The 5 Essential KPIs For Inside Sales
We live in the platinum age of data. There’s probably, if anything, too much of it. But more than that, we are getting smarter and smarter every day—not just about how we can measure things, but what are the best things to be measuring in the first place.
Enter KPIs. KPIs, beyond being simple benchmarks, allow us to better understand how we as a sales organization can improve. In short: what behaviors lead to the best results. And that’s why we’ve curated five essential KPIs for your inside sales organization: measurements that, from our standpoint, can lead any inside sales team to work smarter and more efficiently.
But before we dive in, one important reminder: KPIs, just like sales organizations are not one-size-fits-all. In fact, a KPI that works super well for one sales team may simply not make sense for a similar organization. That’s because we all have different products, different processes, and different people. And in the spirit of getting started, here are those KPIs you so diligently didn’t scroll down to read yet:
Average Call Time
Here’s a KPI that can give you a lot of data to make smart business decisions right off the bat: how long are your reps spending on the phone with prospects and customers?
If you’ve got high performing reps who have very low average call times, is there something that you can teach to lower performers about getting off the phone quicker? Or on the other hand, does it seem like lower performers spend less time with prospects than those that actually close sales?
Only when you have true datasets can you start to find corollaries. And once you find corollaries, then you can start to set guidance that helps everyone perform better.
Potential Revenue In Pipeline
Whether it’s a matter of simply having leads loaded and ready to pursue, it’s essential that your inside sales reps be cognizant not only of having a pipeline, but the quality of that pipeline—and furthermore how much revenue that potential could bring.
Think of it this way: are you happier with a rep who brings in $10,000 off of one sale, or a rep who makes ten sales totaling $5,000?
If your goal as a business is to make a profit, you’re probably happier with the one sale. While not every customer will close, tracking the potential value of every opportunity helps salespeople identify exactly how much the company (and themselves) can make. Knowing that a sale has a higher potential revenue helps each employee prioritize.
This transforms your team from simply thinking about closing sales, to making the best use of every potential sales—wasting less time on hunting down the smallest fish just to check a box.
Simply put, activity efficiency measures how many different activities (emails, phone calls, etc.) it takes to turn a prospect into a customer.
An essential study from Insight Squared tells us, “While measuring the number of activities your reps perform gives you a baseline understanding of their effort and productivity, tracking efficiency ratios is much more important because it shows you the downstream conversion rates of these activities, such as how many dials it takes your reps to source a single opportunity.”
In other words, maybe phone calls are a waste of time where an email or two can get someone’s attention much faster. Remember: it’s about working smarter, not harder.
Sophia Bernazzani raises a fundamental issue when she says that “It’s important to look at the big picture of a customer … Are they actually seeing value from your product or service?”
She goes on to point out that care for customers isn’t just about inking a contract—it’s about helping them to maximize your product long after you close the initial sale: “reps need to ensure that their customers are not only surviving, but thriving with their product. They must follow up with clients, offer assistance with problems, and help them proactively strategize for the future.”
If you’re in the business of holding on to contracts for the long-haul, it’s essential that you’re tracking client engagement beyond the “first date.” Are your customers still happy? Who’s to truly know if your reps aren’t taking the time to actually engage their clients?
This, in many ways, is one of the most actionable KPIs you can apply to your team. It’s something that’s going to help you truly take your team’s temperature, and allows you to dig into layers that might not have otherwise occurred to you.
Conversion Rate, often known as Client Acquisition Rate, is essential how often your inside sales reps are turning prospects into customers. Are they converting one prospect every ten calls? One for every one hundred? Any answer immediately opens the door to smart, tangible questions.
As Richard April reminds us, “ It’s natural for some salespeople to perform better than others — but if there are large discrepancies between conversion rates, dig deeper.”
Let’s say you’ve got sales rep A who can convert one in every twenty prospects, and sales rep B who’s converting one in every four. The primary conclusion might just be that Rep B is just a better saleswoman than Rep A. But upon investigation, you realize that the territory Rep B is covering naturally has a lot more qualified leads—or maybe you discover that rep A hasn’t been following proper sales guidance. By analyzing this KPI, you’re now able to correct the mistakes Rep A is making, rather than simply seeing that one rep’s numbers are lower than another and letting that low performer flounder.
