What gets measured gets done. But only if the key performance indicators (KPIs) established for any given role in an organization are reachable and understandable. Too many companies focus on either outdated KPIs or high-level, financially-oriented metrics beyond the control of the typical employee.
Identifying performance metrics that are most relevant to your role in the organization, and ensuring that they reflect your own and your staff’s progress as aligned with your organization’s overall strategy, is a tall order – but essential to staying focused and on the right track.
Below, I’ve outlined some metrics that I think are fundamental to four key roles.
1. Executives: The Conductor Sets the Tone
Like the conductor of an orchestra, it is the senior executive’s job to guide the organization towards success. If you’re in this role, you must be able to see ahead.
It is also the role of a leader to ensure that all managers, teams and salespeople work together towards a common goal: ultimately, the company’s. Cascade objectives across hierarchies in a clear, consistent manner, so that every employee on your staff knows what his or her contribution should be.
Look at metrics that will tell you how the company is doing per se, and within the market context. As an executive, two of your biggest concerns should be your market share and your sales structure’s reach into different territories and business segments.
2. Sales: Everybody, Eyes on the Prize!
The sales function fuels the entirety of the company. But sales departments have become increasingly complex over the years, with channels and roles diversifying.
Each major subdivision has its own priorities:
Sales Managers and Salespeople
As a sales manager, you must have visibility into customer portfolios so that you can monitor the performance of central accounts, products, and territories. The following questions are important to consider when evaluating your own performance against your goals:
- Am I/is my team on target?
- What does my customer portfolio look like?
- How much will I earn if I convert all or part of my pipeline?
- What opportunities/customers/products should I focus on?
As a sales operations leader, it’s essential to provide the sales force with the right infrastructure, processes, and best practices to achieve its potential. Ask yourself:
- Is the compensation plan driving the expected behaviors by metric (achievement vs. target)?
- Is the plan biased to certain metrics or characteristics of a territory, such as size, market share, geography?
- Can you effectively track your reps’ efforts to close a sale and leverage opportunities?
- Is the sales compensation budget in line with the forecasted estimate?
- Are the quotas you set at the start of the year accurate?
3. HR: It’s All about Talent
HR is responsible for the ways in which sales professionals are recruited, incentivized, and trained.
A great HR leader has one overriding goal: to attract and retain talent.
Easier said than done. As an HR manager, here are three questions to consider when measuring sales performance:
- Who are the top performers?
- Who are the bottom performers?
- Are the top performers the same as the top earners?
Compensation is just one of the key drivers for top sales employees. Career opportunities and a great company culture are other important factors that keep your best people motivated and loyal.
4. Finance: It’s All about the Money
Finance people are notoriously preoccupied with the numbers. And money, of course. In addition to generating budgets and macro forecasts, however, they are also tasked with achieving key goals.
If you’re the CFO or a leader in Finance, you‘ll want to closely follow budget realization and check that the accrual process is accurate. You’ll also need to track territory and channel performance. Try to maximize gains from high-performing and high-potential territories while simultaneously raising performance or limiting losses in low-performing ones.
Your Key Metrics Define Your Future Performance
These are just a few KPIs for the key roles in Sales that contribute to the big picture of an organization’s performance. Depending on the industry and market evolutions, but also on the role you have inside the organization, some metrics can become more relevant than others.
Before relying on certain KPIs, always check data availability. Establish a cohesive process to gather data, generate analyses, and continuously reassess conditions. Carefully select the metrics that you’ll follow, and adhere to them closely and constantly, as they will guide performance inside your area of responsibility.
What are the key metrics that get the most attention inside your organization or department? Check out additional research from Optymyze and don’t hesitate to share your thoughts.
Guide to Using Sales Analytics to Improve Sales Performance
Did you know that sales analytics adopters report improved quota attainment, higher customer retention rate, and more deals resulting in revenue? Download this guide and find out how to turn data into results.