Whether your organization is just beginning to scale or is undergoing rapid expansion into new markets, your sales team’s performance is the not so secret weapon in ensuring your growth continues. But when your attention is being pulled in a million directions, how can you manage your sales team’s performance effectively and efficiently?
Cue the help of sales performance management (SPM) and the tools that make it possible. In this article, we’ll go beyond defining sales performance management and the benefits it brings to sales leadership teams. We’ll dive into four tips for how your organization can utilize AI-driven tools to help your leadership team optimize sales revenue and propel organizational growth.
Sales performance management (SPM) is the process of utilizing data to actively monitor and iterate the performance of the sales pipeline to reach and grow the organization’s sales revenue. SPM is a multifaceted process. It requires your organization to continuously assess sales targets and strategies, analyze leading indicators, forecast trends and outcomes, and incentivize your sales team.
Today’s markets are becoming increasingly competitive, meaning that how your company brings your product to those markets is just as important as the product itself. Therefore you must invest not just in developing your product, but in developing your product’s sales strategy and performance management process.
Without the right tools, implementing a holistic SPM process can be overwhelming. Just as the products and resources for developing products are quickly changing, the products for sales performance management are evolving with the help of machine learning and artificial intelligence.
Leveraging operational and analytical technology improves the efficiency and effectiveness of your sales team. As technology continues to evolve, the best sales performance management tools go beyond automating the data collection and reporting processes.
Investing in the right SPM tools pays out in dividends for your organization:
Accelerates each rep’s sales velocity. Isolating the activities of your top performers allows your sales managers to write the sales playbook, set benchmarks, and coach their teams to help each rep optimize their potential.
A robust sales performance management process requires a continuous feedback loop that monitors, analyzes, forecasts, and actively manages pipeline performance. It may seem time intensive (or nearly impossible) to ask your sales managers to continuously monitor and manage a growing sales pipeline, but sales performance management tools can help them maximize their limited time.
With AI-powered views of sales performance, a dedicated coaching workflow, and complete visibility into what’s working (and what isn’t), SPM products like Sales Solution from People.ai help your sales managers keep a pulse on reps’ activities and outcomes. Moreover, they help your sales managers avoid getting lost in a sea of metrics and instead focus on taking meaningful action informed by the right data at the right time.
At some organizations, it can take weeks or even months for reps to know where their performance stands in relation to their quotas and benchmarks — many times reps don’t know their performance data until the end of the quarter when it’s too late to take corrective action. In other cases, managers may have little to no insight into their reps’ daily activities. This lack of performance transparency and limited visibility can unnecessarily elongate the sales process.
By giving your managers and reps real time data, you will enable the entire team to take ownership over their performance and empower individuals to use the data to their advantage. Practicing “tool transparency” — the idea that everyone should have visibility to sales performance data and tools — is a crucial way to enable your team with their own data while also promoting a culture of empowerment.
SPM products like a sales intelligence dashboard can help make sales performance metrics accessible and actionable across the entire organization. Complete, objective data within these dashboards give your sales managers a comprehensive view into their team’s capacity and utilization across individuals and territories. They also enable your sales reps to identify opportunities and triage at-risk deals so they can ultimately shorten the sales cycle.
You probably already know the importance of tracking sales performance metrics — but many organizations are not focusing on the right indicators. Key performance indicators (KPIs) should measure each individual reps’ efforts and activities in relation to the overall sales objectives.
Sales teams relying on lagging indicators like closed quota attainment, deals won or lost, and average deal size, however, are relying on past performance to inform future coaching. This is essentially using your rearview mirror to drive your car forward, when in reality you really need a reliable GPS system to guide you to your destination.
Similar to how a GPS system makes drivers aware of upcoming traffic or detours, leading indicators help guide your team towards overarching sales goals and objectives. Based on early activities that later translate into sales generation and maturity, leading indicators give you and your managers a clear roadmap of what lays ahead as well as the ability to foresee what activities drive the most impact and proactively avoid risks.
Sales intelligence dashboards help you identify and monitor your leading indicators, evaluating the inputs from your data to predict the output of your team to help make sales — and therefore revenue — more predictable.
With limited visibility into reps’ daily activities, sales managers can struggle to integrate themselves quickly into their reps’ day to day. Are email response rates low? Are most deals lost around the same stage of the funnel? Without the right tools to provide these insights, at best reps may provide self generated sales reports to sales managers, but this often paints an inaccurate picture.
The best tools provide unbiased data to help your sales managers regularly integrate into their reps’ day to day to answer those questions and also identify coaching opportunities to help reps when they need it most. Identifying who is on track and where reps are stuck before one on one meetings allows your sales managers to coach teams without micromanaging.
Further, when your sales managers know how their reps are spending their time, coaching sessions can focus on the effectiveness of an activity rather than the activity itself. Iterating and testing variables to see how they may influence a specific desired outcome is a core guiding principle for the most innovative sales teams. Continuous iteration leads to refining the most efficient and effective process across the sales teams.
So how do you iterate and test to influence outcomes? Reviewing the early activities via those leading indicators allows your sales managers to coach their teams on how to adapt and iterate to influence outcomes.
If your sales manager realizes one rep is meeting their email quota but has a low response rate, they can focus on testing the overall messaging or the targeting in their emails. If another rep is losing most deals shortly after the first meeting, the sales manager can suggest asking more targeted scoping questions in initial meetings to better understand the organization’s primary challenges and pain points. This in turn helps reps refine their activities to reduce inefficiencies and optimize their outcomes.
Your sales managers have probably developed and utilized compensation systems to incentivize, motivate, and retain your top performers. The concept of sales performance management has evolved over time and the term has taken on multiple meanings. SPM was often considered equivalent to incentive compensation management (ICM). It’s important to note, however, ICM is just one component under the much larger SPM umbrella.
SPM is not about just incentivizing your top reps; it’s also not just closing the quota attainment gap between the top and bottom performers. Rather, the focus for your sales managers should be on moving the middle — your core, average performers — up to maximize your team’s overall performance.
So how do you move the middle performers? Focusing on the behaviors of the highest performers allows your sales managers to isolate the specific activities that separate the top sales reps from the middle of the pack. Gaining that visibility allows your sales managers to write the playbook, set benchmarks, and coach accordingly — thereby increasing each rep’s sales velocity.
The rise of artificial intelligence, machine learning, and big data is changing the way companies do just about everything, including sales. While it’s nearly impossible to keep up to speed with every new strategy or tool, it’s crucial to find software to manage your sales performance that does stay on the cutting edge.
Gone are the days of simply compiling and filtering through sales data to create quarterly reports with lagging indicators. In today’s fast paced markets, sales performance management software must transform data into strategic insights in real time. But what about tomorrow’s SPM tools?
Bridging the gap between account based marketing and account based selling, out of the box best practices offering objective guiding principles, and data-informed sales organizational structures are just a few of the things the future may hold for SPM software.