In all of this, remember that KPIs are supposed to work for your team, not the other way around. Maybe you’ll find that these five are exactly what you need to jumpstart your team’s performance, or maybe just one of them works for you. Whatever the case, start digging into the data: you’ll be surprised what you can find out.
The 8 Essential KPIs For Customer Service Reps
Customer service doesn’t always have the best rep. Like many an unsung hero of any industry—like the person who operates the reel at a movie theater—we don’t often talk about customer service unless something’s wrong. At least, that’s how it feels.
The good news is that, given how poor of a reputation that side of the business gets, people will also always talk about customer service when it’s really good. People tend to notice great customer service—and call it out. Like JetBlue’s twitter, for example.
But it’s about more than just some fancy tweet-work. There are ways that you can actually monitor your reps—and help them to better understand what it takes to be Jet-level great: start tracking KPIs.
If you’re looking to dial in your customer service reps to ensure that you’re giving your customers the best experience possible, check out these essential KPIs that you can start tracking today.
Customer Satisfaction Score (CSAT)
For many folks, this is the number one most important question to be asking any customer: “Were you satisfied with your experience?”
At the end of the day, everyone’s going to experience a hiccup in a product or service—that’s not the sign of a bad organization. The problem comes when they can’t get the help they need. If your CSAT is low, it’s a canary in the coal mine.
Often your CSAT score is the first place that you might go to start diagnosing problems within your organization. From there, you can dig into different KPIs to get a closer look at problem areas.
Average Response Time
When you think of a typical customer service experience in your own life, you probably think of one standout moment in particular: being on hold.
Average Response Time essentially boils down to how quickly you’ve got a rep interfacing with a customer after they try to get in contact with you.
If you’ve noticed that your average response time is high, it means you’ve also likely got a lot of unhappy customers waiting on the other side.
Net Promoter Score
While this may sound very data-scientific, an NPS can be summed up in a simple question: “How likely are you to recommend this product or service?”
Your net score is then based on subtracting the percentage of “non-promoters” from the percentage of promoters.
As should be self-evident, word-of-mouth is worth its weight in gold. Don’t underestimate the value of reps who inspire people to evangelize on your behalf!
Number of Support Tickets
You can track support tickets in a number of different ways, but what may be most helpful is to assess how many a rep is able to fulfill on a daily or weekly basis.
Given the number of issues that can arise for a rep, not all of them may be able to be resolved as quickly as others. But what tracking this KPI allows is to show how reps, on average, compare to their peers across any given period of time. This allows both some healthy competition, and the chance for reps to see what it looks like to really excel.
More than just a sad, sad, meme, the trope of “can I speak to your manager” is a very real experience for most customer service reps. And it’s going to happen to everyone eventually. It’s not the sign of a bad rep—we all have to deal with a tough customer from time to time.
But if you see that tickets are regularly being escalated for either a) a similar issue across multiple reps, or b) the same rep for any number of issues, then you can clearly address the problem: either you’ve got a rep who doesn’t know how to problem solve, or an issue that needs further addressing on your back end.
And just like you want a low escalation rate for you reps, you also want to see a high resolution rate: how often they are able to solve a customer’s problem.
Resolution rate, as you’ll find, is something that’s often directly tied to the CSAT score, because ultimately that’s what people are coming to you for. And this can quickly be the first KPI that you go to when you need to further investigate a low customer satisfaction rate. If the CSAT score is low, but the resolution rate is high, then it’s probably not your customer service that’s driving away customers—it’s something more seriously tied to the quality of your product or service.
Average Resolution Time
Slightly different from resolution rate is the average time that it takes to resolve the issue itself. So you may, for example, have two reps with a 98% resolution rate, but for one of those reps the average resolution time is five minutes, and for the other it’s fifteen. While both have a great resolution rate, you can already see the problem: one rep’s slow time to resolve is probably going to lead to more people being on hold for longer, ultimately hurting your average response time.
Lastly, we wanted to address a KPI that often gets overlooked in the customer service world: occupancy.
