Sales Management Association Webcast
Beyond the Commission: Staying Ahead of the
Sales Performance Management Maturity Curve
15 April 2015
Presented by
© Copyright 2015 The Sales Management Association.
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© 2015 The Sales Management Association. All rights reserved.
Slide 2
Today’s Panelists
#SalesPerformance
© 2015 The Sales Management Association. All rights reserved.
Slide 3
Sales Management Association Webcast
Beyond the Commission: Staying Ahead of the
Sales Performance Management Maturity Curve
15 April 2015
Presented by
© Copyright 2015 The Sales Management Association.
IBM Point of View on Maturity
SPM Competency and Value
IBM Point of View on MAturity
Scaling a Market
OPTIMIZE
decisions & processes
STABILIZE
the operation
CHAOS pre-ICM
Time
“Typically, organizations begin with efficiency goals, then address
growth objectives, and lastly, design finely-tuned approaches to the
most complex business challenges.”
— IBM Institute for Business Value in
collaboration with MIT Sloan Management Review
Sales Performance Management
Sales
software is part of the answer
Performance Management
Consider approaching it from
& A perspective
aQ“lifecycle”
Lifestyle perspective
Learn to be a
better seller
Visibility for
alignment
& coaching
Process
incentives
Profile your
“A” players
Model & deploy
changes
Incent desired
behavior
Hire the
best sellers
Use analytics to
close more sales
Assign quota
& territory
Onboard for
a quick ramp
BEYOND THE
COMMISSION:
STAYING AHEAD OF THE SPM
MATURITY CURVE
April 15, 2015
Peter Ostrow, VP and Research Group
Director
Sales Effectiveness, Customer Management
@peterostrow
Our first peak at the Best-in-Class:
Validating the SPM space
Percent of respondents
80%
Best-in-Class
78%
Industry Average
Laggard
75%
71%
70%
65%
60%
57%
55%
180
50%
Does your organization have a process to
appraise, evaluate, and / or manage the
performance of your sales employees?
n = 245
Source: Aberdeen Group, March 2015
9
SPM best practices:
Are you behind the curve?
Percent indicating 4/5
on 1-5 scale
100%
85%
100%
83%81%
Best-in-Class
Industry Average
Laggard
87%
80%
75%
70%
70%
58% 57%
55%
67%
63%
53%
54%
46%
45%
40%
Continuously
improve quality,
consistency of
sales talent
Make sales
territories as
equitable
as possible
180
10
Compensate sellers Entire account team Non-cash incentives /
for both individual rewarded, recognized rewards are a vital
and team / group
for sales, sales
component of SPM
accomplishments
growth,
customer service
n = 245
Source: Aberdeen Group, March 2015
Percentage of Respondents
Strategic actions: in sales, you don't
have many second HR chances
50%
All companies
44%
39%
40%
37%
28%
30%
28%
20%
10%
0%
Adopt programs to
Understand,
improve
replicate
management’s
characteristics of
ability to build and
topdevelop sales teams
performing
salespeople
180
Image credit:http://media.sdreader.com/img/photos/2014/01/16/robert-downey-jr-photo-1024x768.jpg
11
Focus on getting
new sales reps
productive
more quickly
Assess rep /
Drive sales
manager
performance,
adoption of specific competencies to
ensure
behaviors / training
alignment with job
via contests,
roles
gamification
n = 245
Source: Aberdeen Group, March 2015
Percentage of Respondents
Top motivators of sales excellence:
Show me the money. And…
100%
76%
2012: 98%
Best-in-Class
75%
50%
41%
37%
26%
25%
24%
0%
Individual
financial
compensation
Internal
recognition
for positive
performance
180
Team-based
financial
compensation
Employee
Competition
engagement
with other
program
team members
aligned to
company values
n = 245
Source: Aberdeen Group, March 2015
12
Best-in-Class: Where do you fit?
Definition of
Maturity Class
Best-in-Class:
Top 20%
of aggregate
performance scorers
Industry Average:
Middle 50%
of aggregate
performance scorers
Laggard:
Bottom 30%
of aggregate
performance scorers
Mean Class
Performance
 99% total company team attainment of sales quota
 75% of sales reps achieving individual quota
 13.1% year-over-year growth in total company revenue; 92% showed
improvement
 3.3% year-over-year improvement in (reduction of) average sales cycle;
39% showed improvement
 61% total company team attainment of sales quota
 50% of sales reps achieving individual quota
 4.3% year-over-year growth in total company revenue; 55% showed
improvement
 0.4% year-over-year improvement in (reduction of) average sales cycle;
14% showed improvement
 46% total company team attainment of sales quota
 27% of sales reps achieving individual quota
 0.5% year-over-year decline in total company revenue; 36% showed
improvement
 3.8% year-over-year decline in (lengthening of) average sales cycle;
19% showed improvement
Source: Aberdeen Group, March 2015
13
Process capabilities:
holistic, team-based SPM
Best-in-Class
Percent of respondents
60%
Industry Average
Laggard
57%
53%
50%
40%
48%
45%
43%
38%
33%
35%
30%
18%
20%
10%
Sales reps’ comp
includes both
individual and team
performance
against goals
Reps use automated
solutions to forecast
performance against
goal and / or likely
compensation
Process to increase
rep engagement with team
performance,
company-wide goals
n = 245
Source: Aberdeen Group, March 2015
14
Percent of respondents
Organizational capabilities:
Are you keeping up with the Best-in-Class?
