The binding pillar of any organization that completes the entire thread of production, development and consumption can be regarded as the Sales Team. This team of people are responsible for bringing in revenue and connecting the organization’s services with customers in need. This skilled set of people helps achieve organisational goals and objectives; and while the entire process from the sales pitch to potential customers, to final sales with those customers, can involve a few steps, new software in the market is here to revolutionize it all.
Sales Performance Management: What is it and Why is it Important
Sales Performance Management (SPM) is an organisation’s specialised software to strategize, manage and analyse individual and teams’ overall sales performance and drive operational efficiency across end-to-end sales processes. With SPM software, the planning of sales target is optimised, and various back-office operational sales process is automated thus help managing quotas and incentive compensation plans. Along with it, the platform leverages AI\ML capability to help organizations predict future sales.
An SPM system has been observed to be incremental to a team’s overall success. In today’s competitive market, how a sales team is bringing out a product or service is as important as what the organization is selling and a sales team with a great sales strategy is an unparalleled combination.
Here comes the need for SPM! This software allows sales leaders to effectively deploy sales strategies that envelop all functions of the sales cycle and process. With various back-office tasks (payroll, settlement, forecast and regulations) automated, sales leaders can optimize their teams’ sales performance.
According to Anish Krishnan, Analyst, Quadrant Knowledge Solutions Sales Performance Management (SPM) aims to boost operational efficiencies and productivity by standardising and computerising previously disparate back-office sales procedures. The business value of SPM can be demonstrated in several ways, the most concrete of which are its ability to streamline operations and provide compensation design and performance insights.
Components of Sales Performance Management: Where, How and What
Sales Performance Management software is built of three pillars namely, where how and what to sell and how a sales leader is aiming to optimize these objectives, indicating how the leader is planning to succeed in the specific product or service market.
Where to Sell: The first step for sales planning is market segmentation and team alignment. This segmentation includes account organization, setting quota, territory division and capacity planning. With advanced modelling, an efficient sales team can stay aware of market changes in individual accounts and regions.
How to Sell: After panning and division, there comes the process of “how” a sales team approaches their sales. Here, sales incentives and commission structure play a big role in encouraging salespeople to target specific customers for the organization’s specific products. With commission tiers and added bonuses, sales leaders encourage their teams to focus their energies in a singular direction. With an automated incentive plan, a sales team will be updated on day-to-day changes in the incentives plan, track their incentive amount and plan their strategies accordingly.
What to Sell: Sales insights are metrics that help sales leaders measure and improve their business. These measurements include pipeline management, price and discount, forecasts, and other KIPs. With SPM these indicators are easily measured, and the data helps sales teams deliver their targets for the organization. SPM filters large volumes of data to give real-time insights to sales leaders and drastically improve sales metrics.
Sales Performance Management Software: How to choose
With a variety of software available in the market, an organization should keep the following things in mind when choosing software that will help them improve their overall sales performance.
Connection Efficiency: With any organization comes to the problem of various data spread across different sources and storage spaces. This leads to operational lag leads to an increase in searching time which can be better used in connecting to prospective clients.
Sales leaders when choosing an SPM software solution should look out for ones that allow all employees in a department to work in the same platform with data visible in one click. This enables businesses to create a unified plan and helps drive decision-making at an all-time best.
Data Access: A good SPM software solution should have access to real-time data that allows a sales leader to monitor, react and plan for sudden changes in businesses and incorporate it into business objectives.
With access to real-time data, sales-territory coverage gaps can be monitored, and leaders can quickly allocate salespeople to new accounts. A competent SPM solution can also be helpful in managing incentives and compensation plans that will allow sales representatives to understand their earnings and make an overall impact. Apart from this, real-time sales forecasting through SPM can help sales teams share information with other departments like finance, supply chain and production.
Insights and Analytics: In the cut-throat market, sales leaders always need to be ahead of the competition. Here, SPM solutions with their predictive analysis cater to enterprise-wise planning and modelling. Predictive analysis allows leaders to view future scenarios and plan the best course of action. Decision-makers are able to stay ahead and strategize the optimal action for any number of circumstances.
Sales Performance Management Software: Effective Implementation
Now that our readers know how to choose the right SPM solutions for their needs, let us move on to its effective implementation.
Performance Metrics Assessment: To create an effective SPM process, the overall objectives of the sales team need to be clearly defined so that all contributors in a team are aware of their respective goals. The high-level metrics have to be understood by a team on a macro level and the performance metrics of each individual on a micro level. These performance metrics are:
- Individual Quota
- Conversion Rate
- Sales Productivity Metrics
Communication: With the performance metrics defined, these goals have to be clearly communicated to the team members. Only clear communication of business roles and objectives from the sales leader to the rest of the team members will lead to the effective implementation of the SPM software solution.
Coaching for Performance-improving skills: With objectives and performance cleared out, sales representatives near the proper tools to succeed. This will help the reps build upon the already present skill set. SPM allows sales leader to provide their team with the tools they need to meet their goals. Courses for training on an individual and team level help them develop these skills and effectively use SPM software in an efficiently way.
SPM as a Critical tool for Growth
Sales Performance Processes are imperative for the efficiency and overall effectiveness of the sales team that will help the business generate revenue. First, the performance metrics are determined and once it is communicated to the rest of the team, sales reps are coached and guided accordingly, and necessary feedback is provided.
With SPM, sales leaders can use predictive analysis, a centralised database and ease of connection that helps them stay ahead of the competition and exceed their sales goals.
Shinjini Sarkar, Senior Content Specialist at Quadrant Knowledge Solutions