Occupancy, in short, is how much time an employee spends on their main task. If a customer service rep never took time off for lunch, forewent breaks, and somehow managed to sneak bathroom stops in while they were handling issues, their occupancy would be 100%.
For that reason (and a few more), what we want to stress is that striving for 100% occupancy is a terrible idea. While in a dystopian world of robots and “efficiency” obsession, that sort of non-human excellence might seem like a positive thing for your bottom line, it’s a terrible thing for employee retention, because it leads to lower employee engagement.
Employees need to feel valued and balanced in their work. They need time for training, to reorient their minds, and to stretch themselves outside of a singular task. Otherwise they’ll start to become disengaged, lose their sense of meaning in their work—and ultimately leave. And as we all know, it’s a lot cheaper to keep employees than to replace them.
While KPIs are a great tool to diagnose problems, and even make your organization the best it can be, don’t forget about the importance of empowering and engaging your employees to be their best. You’ll be amazed at what that kind of teamwork can accomplish.
The Most Important KPIs Your Sales Organization Should Be Tracking Right Now
When was the last time you had a performance review? In the days leading up, surely, you sat back in your chair and thought to yourself, “You know what? I’ve done a great job here. And I’m sure my boss will take my word for it!”
And then you undoubtedly waltzed into your boss’s office and said, “I’ve done a good job here. All right, review over!”
Or are we missing a few details? At every level of an organization, employees—and their managers—are viewed through a series of metrics, whether we’re calling them by that name or not. Because in the world of accounting, bottom lines, and competitors, it’s not enough to simply feel like you’ve done a good job—you have to measure it.
With that in mind, we’ve honed in on a just a small sample of the KPIs—that is, Key Performance Indicators—that are important for any sales organization to understand and analyze. With each, feel free to dive deeper into the metrics, and you’ll find that on the other side is a clear and true pathway to success.
Customer Acquisition Rates
Whether your employees are tasked with prospecting or not, this is a simple metric that any sales person can adhere to: are they turning their leads into contracts or not? That, in essence, is your Customer Acquisition Rate.
Allie Decker, writing for HubSpot, outlines exactly what Customer Acquisition Rates translate to for your business, noting quite simply that acquiring new clients “allows your business to 1) make money to meet costs, pay employees, and reinvest in growth, and 2) show evidence of traction for outside parties such as investors, partners, and influencers.”
Simply put: if you’re not consistently acquiring new customers (at a reasonable cost), your business simply cannot grow.
Existing Client Engagement
But what good is it to lock in a client once if you’re just going to lose them tomorrow, or in a month—or a year? Crudely: You could turn a cow into a cheeseburger now, or you could nurture it, breed it, and create a whole herd of meat, dairy and fertilizer-producing cattle. One of them takes a little more work, sure, but the benefits are hard to quantify.
Make sure that you’re tracking not only how many new customers you’re bringing in, but how you’re engaging with existing ones. Research shows us that existing customers are much easier to retain and upsell than prospects in the pipeline.
Don’t neglect those who are truly taking care of you!
Finally, as a manager, this should be a metric that you are relentlessly trying to improve or maintain.
The numbers simply do not lie on this one: engaged, happy employees are the consistently outperforming those who don’t feel like they have attainable goals or a place within the organization long term. If they’re not satisfied, they’re not going to be selling as well as they could be.
6 Key Selling Activities Your Team Needs To Track This Week (& The Rest Of the Quarter)
We are the sum of our actions. At least, that’s according to Aristotle. And it’s in that regard that we imagine Aristotle would have been a pretty good salesman. As any good salesperson can recognize, you won’t get results without action. But too often, it’s extremely difficult to know exactly which actions drive the most results.
You can spend plenty of time sorting through mindless emails, writing big win announcements, or even calling on prospects. But at the end of the day, none of those things will necessarily get you closer to a sale. On the other hand, you could spend an entire week checking a lot of valuable boxes, but on paper all your boss sees is that you haven’t closed any deals yet–does that put you on par with the person who did a bunch of meaningless activities this week? Certainly not. And that’s why it’s crucial that in sales–and really any industry–we have a KPI dashboard to come back to: a place where we can quantify and track the most critical activities that lead to success.
