To help senior leaders of European companies realise more growth in 2015 via sales management, we are publishing a series of relevant articles. But given January’s announcements of deflation threats facing Europe (falling prices and delayed purchases of consumers) it seems that now there will be even more pressure on sales to deliver and sell more!
In our last article we introduced the importance topic of how organisational alignment can contribute to better sales management within an organisation. We introduced the concepts of three distinct levels of metrics: 1) Business results metrics, 2) Sales Objective related metrics, and 3) sales activity related metrics).
This week’s article zooms in on the third level and will answer two questions: What are the killer metrics for sales management?Which metrics per key sales processes?
As background, our partners at Vantage Point Performance analysed a collection of 174 sales metrics used in total across over 30 companies. Though there were many metrics in common across the companies (% of Reps Attaining Quota, % Cross-Selling of Products, $ Spent on Training, etc.), there was little commonality in the way the measurements were organised.
To help find the killer metrics, all 174 metrics were put into a big pile and organised by the key question: How ‘manageable’ is each metric? That is, how much control does a sales manager have to directly affect the specific metric?
An example of a ‘manageable metric’ is the Number of Accounts managed Per Sales representative. This metric is highly manageable, since a sales managers can easily reassign their sales reps’ accounts to increase or decrease the number.
An example of an ‘unmanageable metric’ is Revenues Per Sales Representative. No sales manager can simply command a salesperson to have more revenues (though many have tried). There are many factors that affect a salesperson’s revenue number, so it therefore cannot be directly managed by a sales leader.
Killer sales force metrics need to be truly managed with levels of certainty and control, because they are the immediate results of actionable decisions made by a salesperson or by a sales manager.
Our conclusion is that there are key metrics and these fall in six sales processes. These metrics drive desired sales behaviours and deliver better sales performance.
- Sales Process metrics
- Call management metrics
- Opportunity management metrics
- Account management metrics
- Territory management metrics
- Sales Force Enablement metrics
1. SALES PROCESS METRICS
They have a very high value in managing a sales force. For front-line sales managers, these should be the primary pieces of feedback about the ongoing performance of their salespeople. In fact, we believe these are the best leading indicators of sales performance – that the proper selling activities are being executed properly.
SAMPLE SALES PROCESS METRICS:
- # of Sales Calls per Sales Representative
- % of Account Plans Completed
- Hours of Training per Sales Representative
- Hours of Coaching per Sales Representative
- Types of training that a company provides to their reps
- % of Reps Using the customer relationship management (CRM) system
2. CALL MANAGEMENT PROCESS
This process is intended to help salespeople plan for specific customer interactions – whether face-to-face or by phone. Sales persons typically plan their desired call outcomes, questions they might ask, objections they might expect, products they might propose, etc.
SAMPLE CALL MANAGEMENT METRICS:
• # of meetings or calls prepared prior to meeting or calling the customer
• % of Reps Complying with the Process
• % of Successful Call Outcomes
If the activities linked to customer visits and calls are effective, these should generate specific sales opportunities. A Singles sales opportunity is where for a customer or a prospect a specific product or service that could be sold has been identified. In this specific case, it is important to have a view on to whom you are selling, what volume, what price, and what is the good timing for the customer to use this product/service.
3.OPPORTUNITY MANAGEMENT PROCESS
If opportunities are to be created then there is a need for managing and helping salespeople to plan and execute these, a step especially important for complex or long sales cycle opportunities. Often confused with ‘pipeline management,’ this process is not an analytic exercise to show failures in a collection of ongoing opportunities – this is an assessment and planning effort to deliberately win an individual sales pursuit.
SAMPLE OPPORTUNITY MANAGEMENT METRICS:
• % of Reps Complying with the Opportunity Management Process
• % of Reps Using Supporting Tools to help remove risks or progress an opportunity
• % of Objectives Met
4. ACCOUNT MANAGEMENT PROCESS
If there are multiple opportunities over time with a single customer, then we have an ‘account.’ An Account Management process helps a salesperson to assess their position within a key customer and coordinate among internal and external resources to grow the long-term value of that account.
SAMPLE ACCOUNT MANAGEMENT METRICS:
• % of Reps Complying with the Process
• % of Reps Using Supporting Tools
• % of Objectives Met
5. TERRITORY MANAGEMENT PROCESS
If a salesperson is assigned a group of accounts or prospects, then they have a ‘territory.’ Note that a territory does not necessarily need to be geographically defined – a salesperson could be assigned accounts that are chosen in many ways (industry, customer segment, etc.). Regardless, a Territory Management process helps salespeople and their managers decide how to allocate their time across a large group of customers.
SAMPLE TERRITORY MANAGEMENT METRICS:
• # of Accounts per Rep
• % Prospects vs. Active Customers
6. SALES FORCE ENABLEMENT PROCESS
This process has the largest scope of them all and is very diverse by nature. Sales enablement activities include recruiting, selecting, training, motivating, coaching, rewarding, and providing tools that enable the sales force’s performance. This process is typically shared across several people and departments, including sales, HR, and finance.
SAMPLE SALES FORCE ENABLEMENT METRICS:
• % of Time Spent Coaching
• Hrs of Training per FTE
• $ on IT Systems per FTE
• Span of Control
So to get powerful results, ensure the metrics are in place per the processes that exist in your company or the roles assigned to your sales persons. The Sales Managers have the responsibility to ensure that these metrics are in place and to coach their teams on using the relevant processes.
Interested in more content on the topic?
- Register for one of our training sessions ‘Cracking the sales management code’ to get live tips from experts and learn how to apply these best practices within your team
- Read the third article of this blog series on the best practices in measuring and managing a Sales force
- Download the first chapter of the bestselling book Cracking the sales management code®.
Source of article: Vantage Point Performance