Sales productivity in an organization involves devising strategies to maximize sales results while minimizing the resources expended in terms of cost, time and effort. In current corporate selling space, Sales Productivity is the number one challenge for approximately 65% of the companies, according to a report published by The Bridge Group, an inside sales research, and consultation organization. Hence, increasing sales productivity needs to be a crucial aspect for a business to focus on.
Going by the 20/60/20 rule or Pareto Rule, what is worrying here is that 20% of the sales team involves top performers who are able to meet and even exceed quota. According to Harvard Business Report, more and more companies are thriving to narrow the gap between the top 20% and the rest of the sales force. As a result, not only the top performers but even those in lower quartiles have shown drastic improvement in the average sales per representative increasing by as much as 50% in two to three years.
As quoted by CEO of SAP Americas, Bill McDermott,
Overwhelming improvement has been seen in the company where their software license business has more than doubled in three years, increasing its market share by 17 points.
The efficiency, effectiveness, and productivity of a well-managed sales force have a direct and substantial impact on the company’s revenue. According to a recent research, a sales persons actually spend 41% of their time in selling every week. It is important to comprehend where does the rest of the time get consumed?
Let us explore in this section some effective strategies to increase the productivity of sales team in an organization that would have a positive impact on the overall company’s performance.
Investing in Sales Training
It is estimated that 55% of the entire sales force lack adequate skills to be successful and fewer than 45% of the companies have a formal sales training process. Adequate investment in sales training is crucial to increase the productivity of sales team in an organization as there are always new things to unfold and new tools to master. According to a recent research, to fully onboard and train a salesperson, it takes around 7 months and almost $30,000. This comes in light with the fact that almost 87% of the training content gets forgotten within weeks.
Training programs need to be implemented to help your sales team to learn complex products and services efficiently and to utilize the knowledge to make good sales. Using right onboarding tools, ramp-up time in a company can drop down by at least 30-40%. Additionally, around 2/3 of sales representatives who lie below quota can be guided to deliver best performances in a sales driven work environment.
Prioritise Your Leads
According to a research from CSO Insights, 24% of a sales person’s time is spent on generating leads and researching accounts. What remains ignored by most of the sales representatives is that it is better to catch a shark than a bucket full minimal. Going by the Pareto Rule, 20% of the leads contribute to 80% of the total sales and the rest 20% sales are generated by 80% of the sales force. Hence, it is crucial for them to focus on eliminating time wastage by ranking leads on the basis of profitability to help the team focus on those that have higher chances of sales conversion and have bigger revenue.
Generating more leads is not important as that might mean chasing prospects who are not willing to buy your product or services. What is more important is to deliver fewer leads to the sales team but ensuring that those leads are ready for conversion. Sales teams should be encouraged to spare extra minutes to understand the response rate of every lead conversion and then focus on those in the order of their priorities. This will helps saving time and boost productivity in the long run.
Deliver the Right Content at the Right Time
96% of B2B and B2C sales are content driven and yet, nearly 60%-70% of the content never gets used by sales team as they are not able to find relevant content at the right time. At times, information overload becomes a menace as companies have increased the rate of producing content exponentially.
With the acceptance of more and more cloud storage services, file servers and shared drives, sales team needs to be equipped with information on locations to find the most relevant content. Knowledge workers spend searching for documents each week for 5.5 to 8.8 hours per week, and even then one cannot be sure of the data is the most up to date version. Sales team should know how to access collateral, which aspects to be shared and when to use it in the sales cycle.
Alignment of Sales & Marketing Teams
80% of sales occur after 5th call, whereas only 20% of sales personnel make it to a 3rd call. Also, one-third of sales teams reported that marketing team fails to provide collateral to support a sales process while 44% of them are stuck with old and ineffective materials. This individual operation of sales and marketing departments has given an unprecedented dent into companies’ revenue. Forrester research has shown that only 8% of companies have tight sales and marketing alignment.
Feeding sales team with good quality content and leads can easily increase sales team productivity. Aberdeen Group research shows that 74% of Best in class companies have strong alignment between sales and marketing. A culture of shared responsibility is what is needed across the enterprise which can lead to a 25% increase in sales quota achievement and 27% faster three-year profit growth, suggesting the need for a strong collaboration between departments.
Structure Meeting Time Better
It is reported that most sales representatives spend more than 50 full days away from core selling activities each year. Over 19% of the time is spent on meetings or administrative tasks that demand great attention. This includes both 1:1 meetings as well as group ones. Most of the sales meetings are called without an agenda where the prime focus of discussions is an emotional stream of consciousness from their managers.
Ensure to have a specific agenda and keep a track of the time. If an agenda is complete and there is nothing more to discuss, the meeting should be ended. Cover topics that are relevant to most people in the room. Another suggested practice is to stand throughout the meeting to boost mental productivity. Decision making would get faster and their minds would work faster to find solutions to problems and hence increase the productivity of your sales team.
Review Current Pricing Strategies
It is estimated that less than 5% of the Fortune 500 companies have a full-time function dedicated to pricing whereas only 15% of companies do systematic research on the subject. Positioning yourself in the correct pricing bracket drives sales to a large extent. The sales team are detrimental in ensuring that the prevailing pricing strategies are up-to-date. Pricing and sales strike a delicate balance and need daily communication to drive impactful strategies. Small variations in price can raise or lower productivity by as much as 20% or 50%.
Include a quick review of prices within your daily sales checklist to ensure maximum profitability for your company. Work with your pricing team to highlight recent discounts that lead to profitable high-volume orders and those that backfired. Ensure that the pricing team is monetizing value efficiently. Launch better price realization in days, not weeks.
Use of Optimised Tools, Automation and Procedures
Sales force automation is fueling new sales strategies and enabling productivity across organizations. Automation like emailing and call scheduling foster sales team productivity by providing scripts, data, and content just when they need them. Sales stack allows them to call potential leads and inform them about the type of content that needs to be delivered to drive optimum sales. A research carried out by Accenture shows that high performing sales organizations that use a structured sales approach to sales improve sales productivity by up to 30% and give your revenue a 5-10% boost.
Companies like Aggreko North America uses CRM Software with a profitability predictor that helps sales team to tweak an offering in the case of low margins. Feed your sales team with right tools to help them perform efficiently. It is also important for the sales team to be able to embrace technology and include them in their regular workflow. PwC Survey highlights that 68% of the CEOs say data and analytics technologies deliver the greatest return on customer engagement. Technology helps in maintaining a customer-centric work culture.
Motivation & Confidence
Rejections in sales can be quite stressful and disheartening and can worsen if rejections are continuous over a long time span. As mentioned by Lokesh Tanwar CEO of Business Alligators, sales representatives who belong to the lower 20% of the quota are the ones who are least convinced with products or services of the company and due to which they are least motivated and confident. And thus adversely affect the sales team productivity.
Conviction in the product is 1000 times more important than Product Quality.
– Lokesh Tanwar
According to Hay Group report, 50% of motivated employees outperform the expectations and they cost you 54% less. Also, motivated people are more engaged at the workplace and workplaces with engaged sales persons are 43% more productive. It is crucial to equip sales team with the right dose of confidence and motivation because people find confident people more trustworthy and hence directly affect their sales productivity. After all, it is not what you say, it’s how you say it.