If you’re a wise builder, you put the foundation of your home on something sturdy. That’s what a lot of groundwork is in sales: building a firm foundation so that you can have a house full of deals for years to come. And if your team isn’t focused on building the right foundation, your numbers are always going to be disappointing in the long run. If you’re not sure where to start with your team, here are a few key selling activities that you need to track on your dashboard this week.
1. Time Prospecting
First and foremost, you need to have a measurable amount of time spent purely on prospecting. While this can be easily confused with simply cold-calling, or checking the box of reaching out to leads, there’s a definitive science to prospecting that is too often overlook. Consider this point from HubSpot: “Before a salesperson even has a chance to contact a prospect, he or she is already 57% of the way through the sales process.
Yet, salespeople are still cold calling as if buyers have no awareness. Experienced sales people can expect to spend 7.5 hours of cold calling to get ONE qualified appointment, according to a Baylor University study.” Time spent cold calling is not always value. Make sure your prospects are qualified, and that you’re informed going into the call.
2. Number of Leads In Your Pipeline
It can be easy to be excited about having a full pipeline week in and week out. But that’s meaningless if you’re simply tracking numbers. One Salesforce “knowledge article” shares this succinct explanation of why you need to be tracking every lead in your pipeline: “By managing your leads in a systematic and structured way, you can increase both the number of leads you generate and how many of those leads you convert.” If a lead isn’t qualified, it’s just wasting space in your pipeline. Make sure that you’re qualifying leads, and using past data to make your own pipeline ever more efficient.
3. Lead Response Time
Once you’ve got someone on the hook, you don’t just automatically have their attention forever. In fact, one of the biggest problems companies face in their ability to drive sales is the time it takes to follow up with someone once they’ve identified as a lead. It’s almost as if a salesperson’s natural instinct is to feel relief once they know someone is a lead, rather than urgency. On this, it’s important that you’re tracking your average lead response time in a way that drives that sense of urgency–so that you’re not letting days and days pass before you follow up. The simple truth is, the sooner you follow up, the better chance you have of capitalizing on your new lead’s enthusiasm.
4. Average Sales Cycle
No customer is identical. While there are certainly going to be similarities in each sale you make, you know better than most that every case is going to be different. Budget issues take hold, procurement drags their feet, or someone else comes in to make the decision that you didn’t know about. Having an “average sales cycle” metric can in many ways feel forced, right? But the reason this is so important is because you need a benchmark to know when you’re spending time chasing the right deals, and when you may be investing too much time in a small fish. While it always feels good to get the win, sometimes it’s better to cut your losses and pick a new river.
5. Average New Deal Size
Average new deal size is one of the metrics that Harvard Business Review identifies as most important to any sales organization. For any company focused on growth–which should, well, be every company–understanding average new deal size is going to be your best weather balloon. As you face questions about internal restructuring, new strategies going forward, or what new sort of engagement initiatives you want to invest in for your team, this becomes your thermometer for what’s working and what isn’t. If the average new deal size for any team or division is up or down, it’s going to help you to understand where your attack plan is working, and where you may need more work.
6. Opportunity Win Rate
Finally, there’s opportunity win rate. Gary Smith, a sales management consultant, says it like this: “All other things being equal, if your opportunity win rate is improving then your sales are increasing.” He says that measuring this statistic is the most effective way to increase revenue. Why? Because opportunity win rate tells us about a lot more than how much money you’re making.
It gives you insight into employee engagement, helps to set standards for training purposes, and gives you the chance to assess your best and worst performers in very direct, plain terms. Gary explains that you simply measure this by the number of opportunities gained in a month versus the opportunities lost. It’s as simple as that, and puts everyone on the same level. Measuring key selling activities like these will seem daunting at times, but when you have the right platform–and it’s one that your employees can really engage with–it’s going to take your organization’s abilities to brand new heights.
Everything You Need For The Ultimate KPI Dashboard
KPI is becoming a buzzword these days: we’re beginning to reach critical mass in terms of everything that we track, measure, report, and analyze. But does that mean KPIs don’t really matter? Hardly. They say “everything in moderation,” and the same is certainly true of KPIs. If you’re in search of the perfect KPI dashboard, that’s lesson one: less is more. We’ve mapped out a helpful guide for what great looks like, and we hope it helps you to make some smart decisions this week about the right trends to measure for your business.
