Driving new sales revenue is a common theme that comes up with the clients I work with. In fact, I can’t think of many companies that have more sales activity than they know what to do with, and most are always looking for ways to build or grow their sales pipeline. One of the first places we start is taking a look at their Sales KPIs to ensure that they are measuring the right metrics to grow their revenue by producing enough qualified leads for their sales managers to distribute to the team.
There a lot of variables that go into building a great sales pipeline, and marketing plays a big part in developing marketing qualified leads (MQLs), but another big variable is measuring the right behavior that drives the right results with a great sales KPI dashboard. To do this, we must put the right leading indicator KPIs in place. It’s one thing to measure results indicators like Revenue booked, but unless the right activities are taking place, you are not going to hit your targets and your stakeholders are going to be disappointed regardless if they are internal or external. You need to develop the right sales leading indicator KPIs for your team to track your customer acquisition.
I often get the question, “What leading indicators should I be measuring?” As a consultant and coach, I give the typical consultant answer, “It depends.” I know what you’re thinking, that’s no answer at all, but it really does depend. There is no cookie-cutter solution that works for every company. It depends on what the steps are in your sales process and sales funnel. First, we need to create a flowchart of every step that takes place from inception to close and dig deep to make sure we don’t miss any important steps. Once we have this, we can determine what metrics we want to measure that drive the right behavior and build the pipeline to drive the results we need.
Example of a Sales Pipeline:
Here are some common leading sales indicators I have personally used and have seen used by successful companies. Your sales leading indicator KPIs may vary depending on what your sales process looks like, but this list should get you thinking about the key performance indicators for your sales and marketing teams..
10 Common Sales Leading Indicator KPIs
- Prospects Identified
- Sales Qualified Leads
- Appointments Set
- Face to Face Meetings
- Proposals Presented
- Proposals Pending
- No’s Received
And here are some bonus sales KPIs that may not necessarily be a direct part of your sales funnel, but are still leading indicators often driven by the marketing team that drives interest from sales prospects you may want to track:
- Networking Events Attended
- Speaking Events
- Blogs Written
- White Papers Written
- Referrals Requested
At the end of the day, as with most other challenges, there is no silver bullet. You have to do the hard work, and driving the right behavior is the most effective thing we can do to get predictable results. My good friend John Moore, of Moore Power Sales Vision, told me years ago, you can’t manage results, only behavior, and I could not agree with him more, no pun intended! One way to ensure that you are driving the right behaviours in your sales reps is to build sales dashboards with the sales metrics that most directly influence your monthly sales. This will allow your sales managers to set up the right sales processes that will help you increase conversion rates and increase your average sale, while making sure you are getting more revenue out of your existing clients.
If your current sales KPIs are not producing results, it is time for a KPI audit. Document your sales process and build a funnel that represents how you develop new sales. Assign KPIs to the key steps in the funnel and begin testing. If they are working for you - great, if not, make adjustments and test again. Remember the old saying: what gets measured gets improved. The time you spend putting the right leading sales indicators in place will pay off with predictable results.
There are a lot of other good leading KPIs you can measure to drive sales. If you have a KPI you use that has been effective, please share it and good luck hitting your numbers this year, Alan
Rhythm Systems KPI Resource Center
Photo Credits: iStock by Getty Images
Photo Credit: iStock by Getty Images