Ironman, they usually have never swum 2.4 miles or ridden their bike 112 miles without stopping. Some haven’t run a marathon either. So how does someone with a lofty goal such as completing the Ironman (or in our sales manager’s case, doubling sales) go about achieving this?  

The key in both situations is taking incremental steps and putting the theory of “compounding” to the test. Compounding in the most common sense of the word involves generating additional benefits or resources from work previously done. In the case of a sales organization, it could be developing benchmarks along the way that each salesperson would need to meet on a quarterly basis to ensure the entire team was on track to make the annual goal.

Utilizing the theory of compounding, the first quarter goal would be somewhat less than simply dividing the goal by four, and would account for an increase institutional knowledge and learning after each quarter. Through training, investments in technology, and changes in processes and procedures, your team can become smarter and more productive every quarter and see the positive impacts of compounding. Adding a 30-minute training session or bringing in some new technology to improve performance by just a little bit each month can make a huge impact over an extended period of time. Just think if your sales team was able to sell just 1% more each month, every month. After a year that wouldn’t be just a 12% increase in sales, but much more when factoring in compounding.

While the concept of compounding is typically referred to and used when dealing with financial matters, it can really be used in every aspect of your personal and professional life. If you can make small changes on a daily or weekly basis over an extended period of time, you will be amazed by the results. By starting with the goal in mind and knowing your timeframe, you can work backwards into where you should start and know how difficult its going to be to accomplish your goal. The harder the goal, the more resources will be required.

Whether it’s improving the performance of your sales organization or getting off the couch and training for a 5k, every little increase in performance adds up. These small improvements might not seem like much in the short term but they can sure pay long term dividends. It’s much easier to tackle something like doubling your company’s sales within a year or training for the Ironman if you can focus on small improvements every day.

And you never know… you might just become the hero of your organization or finish an Ironman by just improving by 1% per month, every month.

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