Key Indicators of Future Sales Performance
Each market sector has unique growth challenges – high competition, increasing regulation, and changing buying patterns from savvy customers. With that in mind, how do you ensure that your sales strategy is not an empty promise of success?
The answer lies in being better informed about your capabilities, being holistic in your approach, and developing the capabilities to enable your employees to deliver the required change. Holistically, you need to look across the breadth of Sales Performance Management (SPM) to identify the areas that are working well or not so well, including talent acquisition, development, the sales process, territory and quota, and comp plan design and administration.
This all begins by taking note of the key indicators of future sales performance. In this blog, we discuss what signals to look for and how to change course proactively.
Indicators of future sales performance problems
The indicators that problems are on the horizon are easily recognizable. Some may include:
- Reps spending too much time on non-selling activities
- Disputes over commission results
- High sales rep turnover
- Difficulty recruiting
- Missed sales quotas
- Lost accounts
- Too many sales promotions and discounts to close deals
On the other hand, we know when the return on investment (ROI) for sales performance is positive – faster growth, shorter sales cycles, lower turnover, and more sales reps making quota is achieved.
Levels of sales performance indicators
Look at success on three levels of indicators:
- Core Level: track the metrics that show whether your SPM setup is optimal – commission payment error rates, operational costs, high regulatory compliance, high salesforce engagement and quota achievement.
- Operational Level: track those aspects that show you can manage change – things like the ability to launch new products quickly, deliver new incentive plans on time, and set quotas timely and accurately.
- Strategic Level: track those metrics that show sales plans are delivering target performance – revenue, profitability, market share, and customer loyalty.
Sub-optimal performance at any level prevents the sales organization from achieving effective results. To reach your desired future state, invest in better SPM technology, a smarter incentive compensation management process, and Business Intelligence (BI). A value grid analysis can enable companies to build an achievable roadmap to the desired future state.
Proactive change management
In order to ensure that your change project can deliver the expected ROI, here are two steps to take before launch:
- Understand how stakeholders are going to view the change – some will be active, some passive in their support or opposition to change. The more active, negative stakeholder groups will need the most focus. Those lines of business that fall into this category typically the Information Technology (IT) department that built the legacy system the business has outgrown or the sales operations team that fears for their jobs, regardless of business line, they will need the most change support.
- Ensure you have the right level of change capacity – this includes resources, communication strategies, and training tools to mitigate any risk. Change is a long haul, not a quick fix, so it requires executive sponsorship, a structured approach, resilience, stamina and a clear vision of where you are going.
Given the potential increase in revenue, profitability, and growth, it is worth the effort to plan for future success with a structural approach to deliver sales promises.