Write Out Your Goals
It’s a free country–you can pretty much measure anything you want. Believe us, there’s a metric for everything. But that doesn’t necessarily mean it’s the right metric for your business. So before you even go looking for KPIs, the first thing you need to do is make sure you have tangible goals for your business. For example:
- We want to grow by 5% in the next quarter.
- We want to expand blog readership by 50% month to month.
- We want to increase our subscriber rate by 10% YoY.
Once you have tangible goals, you have a foolproof test to choose the right KPIs for your team to measure. If it’s not aligned to a goal, it’s not worth measuring.
Choose & Tailor KPIs To Your Business
Here’s the thing. It’s going to be tempting to put every single KPI you can think of into your dashboard–and the truth is, there’s probably going to be a simple justification for every single one. But don’t fall into the same trap that most companies do. If you’re measuring too many things, you’re going to be overwhelmed by numbers, and that’s going to stop you from focusing on a handful of the right things. And there’s data to back it up. According to a study from the Advanced Performance Institute, “Our research finds that less than 10% of all the metrics that are collected, analyzed and reported in businesses are ever used to inform decision-making. 90% of the metrics are wasted, or worse, used to drown people in data while they are thirsting for insights.” In fact, HubSpot’s Jesse Mawhinney recommends choosing just 4-10 KPIs. In the same post, he explains his reasoning this way: “As you begin to identify KPIs for you business you should be aware that less is almost always more. Rather than choosing dozens of metrics to measure and report on you should focus on just a few key metrics. … Quite frankly, if you try and track too many KPIs, you might as well just not track anything at all.” By having just a few solid KPIs, you can create better focus on what really matters.
Pick Your Dashboard
Once you’ve got a plan for your KPIs, and you’ve got the team on board, the most important piece of the puzzle if finding the right dashboard to actually display it. If you don’t have a smart, engaging platform on which to track and display your KPIs, it’s just going to become another useless gimmick that your employees ignore. A perfect KPI dashboard isn’t a pipe dream: it takes smart planning, careful decision making, and a product that puts the right numbers on display. If you can hit that trifecta, there’s no stopping your team from accomplishing amazing things together.
Don’t Let Your KPI Dashboard Blend Into The Wall
Can we all take a moment to agree that office settings are often a bit lackluster? I’m afraid there might’ve been a color palate somewhere out there called “corporate dull” and every organization got a free sample. Well, it doesn’t have to be this way – let’s have a little fun.
The Importance of Interaction in Real Time
But it’s not just the colors. Everything from our cubicles to messaging platforms screams “I’ve got a case of the Mondays,” and you can be sure it’s wearing people down—but more on that in a minute.
If you’re looking for a way to make a change in your office, we’ve got a couple of recommendations for where you can start. And it’s not just a matter of improving the décor: simple changes to the way you run your floor can quantifiably increase your team’s output. Here are three ways a little change can make a big difference.
Create excitement with Sales Gamification
In the sales world, it’s easy to revere the lone ranger: that rep who’s been around the block and has their sales habits set. And more than that, sales leaders are rightly wary to want to change their companies’ pay structure. But if you aren’t here’s some advice from HBR that may surprise you: When it comes to the way your sales associates hit their numbers, it’s good to experiment: “Over the past decade managers have become attuned to the value of experimentation (A/B testing, in particular); today many consumer goods companies experiment constantly to try to optimize pricing. There are important lessons to be learned from doing controlled experiments on sales reps’ pay, because the behaviors encouraged by changes in incentives can exert a large influence on a firm’s revenue.” So whether you choose to change the way you pay out accelerators, or you want to change from annual to quarterly quotas, it’s not heresy to shake things up. Try gamifying your sales team – it may just give your team the shot in the arm they needed.
Engage Teams by Sharing Numbers
Likewise, there’s a demonstrated interest from employees to have more involved and transparent managers. And one easy way to show that effort is to use a KPI dashboard to display your team’s numbers. When your team members can see how they’re doing in a given week, comparing to their peers, or even simply understand where the team is at for the month, it gives them the opportunity to take ownership of their work, and makes them feel more a part of the process.
