6 KPI Performance Metrics to Help Manage Your Inside Sales Team
Are you managing an inside sales team? Are they failing to jump on the phone and make the calls? If yes, what does the phone mean to them?
There is no secret that a debate exists among many sales managers on how to track the performance of a sales team; and this is particularly true when it comes to the discussion around inside sales. What’s more important: the number of calls a sales rep makes, or the quality of the call? Let’s face it, if you’re not making calls, you can’t measure the quality. We recommend you need to monitor & set KPIs for both.
Maybe a bigger question, does your sales team have enough revenue opportunity to hit their sales target? Maybe they don’t have enough leads to make the calls?
What is Your Revenue Opportunity?
In order for a sales team to succeed, the Sales manager or Sales director needs to measure the revenue opportunity using 3 key factors:
- Are you behind on hiring your sales team?
- Do you have a high level of absenteeism?
- Does the sales team have enough leads in their pipeline?
- Are the pipelines full of low value leads?
If you find yourself nodding in response to any of these questions, Heuston we have a problem. In most companies these factors are brought back in line by the management team.
So How Effective is Your Sales Team?
Assuming that your revenue opportunity is in place, to increase productivity of your sales team, you need to drill down and understand the performance levels of each person. Here's our 6 suggested KPIs:
1. Number of Calls Per Day vs Talk Time
- The number of outbound sales calls will differ greatly from one industry to another. In the payment industry for example, the sales rep has a lot of pre and post-sale work to do. Very often they need to assist the merchant with underwriting, pricing, contracts etc.
- The range of outbound calls will typically be from about 40 calls to over 80+ a day. I normally aim for between 50-70
- If you have an outbound dialer, salespeople can potentially generate 100+ calls a day
- We recommend sales reps having a talk time target so they aren't just picking up the phone and dialing reception instead of talking to decision makers. Consider a talk time target of 2-3 hours
2. Percentage of Calls at Each Sales Cycle
It’s important to know how each salesperson is progressing along their sales cycle. If you’re not having much success on your first call attempt, chances are you'll probably have a low conversion rate by the time you get to close a sale.Here’s an example of a good sales pipeline progression:
The second example highlights that the sales rep is failing to get past the gate keeper, and is struggling to schedule time with the decision maker. Monitoring the sales cycle progression will help you identify coaching and training opportunities for the salesperson to help improve efficiency of their outbound calls. For more information on qualifying sales leads and differentiating between cold and warm leads, check out our in-depth lead generation guide.
3. Conversion Rate
I’ve often heard people say that a 10% conversion rate for an inside sales team is quite good. Again, this can vary from company to company. If your company is well known and with a strong market position, your salesperson could generate in excess of a 30% conversion rate, vs a startup which could be generating only a 5-10% conversion rate.
4. Close Lost Rate
Although a sales rep may have a high conversion rate, make sure to monitor their close lost rate too, as that could also be very high. If it is, it could be that they are burning leads, in which case you need to put out the fire!
5. Average Value of Merchant Won
When setting a sales target, you must consider the average value of a merchant to be won. I’ve worked with sales teams where they’re winning 1,000s of merchants, which was great, but the average win was so low that they were missing their sales targets by miles. Not so great.
6. Performance Against Target
Sales targets are normally set at : country, team, and sales rep level, I recommend you also include targets for:
- Average merchant size
- Close won rate
- Close lost rate
- Number of calls to be made each day, week, month
- Commission target
- There are many more you might like to add in
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