80%
70%
60%
Best-in-Class
76%
Industry Average
Laggard
67%
62%
56%
55%
48%
50%
51%
41%
40%
35%
30%
Use of public
recognition to
motivate
performance
180
Dedicated resource
to manage sales
comp, incentives
Image credit: http://www.justribbons.com.au/wp-content/gallery/school-general-award-ribbons/participartion_ribbons.jpg
15
Sales leaders collaborate
with HR re: best practices:
hiring, onboarding,
succession planning, L&D
n = 245
Source: Aberdeen Group, March 2015
Percent of respondents
Performance management capabilities:
Where’s the ROI?
70%
60%
Best-in-Class
Industry Average
Laggard
63%
63%
56%
50%
47%
50%
42%
40%
35%
36%
30%
25%
20%
Defined metrics to
analyze impact of
sales performance
on company’s
overall health
180
Image credit: http://archive.news10.net/images/640/360/2/assetpool/photogallery/240633/leaderboard.jpg
16
Sales reps measured
on both quantitative
and qualitative goals
Frequent automated updates
on individual and team
performance rankings,
progress toward goals
n = 245
Source: Aberdeen Group, March 2015
Is there measurable value in
non-cash incentives?
Percentage of Attainment
Sales comp includes non-financial incentives
75%
65%
All others
74%
60%
55%
56%
56%
51%
42%
45%
41%
31%
35%
25%
Team
attainment
of quota
Customer
retention
rate
Reps
achieving
quota
First-year
reps achieving
quota
n = 245
Source: Aberdeen Group, March 2015
17
Percentage of Attainment
Do I need to extend all of this
to my channel sellers?
75%
65%
Comp system includes channel partners
73%
Non-users
63%
54%
55%
44%
45%
35%
42%
32%
25%
Team
attainment
of quota
Reps
achieving
quota
First-year
reps achieving
quota
n = 245
Source: Aberdeen Group, March 2015
18
Percentage of Attainment
Is there data to showcase why
this is so important?
75%
65%
Behavioral analysis assessment users
73%
All Others
59%
53%
55%
48%
45%
47%
39%
35%
25%
Total team
attainment of
annual quota
Customer
renewal
rate
Sales reps
achieving
annual quota
n = 310
Source: Aberdeen Group, March 2015
19
Empowering your front line:
anywhere, anytime, any device
9.0%
Year-over-year change
7.5%
Mobile access to sales content
6.1%
6.0%
All others
5.42%
3.6%
3.0%
2.4%
1.6%
1.5%
0.0%
-0.11%
-2.8%
-3.0%
180
Sales
acceptance
of marketinggenerated leads
Image credit: http://jydesign.com/wp-content/uploads/2012/07/consume-create.png
20
1.6%
% of salesforecasted
pipeline
generated
by Marketing
Cost per
marketinggenerated
lead
Reps
achieving
sales quota
Reduction
in sales
cycle
n = 261
Source: Aberdeen Group, March 2015
Questions and Discussion
#SalesPerformance
Enter
your
Did we run out of time
before
we questions
got to your in the
“Questions”
question? Presenters
can follow-upbox
withon
youthe
via right
email. Feel free tohand
submit side
more questions
if
of the webinar
you’d like an offline response.
application window.
© 2015 The Sales Management Association. All rights reserved.
Slide 21
Questions and Discussion
#SalesPerformance
How do you define a best in
class company?
© 2015 The Sales Management Association. All rights reserved.
Slide 22
Questions and Discussion
#SalesPerformance
It’s gratifying to see more of a modern HR mindset
applied to salespeople – they’re PEOPLE, after all!
With the high cost of sales turnover that you
discussed, I’m convinced my company needs to
take action to reduce it. What would you
recommend as first steps?
© 2015 The Sales Management Association. All rights reserved.
Slide 23
Questions and Discussion
#SalesPerformance
So many technologies were discussed
here, my head is spinning, but I know
they’re valuable. How should I select the
most promising one or two of them to
take baby steps in my organization?
© 2015 The Sales Management Association. All rights reserved.
Slide 24
Questions and Discussion
#SalesPerformance
It sounds like companies should look for
a Lead to Money suite of tools from a
single vendor rather than single silo'ed
solutions from multiple vendors?
© 2015 The Sales Management Association. All rights reserved.
Slide 25
Questions and Discussion
#SalesPerformance
Our leadership struggles with territory
management, and it’s hard to find many reps
who are legitimately happy with theirs. A lot of
days it’s like the Three Bears: some are too big,
some too small. Suggestions?
© 2015 The Sales Management Association. All rights reserved.
Slide 26
Questions and Discussion
#SalesPerformance
Does IBM offer the incentive
compensation software as onpremise, or can I get it as SaaS if
I wanted?
© 2015 The Sales Management Association. All rights reserved.
Slide 27
Questions and Discussion
#SalesPerformance
Do you have clients utilizing all
the solutions you showed on the
colorful S-shaped diagram?
© 2015 The Sales Management Association. All rights reserved.
Slide 28
Thank You.
© Copyright 2015 The Sales Management Association