Seven Signs That Prove Your Sales Process is Working
Rolling out a new sales process is not easy. It takes a lot of planning, research, communication and flat out hard work. But it is a really important task because the payoff-when done properly-is significant. A study conducted by CSO Insights showed that companies with a dynamic sales process won 53% of their forecasted deals compared to 43% who do things “ad hoc.” All other things being equal, rigorous sales process management yields 10% more output from a sales force. No too shabby!
If you’re wondering if and how a sales process could impact sales results within your IT staffing organization just take a look at some of the results our customers have experienced from implementing a sales process:
- 150% increase in opening new accounts (over prior QTR)
- Increase sales win rates by 12%
- Increase average sales price (hourly bill rate) by 11%
- Ability to accurately and confidently forecast revenue
- Increased sales win rates by 9%
The key to improving sales performance and ultimately scaling your business model is to invest in increasing the overall effectiveness or your sales organization. As the CSO study proves, sales reps who sell in the same consistent manner are far more likely to consistently hit their quota. When reps sell consistently, predicting sales performance and forecasting revenue becomes much easier. In fact, it becomes predictable. But how do you know if your sales process is actually working and making an impact?
Seven Signs That Prove Your Sales Process is Working
Sales Process Adoption & Utilization
Are you sales reps following and using your sales process? If your sales reps are not following your sales process then you may have management problem. On the other hand your sales reps might not be following your sales process because they simply don’t believe in your sales process. Sales people and especially top performers will not follow a process simply to "check the box." Your process needs to account for the realities of current market conditions and help sales reps hit their quota quicker and with less effort. Your goal should be to have 90% of your salesforce following your sales process. Questions to ask include:
- Are (90% or more) my sales reps documenting their opportunities consistently?
- Are deals being managed and updated in a timely fashion?
- Are my reps opportunities (job orders) in the correct stage of the sales cycle and are they being updated accordingly?
- Can my reps forecast their deals by using objective, verifiable data where they have eliminated “gut feel” for their means for sales forecasting?
If you have a low sales process adoption rate than you need to talk to your sales team and find out why and iterate accordingly.
By measuring the number of opportunities (job orders) in each stage of your sales pipeline and what percentage in each stage convert “down the funnel” you get a clear sense of how effectively your reps are qualifying deals and compelling the buyer to take the next step in their purchasing process. If 90% of your salesforce is converting 40% or more their deals from the current stage to the next stage in your sales funnel then your sales process is working mighty fine for you.
Sales Win Rate
Are your reps improving their sales win rates? A well designed,buyer-aligned sales process will improve sales win rates. You will want to look at each of your sales rep’s sales win rate percentage. Look at their win rate pre-sales process rollout and post-sales process roll out. If their sales win rates are going up that is a strong sign your sales process is working for you.
Sales Pipeline and Forecast Accuracy
Is your pipeline-based sales forecast within 10% of reality? If so, that is a great sign that your sales reps and your sales process is aligned and in sync with your buyers. Accurate forecasting is also an indicator that your sales reps are following (adopting) the sales process.
Length of Sales Cycle
A well designed sales process that is aligned with how your buyers buy will accelerate your sales cycle. A sales cycle that gets shorter in duration also proves that your sales reps are providing the right information and sending the right message to the buyer for each stage of the sales process. In essence you’re removing friction and eliminating wasted sales cycles.
Increase in Deal Size
Has your average deal size increased? If so, this is a strong indication that your process and your sales reps are helping customers recognize needs. The process (and your sales methodology) is supporting your sales reps to sell on value, not on price.
Increase in overall quota attainment
Are you seeing an increase in overall quota attainment? As noted in the CSO Insights study, a well- designed sales process that is actively managed and monitored will increase overall quota attainment. If more of your reps are meeting and exceeding quota than you know your sales process is making an impact.
Final Word of Caution-You Must Actively Monitor, Measure and Update Your Sales Process
Keep in mind that simply configuring your CRM/ATS tool to reflect the stages of your sales process and your buyer’s journey is NOT going to deliver your desired results. Sales leaders must actively monitor and measure the effectiveness of their sales process by maintaining a continuous feedback loop with their sales reps and customers. Your sales process is a living, breathing entity and it will continue to evolve over time. Don’t fall into the trap of thinking that creating a sales process is a “one time event.” Sales leaders will also need to monitor buyer action. In short, the only way that you know that you have successfully completed a stage in your sales process and that your sales rep and customer are now ready to move to the next stage is by evaluating buyer action. You need to track and measure to what degree your buyers are committed to taking action.
How confident are you in your sales process? What key performance indicators are you tracking to measure the effectiveness of your sales process?
About Dan Fisher
Dan Fisher is founder and owner of Menemsha Group, a provider of sales enablement solutions dedicated to helping IT staffing firms improve win rates, shorten their sales cycle, and increase revenue per sales rep. Since launching Menemsha Group in 2008, Dan has consulted with over 200 IT staffing firms and has invested over 5000 hours coaching IT staffing sales reps. He’s authored is his own proprietary sales methodology and has previously spoken at Staffing World, TechServe Alliance and Bullhorn Live 2012. Prior to launching Menemsha Group, Dan spent 16 years in the IT industry running local, regional and national sales teams. Dan worked for Kelly Services, Oracle Corporation and Alliance Consulting. Dan currently resides in Boston, Ma.