The Criticality of SPM Technology
How critical to sales success is the right SPM technology?
The answer is simple. Technology is pivotal and there are a number of perspectives that provide us with a strong impetus to make sure that SPM technology selection is both well-informed and based on a strong foundation of business case value, future state design considerations including processes and organizational governance, and ultimately a successful implementation tying it all together.
Sales Performance Management (SPM) solutions are a critical component of an organization’s core business, as it is the linkage between behavior and strategy. While, incentive compensation administration is still a main piece, the broader SPM technology concept is expanding more holistically to include other key aspects which directly impacts how a sales team might perform, including talent development, sales enablement, and territory and quota management. These all-in-on solutions make it easier for team to act more strategically by removing the administrative burdens that come with outdated and/or home-grown systems.
According to Gartner research’s 2016 Sales Performance Management Magic Quadrant, the entire industry grew 10% in 2015, reaching a valuation of $715 million just in software sales with an estimated growth to $1.54bn by 2019. The total market including all consulting and managed services is estimated to be worth $2.7bn. Sales Performance Management solutions are becoming more sophisticated with more predictive analytics, more accessible through mobile applications, more joined up and integrated. In terms of usage, Gartner specifically identify a growth in the use of SPM technology for gamification and territory management, but a big reduction on the use of appraisal solutions.
Salesforce’s 2015 research, with 2300 global sales leaders, identified some critical differences that technology makes to top sales teams. In the face of an increasingly sophisticated customer population and competitive sales environment, the research shows that high performance sales teams are more likely to use predictive analytics leading to a 53% increase in sales, more than twice as likely to use mobile technology to support the selling process and more than three time as likely to use technology to support the selling process.
Aberdeen Group’s 2014 research identifies 4 SPM technology enablers adopted by Best-In-Class companies are more likely to use dashboard scorecards for managers and reps, customised sales reporting, a sales analytics or forecasting solution and geographic sales coverage, territory management/optimization or location intelligence solution.
Steps to Success
From our experience of managing over 1200 successful technology deployments, we know that it is critical to follow an objective and rigorous process:
- Assess your current capability across the whole of SPM as a foundation to determine the key pain points/challenges or areas of missing technology linking these critical processes across the SPM continuum.
- Have a clear vision of the Future State you desire to achieve – SPM technology is the enabler, but the design, process, and approach needs to be aligned.
- Ensure that incentive plan design is optimal to drive and reward the right behaviors based on roles (i.e. direct seller vs. channel overlay) from your sales team and modeled expected outcomes.
- Establish a realistic business case – We commonly see organizations who have a robust platform that is much bigger than what is needed to achieve desired results.
- Have a rigorous vendor selection process – This is a multi-year investment, requiring the right planning upfront to identify those critical differentiating use cases helping to guide you to the optimal solution.
- Make sure that a structured change management process is used to support a technology implementation to ensure stakeholder buy-in and ROI realization.
The opportunity to invest and the quality of SPM solutions available in the marketplace is continuously growing. The potential for SPM investment ROI remains significant as technology and capability development improves sales behavior alignment with strategy and operational efficiency. On the flipside, the cost of getting software and services selection wrong can be equally significant as ROI remains unrealized and difficult technology deployment hinders sales effectiveness.
The 2016 Sales Performance Management Vendor Guide
Through the 2016 SPM Vendor Guide, to be found on our Resource Center, our purpose is to improve the quality of information available to enable businesses to make the right investment decisions. As well as the company profile data, we have included an outline of key OpenSymmetry’s Strategic Services, which help to guide the organization in business case development, vendor selection and ROI realization.
This year’s edition features organizations that provide software and services across the whole spectrum of SPM. As mentioned early, some vendors provide solutions across the whole SPM breadth of talent acquisition, talent development, sales process, territory and quota management (TQM) and incentive compensation management (ICM). Others provide solutions in just one aspect.
As an independent adviser we do not pass judgement on the pros and cons of each solution in this guide as we strongly believe an organization’s specific critical use cases from integration to workflow to modelling capabilities shape the direction towards the optimal platform for meeting their needs. From the myriad number of providers available, we have selected what we consider to be an objective selection of the key vendors. We are most keen to make sure businesses make the right selection in the right way with a transparent understanding of business case/ROI, a practical and achievable roadmap and a realistic Future State to maximise your sales performance.