5 Ways to Measure if Your Sales Process is Working

April 15, 2013 at 7:00 AM

You’ve invested in the technology.  You’ve trained the entire sales organization.  The sales process is finally out in the field.  Will your efforts get the best possible return?

Rolling out a new sales process is tough work.  For Sales Operations, it’s one of the most important projects you’re responsible for.  The risk is high because the money and time invested is significant.  You want to measure if it's firing on all cylinders.

Download the Sales Process Evaluation Guide here.

First, let’s get one key distinction on the table:

A sales process is not a sales methodology.  “Spin Selling” and “Solution Selling” are methodologies.  A sales process is a set of well-defined stages that can be tracked.  Sales professionals can apply a sales methodology to a process.  A factory has measurable output in units produced.  A sales process has measureable outputs as well - a pipeline and a forecast.  A methodology does not.

For more on the distinction between process and methodology, read John Kenney’s post

Why Take the Risk?

Because of all of your investment, implementing a sales process carries risk.  Your objective is to reduce the risk while improving the reward.  The facts are there.  Our work across sales organizations proves the benefits.  Well implemented sales processes deliver the following results:

  • Reduce sales cycle length by 20%.  A cycle of three months would be reduced by 18 days.
  • Improve win rate by 24%.  A win rate of 25% would improve to 31%.
  • Increase average sale price (ASP) by 15%.  An ASP of $250k increases to $287k.

These all have a compounding effect.  More closes at a larger ASP delivered faster.  There are other significant rewards as well.  Better forecasting, more new logo wins and reduced attrition to name a few. 

Now, you may be saying to yourself: “I took the risk because I already know the benefits.”  Your next question may be “How do I reduce the risk of implementing a Sales Process?”  Many posts have been written on sales process implementations.  A great process that doesn’t get strong adoption is a waste.  Check this post for best-in-class guidance:

Further, successful sales process implementations have to be based on buyer behavior.  Conducting great research into how and why your buyer’s purchase is essential.  A process aligned with the buyer will greatly reduce your risk.

The Signs of Success Are There – Measure Them

Here's a summary of the key measures to use to gauge success:   

  • Process Utilization:  Are 90+% of your reps using the process?  If so, this shows the process is delivering value for the sales team.  The tools are useful and are helping them sell.
  • Deal Size:  Are average sales prices increasing?  This is a strong indication that your process is helping customers recognize needs.  The process is enabling you to sell on value, not price.
  • Forecast Accuracy:  Is your pipeline-based forecast within 10% of reality?  This is a great indicator that you are in step with the buyer.  In addition, solid forecasting is a sign of consistent use of the process.
  • Win Rates: Like deal size, win rates should improve in a measurable way.  Your process is helping you beat the competition.  Even if the competition is the status quo where the buyer takes no action.
  • Sales Cycle Length:  A good process will drive opportunities through the pipeline faster.  It illustrates you haven’t introduced friction and extra cycles into the process.

What if you measure these items and find that progress is not being made?  There are a few possibilities that you need to explore. 

A strong reinforcement plan is required.  Much of that plan rests with your front-line managers and sales leadership.  Celebrate success.  Hold management accountable for process utilization metrics.  Conduct pipeline reviews.  Observe the sales team in action.  Watch them using your CRM.  Gather their feedback on how the process can be improved.

I’ve already mentioned that the process needs to align to the buyer.  But here’s one more thing to consider.  Buyers are not static and your sales process can’t be either.  Your process needs to change with them.  Just a couple of years will make a big difference.  Update your buyer research. 

Check to see if your sales process is firing on all cylinders.  Download the Sales Process Evaluation Guide.

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Topics: Sales Process, Sales Operations Strategy, Forecasting, Buyer Process Map, sales operations, Sales Force Effectiveness, Buyer

Posted by Patrick Seidell

Patrick Seidell
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