Make Goals to Amp Your Drive
Moreover, displaying numbers can give you space to have more conversations about your team’s weekly and long-term goals. Of course, there’s plenty of value in the go-getter who gets out in front of their numbers every month, but that’s not going to help employees who aren’t engaged. Stop elevating the lone wolf. Collaboration has value, and good teamwork can motivate everyone from the top down. When you’re putting the team’s goals together, and displaying them company-wide on TVs, you’re creating an environment where a win for one is a win for all.
It doesn’t take a $1,000,000 makeover to change the entire feel of your office. Get your employees re-engaged with a KPI dashboard, and watch how your team begins to own amazing results.
Using KPIs to Identify and Solve Your Business’s Problems
No business is perfect—not even the ones that make the rounds on “Best Company”-type lists each year. Each has its flaws and challenges, but what makes them better than others is how a company confronts the obstacles it faces. Adapting Key Performance Indicators (KPIs) to reshape and solve problems is what separates great businesses from mediocre ones. But it’s important to establish the best KPIs for your company’s needs.
Put Your Aces in Their Places
Your team is what will consistently differentiate your company from the competition, but only if you’re getting the best out of them. Prior to hiring a person, employ KPIs to evaluate a candidate and where they best fit among your team. Reviewing a person’s resume is helpful to gauge their ability to keep a job, but a resume doesn’t hold all of the answers. Set up particular scenarios and questions during your interview process that will demonstrate the “street smarts” of a prospective employee. Using performance metrics to evaluate all candidates strengths will root out certain problem areas before hiring someone as well as deciding whether a candidate is better suited for a different role.
Check Your Timeline
Similarly, regular performance checks with current team members can solve (or even prevent) problems. Low sales numbers do not always translate into a staff issue. As you are aware, sales is a multistep process beginning with client recruitment. To fully understand lower-than-expected sales, you must evaluate conversion rates of each salesperson, as well as the time in between a new client is signed and places their first order. Tracking the entire process of a client relationship will indicate where there are lags and flaws. You may realize clients do not receive frequent follow up after a contract is signed or that more tenured clients operate on autopilot, without contact of their sales representatives, who could be boosting sales or simply increasing overall satisfaction. On the contrary, you may find out that sales are actually increasing overall, but you’re losing time, and therefore money, because client turnover is high. Tracking performance metrics for every aspect of your business is simple with the right technology and will prove to be a profitable investment because you’ll no longer be treating symptoms (i.e. increasing sales when revenues are low) but rather the problems themselves (like customer engagement).
Don’t Look Back
Reviewing your profit and loss statements of quarters past is helpful, but focusing in the rearview can be dangerous because they don’t evaluate the full scope of your inputs. Using KPIs to look forward and make predictions on what will affect your goals and how. KPI measurements will also dive into the specifics of whether or not a particular strategy is working. You will begin looking more critically at your successes and what drove your business in that direction and at your failures to understand what you incorrectly predicted. But as you begin to track and evaluation performance metrics, it’s important to get buy-in from your team. Creating incentives for KPI-driven behavior through game and reward systems will help change your team’s approach toward work. Though, it is equally as important to implement your KPIs slowly. The results you’ll find are likely to force changes upon your business. Analyzing the data and implementing changes at once can overload your team and lead to a strategic failure. You don’t have to perfect the process the first time around. Find what works best for your team through trial and error to be on your way to better results.
The Benefits of Tracking KPIs – Both Individually and for a Team
Key Performance Indicators (KPIs) present a tremendous opportunity for growth on the individual and company level—but oftentimes, they take work. KPIs are not usually a part of annual performance reviews, but rather are a regular way to track an employee, a team, or a company’s progress weekly or monthly. So, why invest the time into tracking something you believe you can see play out in front of you day by day? Well, KPIs are not going to tell you the result of a goal. Instead, KPIs tell you how you got there. If sales are low or attrition is high, for example, KPIs will offer an explanation. And the benefits go beyond that—here’s how your company can benefit from monitoring KPIs.
