Leading sales metrics are crucial for gauging performance and consistent forecasting across your sales organization. It can tell you where efficiencies and successes are occurring or are lacking. But it’s important to focus on the right sales metrics and everyone needs to know them. Some only focus on lagging activities from the seller’s perspective such as revenue or number of calls. But metrics that are derived from the buyer’s perspective indicate whether or not everyone is heading in the right direction.
Leading sales metrics include buyer-focused activities. Examples include:
- Prior to a RFP or presentation, you have access to key stakeholders and are allowed time for discovery to understand the executive’s strategies, objectives and initiatives.
- A key stakeholder takes the time to preview your proposal or presentation.
- You are shortlisted or have been given verbal acceptance, and the customer actively participates in regular discussions on getting the solution implemented including approval processes, legal processes, assignment of resources, etc.
These activities translate into valuable sales metrics because they provide insight into where the buyer is in the process by showing the engagement of the buyer.
Sales metrics that focus on things like the number of meetings with the client, number of calls the rep placed, call-to-meeting ratios, and how many RFPs went out to prospects are not useful at all since they are lagging indicators. A salesperson being measured this way is more likely to meet with a client without having performed discovery beforehand or send a proposal because the prospect asked for it way too early in the process and without truly understanding the buyer’s needs. Why? Because he’s being measured by lagging activities from the seller’s point of view rather than by those related to the buyer’s point of view.
Each company will need to determine which metrics are crucial to their sales organization. Companies that employ sales metrics focused on the buyer’s level of engagement will tell you that their forecasting is more consistent and accurate and will have clear indications on how each sales rep is performing, and what skills are required to improve efficiency in the sales cycle at every stage.
We encourage you to take a look at your sales process and determine if you have leading sales metrics clearly identified at each stage in your sales process, and if your sales team knows what they are.
Janice Mars, principal and founder of SalesLatitude, is a senior business and sales executive with more than 30 years of experience helping companies build successful sales teams. She has parlayed that experience to help her clients to improve their sales processes, accurately forecast revenues, ensure focus on winnable opportunities, and attain consistent results. View my LinkedIn profile | Twitter