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. About The Sales Management Association A global, cross-industry professional association for sales operations and sales management. Focused in providing research, case studies, training, peer networking, and professional development to our membership. Fostering a community of thought-leaders, service providers, academics, and practitioners. Learn More: www.salesmanagement.org © 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
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