How To Measure Sales Success
How To Measure Sales Success is the question on most sales managers lips at this moment in time when every sales is vital, alongside measuring those who are delivering in your team.
Companies most likely to thrive are those that scrutinize their strategic sales-management plans, from forecasts to pipelines. They look hard at the cost of sales, percentage of market share, salesperson-effectiveness ratios and customer lifetime value. Conversely, companies that struggle often lack such blueprints.
Effective plans require combining an organization’s goals with the individual salesperson’s business plan with a set of metrics designed to gauge everyone’s progress in meeting those objectives. The fundamental metrics to include in “dashboards” for measuring sales team effectiveness:
Accuracy percentage for monthly forecast, by salesperson
Dollar or pound value of pipeline by stage; number of opportunities by stage
Dollar or pound value of pipeline ratio to future monthly quotas
Actual sales activity compared to a defined set of standards
Average order value
Win/loss percentages by salesperson
Beyond the Basics
As you continue developing your dashboard, consider additional metrics such as:
Value of net new account sales as percentage of total sales for month and year to date
Existing account sales as percentage of total sales, month and year to date
Salesperson profitability to sales volume
Revenue per current customer per year as percentage of total sales
Cost per lead by source
Sales-cycle time from initial contact by salesperson to decision
Number of days with sales outstanding, goal vs. actual
Blended billing consultant rate, goal vs. actual
Realization consultant rate, goal vs. actual
Utilization consultant rate, goal vs. actual
Consultant backlog days, goal vs. actual
Direct sales expense as a percentage of volume, margin and quota
Looking Ahead: Leading Indicators
Leading indicators are activities or ratios that can predict revenues at least 60 days out. While simply looking at future pipeline values can provide a similar forecast, these indicators are also useful. In most cases, certain events early in the sales cycle are most likely to lead to high-percentage sales opportunities. If these begin to fall, future pipelines and revenues will probably do the same. Potential leading indicators include:
New-prospect calls made per week
Face-to-face sales calls made per week
Subject-matter expert or pre-sales tech-support calls made per week
Discovery calls made per month
Demonstrations and executive presentations made per month
Graphs comparing these numbers to dollars booked or margins generated help salespeople see the relationship between indicators and results. Finally, the ultimate goal is improving ratios and results each month and each quarter-not simply tracking them. That’s the real reason for developing a dashboard and the real route to success.
Ken Thoreson, Acumen Management president, is a recognized sales management thought leader with more than 20 years of software/technology experience, including 17 in niche market distribution with emerging and high-growth national companies. The sales management strategist is regarded worldwide as an expert in sales execution, channel management, revenue generation, sales analysis, forecasting, recruitment, and training within the sales function. Prior to founding AMGL, he led development-stage, entrepreneurial, and $250-million national vertical software sales organizations as vice president of sales.
Ken is a frequent speaker and keynote presenter at major industry conferences, including Microsoft Worldwide Partner Conferences, Cisco Systems Worldwide Partner Conference, Sales and Marketing Executives International Conference (SMEI), CA World, TechData/TechSelect Member Conferences, Ingram Micro’s XChange Conferences, SAP Partner Conference, SolidWorks World, Gartner IT Visionshare, CompTIA BreakAway, and NASBA Management Academy. He has authored two books and many articles spanning a variety of sales management topics, which have appeared in Personal Selling Power, VARBusiness, Reseller Management, Business Products Professional and SmartReseller. He is currently a columnist for Redmond Channel Partner Magazine.
Popularity: 44% [?]
3 Simple Rules To Keep Your Quality Sales People
Quality sales people in perceived “difficult” times often get tempted to go to the highest bidder.
When times become challenging great sales people and sales managers are in demand.
Managing people in general can be a daunting task.
Managing sales people can be even more challenging. Particularly if this is the first team you have ever managed. Though they may seem obvious some basic principles can help to keep you on the right track.
Sales teams are expensive to run. However when everything is working well and you keep the great sales women and men and have an awesome team you realise it is money well spent.
This only happens with work. Yep ideally you will get help from your manager and your organisation. However think through what you do and how you can make your team the one everyone wants to work with.
Remember over 70% of sales people leave an organisation because of poor relationships with their immediate superior. That’s you by the way!
Internally, you need to provide a positive working environment. You can do this by adapting the following principles in managing sales people:
1. Conduct a regular sales meeting with your team
In our line of business, you might not see your team eight hours a day. They are ideally busy out and about seeing clients and customers.
