Sales activities are the only controllable metrics we have.
Sure, we influence results metrics like revenue and market share by performing specific activities. But we cannot directly affect them. If sales leaders could control business results, then teams would hit quota every single quarter for the rest of time.
That’s why there’s a major shift occurring in modern organizations toward managing sales activities, instead of results. It’s an inputs-drive-outputs approach, and sales leaders are seeing tangible ROI. Here’s what managing sales activities could do for your team.
3 Steps to More ROI from Sales Activities
1. Define critical sales activities.
These are unique to every organization, but research reveals the most common sales metrics for each type of team.
Outline the structure of your sales team. Where do all of the roles fit into the sales process? What is each employee’s objective, and how do they achieve it? Develop a hypothesis of the right activity metrics, then interview salespeople and managers for their opinion.
A sales rep’s critical activities might be meetings, ROI discussions, proposals sent and wins. But for a customer success rep, they’re probably opportunities created, client meetings, milestones completed and upsells.
Map out the activities in your sales process and record monthly activity levels.
2. Calculate funnel conversion rates.
Use the activity data to determine the conversion rate between each step of your sales process.
Let’s say these are the average monthly activity levels for a sales rep:
- 40 Meetings
- 20 ROI Discussions
- 5 Proposals
- 1 Deal
Based on this data, calculate the percent of opportunities that make it from one stage to the next.
( 20 ROI Discussions / 40 Meetings ) x 100 = 50%
( 5 Proposals / 20 ROI Discussions ) x 100 = 25%
( 1 Deal / 5 Proposals ) x 100 = 20%
Reverse engineer your sales process to determine how much of each activity you need to hit sales goals.
Here’s an example: Last year, your team brought in $60 million in sales, and your CEO wants to see a 20 percent revenue growth this year. You now need $72 million. If your average deal size is $50,000, then the sales team has to close 1,440 deals.
$72,000,000 Revenue / $50,000 Average Deal Size = 1,440 New Deals
Based on your conversion rates, your team will need 7,200 proposals, 28,800 ROI discussions and 57,600 meetings. Those numbers are intimidating. Divided among a sales team of 100 reps over a period of 12 months, and they become achievable:
- 48 Meetings / month
- 24 ROI Discussions / month
- 6 Proposals / month
- 15 Deals / year
But how can you increase activity levels? Not by asking sales reps to “do more.” Instead, guide them with sales activity management.
3. Determine ROI potential.
The example above shows a 20 percent increase in activities. Here’s what 30 percent looks like:
- 52 Meetings / month
- 26 ROI Discussions / month
- 8 Proposals / month
- 20 Deals / year
If each of the 100 sales reps closes 20 deals a year at an average deal size of $50,000, your sales number jumps to $100,000. That’s a 60 percent increase in new revenue. And it’s achievable.
With personal scorecards, automated activity tracking and pacing alerts, a sales activity management system enables you to switch your focus to the sales activities that lead to closing more business. There’s data to prove it. Find out what other results modern sales leaders are seeing when they adopt sales activity management, and start your own transition to modern sales management.