To become a top notch business professional, you need to brush up on all the skills relevant to your field. Like everyone else, sales managers have to stay sharp and focused.
Of course, there is a massive people component to being a great sales leader, but ultimately the success and reputation of any sales manager boils down to the math. With sales being primarily a numbers game, your ability to generate the right metrics is the ultimate justification for your role as a sales leader.
Given the wide range of data points that can be measured, which key performance indicators (KPIs) really help you become a better sales manager? Which sales KPIs should always appear in your dashboard?
Sales KPIs make it easier not only to have a panoramic view of your sales operations but also a detailed look at how the different elements in your sales strategy actually plays out in the real world.
Here are some reasons why tracking the right KPIs will make you a better sales manager:
- Allow for a data-driven sales management approach.
- Add visibility, predictability and control to revenue generation.
- Gauge whether your salespeople operate at peak efficiency.
- Identify whether there are gaps in the sales process that need bridging.
- Adopt the right workflows, shared resources, and staff training/coaching.
- Help you increase overall productivity.
- Enable your team to set clear targets, expectations, and assessments.
- Help you make smarter strategic decisions.
How to Determine Which Sales KPIs to Track
There are many possible KPIs in sales, with Vantage Point identifying more than 300 metrics that track or influence your sales performance. Certainly, not every one of these metrics can be considered a KPI for your business. That means you only need to focus on the ones that are vital to your specific sales operation. Otherwise, you’ll be swamped in a sea of cluttered and unnecessary data, a situation that exemplifies the corporate equivalent of analysis paralysis.
Here’s how to determine and establish the right KPIs for your team:
- Identify KPIs that directly relate to your team’s organizational structure.
- Adopt only KPIs that conform to your sales process/funnel.
- Consider industry best practices.
- Note which KPIs are used by your competitors.
- Get feedback from your team on which KPIs need to be monitored.
- Test efficiency of KPIs sets, adopt most effective sets, and iterate.
Sales Hacker CEO Max Altschuler: Top 12 Sales KPIs
You may opt for a comprehensive set of KPIs but it is important to focus on the core KPIs that grant you more power in influencing team performance and outcomes. In sales, the most important KPIs are those that track:
- The team’s cost efficiency
- Key sales activities
- Sales pipeline flow
- Achieved outcomes
- Overall team satisfaction and motivation levels
Here are 12 common metrics that should always appear in a sales manager’s KPI list:
Sales KPI Set #1. Activity Metrics
1. Level of prospecting activity - This is a set of numbers showing how many calls, demos, emails, meetings, and other prospecting activities were made by each salesperson in a given period.
2. Level of prospecting activity vs. target - This is a metric showing whether targeted activity levels have been reached.
Sales KPI Set #2. Pipeline Flow
3. Lead flow - This refers to the number of new leads introduced into your sales pipeline within a given period.
4. Lead response time - This measures how prompt and fast a salesperson responds to a prospect’s concerns. Pro Tip: Use a business phone system like Nextiva to increase the speed of response.
5. Usage rate of customer resources/marketing content - This shows how much your sales staff are leveraging existing resources to make prospects more likely to convert.
6. Number of qualified leads generated - This refers to the number of leads transitioning into key prospects who are more likely to convert.
7. Customer retention - This encapsulates repeat business and customer attrition rates.
Sales KPI Set #3. Achieved Outcomes
8. Booked revenue - This refers to actual money being reeled in through new subscriptions or purchases, additional business generated from existing customers, and service renewals.
9. Win rate/closing ratio - Also called conversion rate, this refers to the ratio of new customers as a fraction of the total number of qualified leads.
10. Quota fulfilment - This shows whether your team and its individual members have achieved either the targeted conversion rate or the revenue goals.
Sales KPI Set #4. Team Cost Efficiency
11. Revenue per sales rep - This shows your company’s return on investment per sales hire.
Sales KPI Set #5. Team Satisfaction and Morale
12. Employee satisfaction - This indicates a number of things including your staff’s motivation level and likelihood of leaving the organization for another employer.
Sales KPIs: Drive Success by Doing the Math
Sales KPIs help you evaluate where your team stands on core metrics and how individual members can improve their game. For managers, KPIs provide the required data in making the right tactical and strategic decisions.
Once you have determined the best KPIs for your sales organization, you’re all set to perform the following:
- Keep track of your sales KPIs.
- Establish accountabilities for specific KPIs.
- Analyze how your KPIs behaved during a specific period.
- Identify the factors that influenced their behavior.
- Determine how you can improve the numbers.
End result: A target-driven sales environment that will create lasting success for your organization.
Ambition: Create Your Target Driven Sales Environment
Ambition is a sales management platform that syncs every sales organization department, data source, and performance metric on one easy system.
Ambition clarifies and publicizes real-time performance analytics for your entire sales organization. Using a drag-and-drop interface, non-technical sales leaders can build custom scorecards, contests, reports, and TVs.
Ambition is endorsed by Harvard Business Review, AA-ISP (the Global Inside Sales Organization), and USA Today as a proven solution for creating target driven sales environments. Hear from our customers below.
- FiveStars: Adam Wall. Sr. Manager of Sales Operations .
- Filemaker: Brad Freitag. Vice-President of Worldwide Sales.
- Outreach: Mark Kosoglow. Vice-President of Sales.
- Cell Marque: Lauren Hopson. Director of Sales & Marketing.
- Access America Transport: Ted Alling. Chief Executive Officer.
Watch Product Walkthroughs:
- ChowNow. Led by Vice-President of Sales, Drew Woodcock.
- Outreach. Led by Sales Development Manager, Alex Lynn.
Read Case Studies:
- Wayfair: Daily outbound calls increased by 100%.
- Peek: Monthly sales activity volume grew 142% in 6 months.
- Vorsight: Monthly sales conversations grew 300% in 6 months.
Contact us to learn how Ambition can impact your sales organization today.