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The past few years have seen rapid growth of new job functions like Sales Enablement and Sales Effectiveness. Until 5 years ago, these functions were outsourced to external consultants, but now they are fast becoming an integral part of Sales Operations.

What is Sales Effectiveness?

Sales Effectiveness refers to how well a company’s salesforce performs at each stage of the customer’s buying process to ultimately earns business on the right terms and in the right time frame.

Sales Enablement refers to the process of empowering sales personnel to sell more in an efficient and effective way.

How is Sales Effectiveness measured?

Here are some of the metrics commonly used to determine Sales Effectiveness:

  1. Pipeline Conversion Rate:  Converting Opportunities into Sales is key to any business. Year over year trend for the conversion rate can provide valuable insights into sales effectiveness.
  2. Average Deal Size:  You have a sales effectiveness problem if your average deal size is not growing. An effective sales rep is one who not only sells the core products, but also increases the deal size by up-selling, cross-selling, and/or selling auto-renewals and upgrades to the prospect.  This sort of Attach Rate for ancillary products is a good measurement of sales effectiveness.
  3. Ramp-up period:  The time it takes for a new Sales Rep to reach his/her full productivity levels (ramp up period) is a good measure of Sales Effectiveness programs. If your ramp-up period is longer than industry peers, it may be a Sales Effectiveness problem.
  4. Quota Attainment for New Hires:  During the quota ramp up period, metrics like 30-day, 60-day, 90-day quota attainment are tracked by Sales Effectiveness teams. This can be an indicator for your Sales Effectiveness programs.

Once you have established measurable goals, the next step is to improve the Sales Effectiveness program.

How do you improve Sales Effectiveness?

  1. Goal Setting:  Goals for your sales reps, whether Quota or MBOs, should be SMART – Specific, Measurable, Attainable, Result Oriented and Time bound.
  2. Coaching:  Sales coaching should be an ongoing process. When the product offerings and/or business strategies change, skills and priorities for sales reps should be realigned. There are several learning platforms like Litmos (CallidusCloud), Lynda (LinkedIn) that can facilitate the development and rollout of sales coaching programs.
  3. Visibility into Goal Attainment:  As the saying goes – If it can’t be measured, it can’t be improved. It is very important for sales reps and management to have timely visibility into goal attainment. Sales Performance Measurement tools like Xactly, CallidusCloud, IBM and Anaplan, can provide great visibility into sales activities, as well as analytics for proactive planning.
  4. Learn from Leaders:  Manage a leader board, identify your rock stars, and get them to share their insights with the rest of the salesforce.

Partnership with the Sales Leadership is key to ensuring success of any Sales Effectiveness program. By providing proper training, tools and visibility to the Salesforce, Sales Effectiveness programs can become vital components for long term success.