Determine Strengths (and Weaknesses)
Strengths and weaknesses can be understood through various KPIs. For an individual who is unsuccessful in increasing their client base or daily call logs, understanding where they excel and what needs improvement will be very straightforward. Perhaps someone who arrives at the office late after making visits to clients sees a drop off in returned phone calls compared to their colleagues. In a broader sense, using KPIs to debrief after a project gives a team an explicit understanding of what went well and what didn’t, making it easier to replicate successes and reduce failures by removing processes that don’t yield results. With respect to clients, some companies find it helpful to use feedback from their customers as an indicator of their strengths and opportunities.
Understand Expectations & Improve Management
We know that employees value feedback—millennials more so than most other generations. They are a group that thrives when expectations are clearly set. By outlining exactly what is expected of a person in a particular role—and what it takes to grow beyond that role—managers create a realistic roadmap toward success. KPIs help to manage with more objectivity. If everyone in a role is given a clear directive, it removes some of the personal nuance that comes with evaluating an employee’s performance. It also sets the standard for appropriate compensation. Teams who know they’re being evaluated on the same criteria are likely to be more engaged with their work and form stronger bonds amongst themselves.
Unburden Human Resources
The Human Resources department is the nucleus of any company—they make sure people are paid properly, treated fairly, and understand company policies and restrictions. But, HR managers often spend a lot of time playing catch-up if and when there is an issue with an employee or if it’s time for someone’s annual review. Addressing an underperforming employee becomes more manageable when HR knows both the expectations set for an employee, as well as their knowledge of the expectations. Tracking employee expectations through KPIs ensures that disciplinary issues comply with company policy and labor standards. During annual reviews, knowing the benchmark at which raises and promotions are given allows an HR manager enter into a meeting confidently knowing where an employee stands and why.
Increase Customer Base
Remember the strengths and weaknesses you learned about through KPI tracking? Here’s where they come in handy. Having data to present to prospective clients that backs up a company’s claims to their expertise or success instills confidence among leads who may be wavering in their decision because it is tangible proof that a company takes its work seriously and is more than just great marketing.
Advocate for More Resources
When budget time rolls around for each department, managers need a clear understanding of their inputs and outputs. Using KPIs to demonstrate areas that are over-performing and other areas that are spread thin with too little staff or money make a credible case when proposing an increased budget. On a company-wide scale, CEOs and Presidents of companies can use KPIs from each of the business’s departments when seeking more funding, either from current or prospective adventures. By painting a picture of what the company can achieve with a set of resources and how more of these resources will expand the scope of value of their work, investors can plainly see a detailed report of how their money will be used in current and future projects.
Tracking KPIs doesn’t need to be a huge project or take a lot of time and resources. Whether you’re using a CRM or tracking your metrics on Excel Sheets, integrating your reports on metric tracking software can make a world of a difference. With metrics that update automatically and goal progress shown in real time, individuals and teams can use these key performance indicators to improve progress and time spent on activities. Being able to literally see which metrics need a little more work versus which metrics could be spared for the time being gives you more clarity and lets you work toward the bigger goal.
6 Often Overlooked Sales Metrics to Track
In today’s data-driven business environment, you collect more information than ever about your sales funnel. You might see reports on everything from time on a call to the number of contacts before a sale. But what numbers actually impact performance for the modern salesperson? Should you be tracking total sales? Of course, but that’s not all you should be looking at. To get value from your data, you need to understand what metrics actually show sales improvements. Here are a few KPIs that often get ignored, but may be the most important part of any sales improvement strategy.
1. Opportunities Added/Lost
At its most basic definition, sales is all about adding to the potential customer pool. No salesperson has a 100 percent close rate, but the one adding opportunities to the pool is a valuable resource. Keep track of this by looking at your account mapping. Which of your salespeople takes the time to map out additional points of contact for a prospect? The more complete the account picture, the more you are able to shape the deal to land the new client.
2. Scheduled Sales Meetings
A low close rate might mean you need to redistribute your teams, not say goodbye to the person landing you the most selling opportunities. Remember that every sales meeting is a chance to gain a new client, so someone adept at scheduling is just as valuable as the person who closes the sale. Track this metric on a leaderboard to keep tabs on progress and celebrate wins when quotas are met.
