Sales KPIs: Are You Tracking the Right Metrics?
Tracking Sales KPIs
Revenue. It’s the only sales metric that matters. Right? Wrong.
Sales Key Performance Indicators (KPIs) are a great way to measure the performance of your team. To be effective, a KPI needs to be relevant to your sales process. Although sales revenue ultimately determines if a manager and their team are successful, in today’s data-driven sales world managers have a variety of metrics they can use to manage and measure their team.
Think about the wealth of data available just from listening to and recording your sales teams’ phone calls. As Peter Drucker says, “You can’t manage what you can’t measure.”
How Accurate is Your CRM When it Comes to Measuring Sales KPIs?
Many sales managers have a system to tracking their team’s key performance indicators and metrics to their pipeline and sales cycle. Reps enter their activity and accounts into CRM software, and managers follow up with regular phone calls and face-to-face meetings whenever the whole team is in town.
But can you be sure that you have an accurate understanding of your entire team’s performance and efforts?
Up to 40% of manually entered CRM data can be inaccurate and subjective. This means there’s a good chance managers are missing something.
Sales Managers: Accuracy is Critical.
A study by Demand Gen found that 85% of businesses operate CRM systems (or sales force automation databases) with between 10% and 40% bad records.
A second report from Experian Data Quality study shows inaccurate data has a direct impact on the bottom line of 88% of companies, with an average business losing 12% of its revenue due to inaccurate data.
If inaccurate data is causing so many businesses to lose significant revenue, how did it get there in the first place? The answer is simple. People and the continued adoption of antiquated sales management tools and techniques put it there.
The answer to changing this? Emphasize accuracy, get a competitive advantage, and turn data into 100% accurate, actionable intelligence to optimize your sales team.
Determine Which Sales KPIs Matter Most
There are hundreds of sales KPIs that managers could measure and track to gauge rep performance and overall team effectiveness. The metrics you focus on should be the metrics where incremental improvements will deliver the most value for your investment.
Here are three steps that will help you measure your sales effectiveness:
- Establish a sales performance baseline for each rep. Collect their activity data for 90 days to get a feel for your sales cycle and the habits of your reps. Arguably, this is the hardest step, but it doesn’t have to be: it’s a lot easier with a sales performance management tool. Reps can make calls as they normally would while the system automatically gathers activity data and reports it back into easy to consume, web-based dashboards.
- Describe in as much detail as possible what your top performers are doing that other reps aren’t. This step will help to establish a benchmark for what a successful rep looks like and coach to those standards. Simple follow-up conversations can help flush out many of the details – maybe an underperforming rep is taking the same actions but hasn’t mastered the right delivery.
- Listen to voice recordings and set up training and coaching based on what you are hearing in the individual rep’s conversations. It’s easier to have a meaningful discussion regarding a rep’s numbers when the conversation starts with accurate data and not just a hunch.
Optimizing Sales Performance
On-demand, accurate sales activity data can enable managers to answer the important questions they need to know to optimize team performance.
Here are some questions our clients have answered with such data:
- What language/which scripts get the most positive responses from prospects?
- How many calls does it take to land an appointment? More than two but usually less than 15 – that’s when prospects can become agitated and opt-out of future correspondence.
- What time of the day or which day of the week are your prospects most receptive to your calls?
- What follow-up actions do your reps take that result in the most deals? Following up a demo with relevant reading material aimed to help a prospect get internal buy-in does the most to land a second meeting.
Learn how Gryphon can help your organization improve your team’s sales performance and track the KPIs that matter most to you.