Measurements / Metrics

Measurements / Metrics

When managing an Inside Sales team or a Sales Development team , there are 2 main methods of measuring their performance: (1) Key (hard facts) Metrics; (2) Soft Skill Measurements.

This Chapter will discuss the first method.

(1)Key (hard facts) Metrics.

·        Response Speed: This is specifically true specifically for inbound leads to measure how long it took the lead qualification team to initially attempt to reach out to the lead. InsideSales.com last year published an article explaining that for specific high level inbound leads the industry best practice is to attempt them within the first 5 minutes. (Note: This is not necessarily true for all inbound leads such as free trial requests).

·         Number of attempts per lead: Not all leads should be attempted the same number of times. For example a lead that directly requested to be contacted should be attempted many times, possibly even 6 or more times. However on the flip side, a lead that attended an educational Webinar run by a technology or strategic partner but did not express direct interest may only require 2 or 3 attempts before determining it is time to move on. I have advised many vendors, to work out exactly what the correct number of attempts should be for all their different leads depending on lead source, profile and behavior.

Then it is important to make sure that the Sales Development team are abiding by these rules and attempting to reach all the leads the correct number of times.

·         Number of Dials: – There are many technologies available in today’s market to assist the management team in monitoring the dial count. The simple fact is that it is a numbers game. The more you dial, the greater the chance you have of finding your next customer. Many managers also measure how many corresponding emails & voice mails were sent along with these dials. This can all be measured daily, weekly or monthly – whatever is preferred by the individual manager.

·         Who is Dialed: If you have a system that scores your leads (for example based on their profile &behavior) then it is easy to measure if they are calling the correct leads. i.e. those with a high score and prioritizing their work load accordingly.

·         Number of Connects – It is important to measure how many dials it takes until the sales rep connects directly with the correct person. This can help you find out the quality of your database contact detail information. It can also give you an indication if the rep is calling at the right or wrong times, especially when working across multiple time zones and countries. This can be measured daily, weekly or monthly – according to your personal preference.

·         Length of Conversations: One method of measuring that the calls made are of good quality is to measure the average length of conversations. This will help you find out of the rep is simply dialing and hanging up (worst case scenario) or if the rep is struggling to get past gatekeepers or the initial introduction is not compelling enough. On the other hand if the call length is too long, especially on initial introductory calls, then maybe the rep is not qualifying enough and is just diving directly into his long sales pitch.

·         Number of Qualified Leads – This is the beginning of the ‘results’ section. It is important to measure how many qualified leads were discovered from all the dialing made. This will give an indication on the database list quality, conversation quality and generally whether or not the inside sales rep has a chance to start building a sales pipeline. This is usually measured monthly and quarterly but needs to be monitored on a regular basis throughout the month to keep the rep on track to reach targets.

·         Number of Qualified Leads accepted by Sales – This metric will show the quality of the qualified leads submitted. The expectation here should be very high and is a key metric in knowing of the rep understands exactly what type of lead is typically a good prospect for the vendor. Even if the closing is performed by the same rep who did the initial qualification this should be measured. This can be done by creating another milestone such as the number of demos given to already qualified leads. It is just as important to analyze the non accepted leads to learn what can be done to improve the qualification process and criteria, thus always making sure the qualification criteria matches the sales teams ‘accepted’ criteria.

·         Number of Sales Accepted Leads entered into Pipeline: – Not all qualified leads will enter into the official pipeline. Some may be a good, qualified leads but not yet ready to enter into the pipeline for various reasons. This should be at a minimum and therefore monitored closely.

·         Pipeline Velocity: – Sales managers must keep a close eye on this section to make sure that opportunities progress through the pipeline towards the higher % chances of closing. Managers should also look for trends. For example if a trend is spotted that shows a high number of leads reach a 40% chance of closing but then constantly get stuck, then maybe that sales rep needs assistance handling certain objections. A healthy pipeline should be spread out allowing the sales rep to have opportunities that can close in the short, mid and long term. It is also important not to have too few opportunities in the pipeline, even if they are large deals.

·         Closed Deals: – The bottom line is important for obvious reasons. We are in a results oriented business and $$$ talk. However I usually split this into 2 categories:

·         Number of Closed Deals: – The preference should always be for a sales rep to be closing a healthy number of deals. This makes sure that they do not put all their eggs in one basket, hoping for the one large value deal.

·         Average Value of Closed Deals: – This is measured to make sure the closed deals are not too small in value, thus showing that the sales rep spent too much valuable time on a small deal when he/she could have spent his/her time more productively. Also, managers should be looking for expansions, up-sells and overall proof that the sales rep has attempted to maximize revenue.

By measuring all of these stages a healthy sales funnel is created.

It is also imperative to do this analysis per rep, per region, per industry per lead generation source in order to get the full picture. 

At every stage it is important to understand exactly why leads did not progress to the next level. This will enable the organization to constantly improve its overall results.

Targets should be set to make sure they motivate the inside sales rep at every stage of the sales process.

‘Gamification’ & ‘SPIFF’ incentive programs are good ways of keeping the team motivated, growing and maximizing their potential.

In a future chapter I will discuss the Soft Skills that should be measured by an Inside Sales Manager / Sales Development Manager.