3. Relationship Development
At its core, selling is all about building a relationship between your team and your prospects. For relationships to develop, your sales team needs to take a proactive approach to socializing with prospects. This metric could track everything from social selling activities to fleshing out individual profiles with personal details.
4. Training and Competencies
The most effective salespeople don’t just dominate on the leaderboard, they also dominate in a lot of other tasks. To get the best out of every person on your team, think about some training and competency tracking. After all, there is a lot of work that goes on behind the scenes and before you make the first call to a new prospect.
5. Total Pipeline Value
Another metric that can help determine sales goals is your total pipeline value. How much is your pipeline worth if every single prospect made a purchase? Then take a look at actual sales percentages to develop realistic targets for your teams.
6. Proposals Sent
You’re already tracking the number of meetings scheduled, but how many of those meetings progress to an actual proposal? By tracking this metric, you can see how well you are converting from one stop along your pipeline to the next. Understanding how and why prospects move through your sales funnel can give your business a big boost. You might uncover surprising bottlenecks or see how much support work some of your staff does to give the rest of the team a strong foundation. Your sales team is exactly that — a team. Tracking and displaying the right combination of metrics lets your team know that total performance is just as important as individual achievement. Closing is only part of the sales journey, and you should recognize more than just your closers.
4 KPI’s A Salesperson Should Focus On
Every step of the sales process tells us something—everything from how a salesperson approaches a new lead to how many clients renew their contract. But often when sales teams are evaluating their strategy and performance, they are looking too far into the sales process, like when a lead is ready to be converted, rather than early-stage indicators that can have a tremendous effect on a company’s bottom line. Here are four Key Performance Indicators to implement in your sales strategy:
1. Quality of Leads
When looking to garner new business, your sales and marketing teams are likely in cahoots. The collaboration between the two departments will ensure marketing dollars are only being used on quality sources. It can be assumed that sales teams are focused on their rate of conversion from leads to clients. Similarly, they’re likely considering just how long this process takes. But what may be even more important—and indicative in the ROI and speed rates—is the quality of the leads. It’s possible that the marketing team is focusing their energies on sources that are delivering slow, indecisive, and possibly unfit leads without realizing. By comparing the ROI of leads to the pace at which this occurs (or doesn’t occur), a salesperson will be able to distinguish the quality of the leads they’re receiving. This has a direct effect on the salesperson’s overall performance.
2. Speed of Contact
The speed it takes to close a client is not the timely performance indicator. When leads are given to a sales team, the speed at which they contact their leads is a key factor in closing a deal. If the initial speed to contact is slow, a salesperson is giving competitors the opportunity to swoop in and steal potential business. Salespeople who have a faster speed to contact are indicating their commitment to success and interest in exceeding goals previously set for them. Someone with a slow speed to contact leads may signal to a manager that sales is not the right fit for them.
3. Qualified Opportunities
Do you know how your sales team is pitching new clients? Do you care? Well, if the numbers of new clients are meeting your goals, you may start to care. Clients want to feel special and appreciate an individualized experience. Encourage your sales team to spend a little time getting to know their leads and pitch them on a more personal level. The businesses you’re pitching are likely receiving sales calls and pitches regularly, so you’ll want to stand out. If a salesperson repeated has a low ROI, question whether or not they are sending out proposals that focus on a lead’s needs or canned emails that reek of laziness.
4. Booked Revenue
Leads are great indicators for new business, but what about current accounts? A focus on booked revenue from a business that’s adding on to their existing contract or renewing their contract is equally as important. High turnover or stagnant clients is a serious red flag. Looking at current clients, it’s important to consider the length of their tenure and any adjustments to their contracts (good or bad). If your average client stays with the company for one or two years and they drop off, reevaluate the customer service and attention paid to repeat customer. This can increase revenue twofold—first by keeping a particular client on board and second by recommendations from satisfied clients. Ensuring that the helpful and ongoing level of service does not discontinue shorty after a client begins a contract will increase booked revenue. Whether you’re concerned about lagging sales or simply want to motivate your sales reps, tracking KPIs will yield positive results for your team. Utilizing a KPI dashboard that tracks and measures employee results in real time will make sure small problems do not become bigger ones and that small wins lead to larger ones.