3 Sales Metrics VPs Need To Improve the Efficiency
Nowadays, sales managers are more in the spotlight than ever.Let's face the fact: the belts tighten across many organizations, all departments are expected prove their efficiency, and sales process is no an exception. Being the VPs, your goal goes beyond giving the headline numbers like total revenue. You have to set up the objectives linked to the key sales metrics, as well as provide the team specific targets to hit, and actionable suggestions on where to optimize.
Unfortunately, statistics shows that over 40% of sales managers fail to reach their yearly quota. Accordingly, the main mistakes of poor leadership are the following:
- making inaccurate diagnoses of sales-related issues
- assuming channels will do the selling for you
- presenting the sink-or-swim training policy for the reps
- providing the sloppy tracking of the sales processes
- neglecting treating customers as assets
- lacking of understanding of lead generation process
- selling to the wrong audience
- pay no attention to sales metrics
Considering the last essential problem of the sales VPs failures, let’s go over the important KPIs that can reasonably gauge your future performance.
3 Ways to Getting More With Less in Sales Procedure
The efficient sales operations lead to the improving of the overall company productivity. You have to dive into the various areas of sales:
- the process,
- the people, and
- the deals.
Furthermore, it is important to know how they are engaging and where you can optimize these processes to become more successful. Explore the following sales metrics to make your team effective, as well as get more revenue out of each process, rep, and deal.
#1 Sales Cycle Length
Finding the methods to decrease the sales cycle length, you have a chance to grow your income rates faster. However, the optimization of the buyer's journey requires a deep understanding of its constituent parts. The starting point of the analysis should be breaking the cycle down into the stages with determined bottlenecks. At this stage, you will see where you’re being held up.
For example you are spending more time on the evaluation stage showing the potential customers that your product or service is a fit. Moving more prospects through this step provides a higher chance to shorten sales process.
In case it’s difficult to identify how the issues are occurring, you can also divide the cycle further between the reps. It gives an opportunity to find where each employee is spending most of the time. Different workers have different troubles at every stage. By knowing these bumping points, you can coach them how to overcome the weak areas in the sales cycle successfully.
#2 Sales Rep Win Rates
The efficiency per sales manager lays down in rep’s single win rates. It means the following: the number of won deals divided on the number of lost sales. Apart from getting more revenue per employee, this metric delivers the additional values:
Lower customer acquisition costs: by closing more deals at the same speed, you reduce this investment, and gain more profit.
Reduced overhead: depending on the compensation package and rewards for your employees, the improvement of the win rate of each sales rep can significantly lessen the cost of each other sale by that worker.
#3 Bookings Per Sales Rep
To enhance the deal efficiency means receiving more revenue out of each deal a sales rep closes. The optimization of this process implies the improving productivity of workflow and overall performance.
The larger deals usually take more time to close that may increase the length of your sales cycle. At the same time, it can be more challenging to make your prospects faster come up with a decision and buy; that can diminish the win rate. Closing several big deals enables you with the opportunity to overcome these problems and boost both bookings per rep and all business processes.
For example John Doe is far more productive than Julie Martin. Though John’s total value of closed deals is lower than Julie’s. He has accomplished this in far less amount of deals. John’s bookings per deal are ~ 25k, Julie’s ~ 5k. It means that a 5x efficiency amplifiers for John.
Apply the upmarket and strive for large deals to route your strategy and goals of the entire company to higher, measurable results. Another tip to use is to ensure that sales reps drive qualified leads through the funnel. After that, invest time in analyzing the prospects who can become larger deals. Give the staff time to cultivate the deals, and set up their objectives accordingly to achieve the maximum revenue during the shorter time.
Brief Sum Up
Now and beyond, the efficiency will drive the SaaS, and sales have to lead the way. By diving into deep analytics, you will get the full picture of the processes, and advance the team performance in both time and money with the mentioned-above sales metrics.
P.S. Learn more about the essence of CRM reporting, as well as the systematic and cost-benefit sales metrics with this free white paper “CRM Analytics Workshop Set Up Effective Metrics”.