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Frequently asked questions for sales effectiveness
How do you define sales effectiveness?
Sales effectiveness is defined by the ability to align business strategy and market focus to execute revenue growth. It requires a model that addresses go-to-market strategy, operating model and structure, sales roles and talent strategy, performance and productivity, and implementation and support.
At a time when sellers have immense pressure to close deals with limited time to engage customers, sales effectiveness is critical.
How do you measure sales effectiveness?
Sales effectiveness is a collection of metrics that, when put together, give you a complete measurement of your overall sales performance, and of individual salespeople.
Your metrics should mostly be objective, meaning that they’re easy to measure accurately, using precise numbers, such as win rates, quota attainment, revenue, sell cycle length or deal size. But combining objective indicators with subjective metrics, such as anecdotal evidence and verbal feedback, adds useful context to the numerical evidence that you gather, so we recommend that you collect both.
It is also important to use leading indicators rather than relying exclusively on lagging metrics. Leading indicators become your organization’s early warning system: these signals tell you what results to expect, often months ahead, unlike metrics that evaluate past performance.Try tracking leading metrics that help sellers maximize their selling time, such as these:
- Reduction in the time that sellers spend searching for content
- Conversion rates between phases of the customer’s journey (which leads convert into opportunities)
- Selling time
- Ramp-up time for new sellers
- Ratio of first contact to follow-up meetings
- Number of buyer contact attempts required
- Ratio of marketing-qualified leads to sales-accepted leads
- Buyer email response rates
- Open rates for content shared with prospects and customers
Sales organizations measure these metrics in different ways. For example, conversion rate could be tracked by the volume of leads that turned into an opportunity within a time frame or the financial value of leads that turned into a buying customer within a particular period.
What are the seven components of sales effectiveness?
1. Go-to-market strategy
Your overall go-to-market sales plan is the architectural blueprint for sales effectiveness. Done correctly, it specifically identifies what products and services you are going to sell, what customers you are going to target, and how you will build a sales strategy to match your products to your customers in an effective way.
2. Sales structure and processes
The alignment of sales structures and processes to the go-to-market approach is an essential building block in sales effectiveness. The impact of getting this right is clear: businesses that have a defined, dynamic sales process that aligns with their organizational structure have17% higher win rates and 11% higher quota attainment.
3. A consistent, proven sales methodology
In a chaotic, rapidly changing market, where buyers are less reliant on sellers than ever before, your sales organization needs a consistent, methodical approach to reach reluctant, demanding buyers and to win more complex deals. It’s critical that sellers know how to engage with potential buying influences, as six or more decision makers often play a role in every deal. The numbers bear out the importance of sales methodology in effective selling: more than three quarters of top sellers use a formal sales methodology to engage their customers.
4. Right people in the right roles
The right talent makes all the difference to driving sales effectiveness. Leading organizations are taking three steps to future-proof their sales talent. First, they invest time in identifying the traits and competencies that have become more prominent because of shifting trends. Second, they use talent assessments to evaluate their current teams, new hires and redeployments against this agreed profile for success; and third, they make a plan to close the talent gap.
5. Ongoing sales training and coaching programs
Sales training and coaching are essential to delivering results—especially in an environment where the skill and mindset requirements are changing, and for organizations skeptical about whether they have the right talent to succeed. When organizations follow a formal or dynamic coaching program that reinforces their sales methodology and process, their win rates increase by 16%.
6. The right sales compensation plans
Your sales compensation plan needs to do three things in order to drive sales effectiveness. First, it must link to your sales objectives, so it’s meaningful to sellers. Second, it must be cost-effective while rewarding your sellers appropriately for their performance. Third, it must be easy to understand, so your sellers know what they have to do, and why, to optimize their compensation. When all three of these components are in place, you’ll raise the morale of your sales team and retain your highest performers.
7. Effective sales technology
Sales technology isn’t just a nice to have; it’s essential to improving win rates and driving sales effectiveness. By tapping into the right sales analytics, organizations with formal sales processes boost their win rates by 13%.
What is the role of sales enablement in driving sales effectiveness?
Sales enablement is a strategic, collaborative discipline designed to increase predictable sales results by providing consistent, scalable enablement services that allow customer-facing professionals and their managers to add value in every customer interaction.
As a strategic and collaborative company initiative, enablement brings together the people and resources necessary to provide content, training and coaching services to internal customer-facing audiences in a way that aligns with the customer journey.
The goal of sales enablement is to drive sales effectiveness by providing sellers and other customer-facing employees with relevant insights whenever the customer interacts with the organization. These employees directly benefit from sales enablement, while managers benefit from improvements in the coaching process.
What is the impact of sales technology on your sales organization?
World-class sales technology changes seller behavior and generates measurable revenue improvement for sales organizations. In the same way that other technologies are transforming the modern workplace, the right sales technology disrupts outdated selling routines and enables sellers to compete more effectively in the global marketplace.
There are many different types of technologies at play in today’s sales industry. But unlike other solutions, sales technology directly impacts selling activities. Authentic sales technology improves sellers’ ability to win deals and empowers managers and sales leaders to more effectively coach and manage their sales force.
Increasingly, sales organizations recognize that technology can’t exist in isolation. Advanced sales technologies integrate with the sales process and strengthen the organization’s sales framework by incentivizing sellers to use technology in their daily routines.
Additionally, the availability of large amounts of data is driving the adoption of sales analytics platforms that deliver actionable insights to sales teams. By leveraging the power of data, leading sales organizations can identify specific actions that increase the likelihood of a sale and replicate winning behaviors across the sales force.
What is an effective sales organization structure?
The success of any sales force depends, in part, on the strength and suitability of its organizational structure. However, many companies struggle to find the optimum structure – one that balances collaboration, efficiency, cost sensitivities and customer needs while maintaining a continued focus on sustainable, profitable growth. The results of this failure can be serious and will often lead to internal conflict and loss of productivity.
Key elements that all successful sales forces have in common is that they are organized around the customer and the customer’s needs, that their sales process maximizes the customer’s buying potential, and that they are able to deploy their most qualified resources to the areas of highest potential.
Key questions to answer when evaluating your sales organization structure include:
- What is the best sales structure to help support the sales strategy?
- How will sales resources be most effectively deployed?
- What are the most appropriate distribution channels and how should they be aligned?
- Is the existing sales organization structure sufficient to serve the needs of the market?
- What does the buying process look like?
Does your sales organization have the right go-to-market strategy?
The effectiveness of any sales organization depends on its ability to drive company strategy. As organizations grow, however, this ability can become impaired, with many struggling to convert their priorities into effective sales strategies and action plans.
To review the effectiveness of their go-to-market strategy, sales organizations need to take a complete sales management perspective, working closely to ensure the approach is consistent with the business strategy and objectives.
The process typically involves analyzing market opportunity and market segments, as well as the sales organization’s current products and potential future offerings. The results of these analyses can be used to inform sales strategies and channel selection criteria, answering these key questions:
- What are the needs and buying patterns of the customer population?
- Are there any current product gaps or areas where new products should be developed?
- How should customers be segmented and targeted?
- How should products be positioned, priced and promoted for each segment?
- What sales strategies will most effectively serve current and potential customers?
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