When it comes to sales performance, the most successful organizations are those that understand the importance of sales execution and measurement. They are also the ones that stick to an on-going review process with the direct and active participation of business unit leaders.
Based on the Corporate Executive Board’s report, Metrics for Measuring Sales Rep Performance, the following talent assessment and key performance indicators – supported by repeatable and predictive processes – matter most:
- Activity – e.g., Number of calls and meetings per week or client face-to-face time
- Sales volume – e.g., Revenue volume in dollars or units, Revenue by customer segment
- Market share – e.g., Percentage increase in market share
- Profit – e.g., Gross margin percentage, Gross margin dollars
- Personal Development Goals – e.g., Completion of specific training
- Individual Objectives – e.g., Number of qualified sales closed, Pipeline size
- Customer satisfaction – e.g., Customer retention
Whatever the agreed-upon measures, it is vital that they are consistently measured and tracked to optimize sales performance and organizational effectiveness. It is also important to focus on lead measurements, which is far easier to do in a sales environment compared with other functions.
Why is this so important and why now? As highlighted in a 2011 Aberdeen survey, sales performance is at the core of executives’ priorities. In fact, over one-half of the respondents indicated that profits and visibility were among the top two corporate goals.
If the above is true in growth periods, it is even more essential under market pressure. Best-in-class companies focus on creating an environment that is most conducive to sales success. Utilizing appropriate talent management planning tools, measuring performance against goals, and bringing sales people into the review and planning process will create the focus, commitment, and culture that deliver world-class sales results.
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Sales Performance and Talent Management Strategies
This is all part of the necessary alignment of the four pillars that form the basis of a strong sales culture:
- Sales talent management
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Metrics and rewards*
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Overall sales strategy and client management
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Processes and tools
* Aberdeen study: “Sales Performance Management 2012: How the Best-in-Class Optimize the Front Line to Grow the Bottom Line”
