Seeing that measured difference can provide guidance on how to improve the organization.  However, once the targeted metric has been improved, it may result in a hollow victory: a win on the report that didn’t yield results on the bottom line.  Scenarios such as these can arise by not linking the potential improvement to what really matters, which is the end result.

 

Sales Performance Management Scenario

 

Just because a metric is below the benchmark does not mean that it is worth launching a significant attempt to improve it.  What will the impact of the change be on the bottom line?  Given the limits on your time and the time of everyone in your organization, priorities need to be set, and to focus on hitting a benchmark for its own sake isn’t going to produce results.

 

In order to evaluate the actual usefulness of an improvement, first consider the effects that it will have on the organization:

 

  • Estimate the improvement in the KPI that you deem achievable (consider multiple scenarios).
  • Apply the change to your current results, allowing the results to flow through to each area it affects, and ultimately to revenue and cost.
  • Evaluate any potential costs and compare against the estimated gains.
  • Consider what the other options are.

 

The last step is one that should be emphasized.  If you run a scenario and find that it produces a small improvement in performance, this improvement may still not be worth chasing down at this time based on the opportunity cost.  Is there some other use of your time that could yield greater changes?  Alternatives are always worth considering in an environment where time is becoming more and more precious.

 

Every sales organization has room for improvement, and it is management’s first task to figure out what that improvement should be.  Make sure that when that decision is made you are not chasing a whim or a marker that doesn’t mean anything to your organization, but instead dedicate your organization’s resources to chasing results.  Properly use of a Sales Performance Management framework with benchmarking can send you off in the right direction.

 

Have you had previous strategy initiatives that left you with subpar results?  Find out how SBI can help you design a sales strategy that will produce for your organization.

 

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