Therefore, make sure that you schedule a regular meeting. This is the best option for you to ask how their days were, how the sales call went. This should be as a team and also individually. Meeting with one of your sales people should be a planned event. Plan it in your diary so it happens. Time spent coaching your team is the best possible investment
The quality time you spend with them the better they will perform. Sales coaching and development is one of the fast growing areas. Why because it works and can demonstrate measurable results.
2. Have an interesting and worth while reward system
Managing sales people includes creating a reward system that’s delivers its outcome. That is to motivate your sales staff and reward them for the performance and effort they put in.
More than the basic compensation, along with development what keeps sales people is the kind of perks and attention that they receive.
This could be anything from the number of day’s holiday. Staff discounts. flexible working hours, upgraded IT equipment. Think about the kind of market you are in. What age group are your sales people? Increased pensions might not be important to a 25 year old though holiday vouchers certainly will be.
In cooperation with your Human Resources team, you might be able to come up with a reward system that is intrinsically equitable and externally competitive. With this in place, you are sure that you’ll stand a much better chance of keeping your quality sales people
3. Keep performance evaluation transparent
Everyone in your team must understand how they are evaluated and should feel that they are fairly rated. In managing sales people, you need to show them that their performance is transparently being measured. This way, all of you are on the same page as to how you draw the line between the top and average sellers. Understanding the evaluation process is motivation enough for them.
To you and your teams success,
Sharon and Denise
Popularity: 29% [?]
Setting Expectations for Sales Teams in 2009
Setting Expectations for Sales Teams in 2009. Having read last weeks posts about possibility, you might be thinking, ‘how do you set expectations?’ Well now, it might be more different than you think.
One thing often missing in sales manager training courses is the section on expectations. No not the normal definition of expectations. I am talking about the one that can really change your sales performance in a drastic way.
There is a great saying in life. “That you get what you expect not what you want”. Now some of us in the tough, business world probably think this is not true. Especially in the fast paced world of a sales manager.
The current vogue of personal development; The Secret and its explanation of the law of attraction LOA has put a whole new light on the so called metaphysical world and how this can relate to business.
Life is actually governed by a number of universal laws wether we like it or not. The law of cause and effect being the most well known and accepted particulary by sales people and their managers.
There is a growing body of evidence to prove this theory. Have a look in any book store and you will see an array of books on quantum physics, the power of positive thinking etc. An interesting fact that The Secret has remained on the best seller list on Amazon for the last couple of years.
Expectations are all part of the attraction cycle that most of us set up unknowingly in our life. You often get what you truly expect. There have been a number of studies conducted where instructors are fed false information about the team they are coaching. The results really are not that surprising.
The instructor who thought his team had the highest skill level , from false information he was fed then treats them accordingly.
The result is superior results when in essence the team had the lowest skill level of all. Expectations therefore can really be a self fulfilling prophesy.
The same is so true in the business world and especially sales. Generally sales managers allocate resources to their team members in proportion to their expectation of them. Now we are not just talking about money here. Think of the other and actually more powerful resources that involve sales coaching, attention and encouragement to name but a few.
The ones they expect the most from get the most emotional support through non -verbal cues ( eye contact, smiles) frequent and valuable feedback and development. Along with surprisingly, challenging goals.
This starts a cycle. The sales team has more confidence, better support and encouragement and guess what they perform better. A positive belief has been installed with the corresponding positive result.
So the message for sales managers is expect great things. Tell your sales team verbally and in writing that you believe in them. Be realistic of course. Great expectations are good. Outrageous ones can be demoralising.
Oh one more thing. This expectation strategy works for you as well. How about expecting great things. It just might work for you as well.
To you and your teams success,
Denise
Popularity: 31% [?]
Want to Be A Sales Manager? Is This The job For You
Sales Management? Is it really the job for you. A question you might be asking yourself right now. Or perhaps you asked it a few months ago and are now in the middle of an exciting yet what feels like a stressful time ?
Fact : Great sales managers either make or break a team. Yes its true and there is a lot of evidence to prove it. A sales manager that is focussed, passionate understands people, business, and how to leverage the two can put thousands on the bottom line of her or his company.
Have a look at the video and post your comments. More importantly though let us know the 3 reason why you think a having a free copy of our new sales coaching manual would help you and your team
To you and your teams success,
Denise and Sharon
Popularity: 39% [?]
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