When it comes to sales, data is king. Having accurate information oftentimes is the difference between a decision that propels your company into the future and one that can be disastrous. Organizational data starts from the ground up, which for most organizations means your sales teams. Sales team data often falls into one of two buckets, sales performance management (SPM) or forecasting. In this article we will cover both, why they’re important, and how to get the most accurate data from your team.

SPM

What is Sales Performance Management?

According to Salesforce, “Sales performance management (SPM) is a process that helps sales organizations track, manage, and improve the work of their sales teams. This includes everything from forecasting to implementing training programs, monitoring activities, quota management, and incentive planning”.

Sales performance, simply put, is how effective your sales team is. This ultimately depends on the selling strategies employed by both the individual representative and the entire team, as well as their ability to achieve their targets.

The primary goal of SPM is to ensure that sales teams are aligned with organizational objectives and are equipped to meet, and exceed, sales targets. It provides a structured way for businesses to enhance their sales processes, optimize revenue generation, and ensure that their teams are motivated and high-performing.

SPM is not just about monitoring performance; it also involves creating a supportive environment where your sales teams can thrive. By utilizing data-driven insights, SPM helps managers make informed decisions about training needs, compensation plans, and resource allocation.

Why is Sales Performance Management important?

Sales Performance Management is vital for a multitude of reasons, but for our purposes, we’re going to break it into two distinct categories: data-driven decision making, and improved team culture.

Data-Driven Decision Making

SPM relies on the constant collection and analysis of performance data. By leveraging this data, managers can make more informed decisions regarding resource allocation and what their team needs to produce at the highest level. For example, if the managers realize that the majority of failed calls end at a certain point in the conversation, they can identify that step in the process as an inefficiency and provide training to remedy it. The same can be true if certain keywords or phrases are used in a high percentage of successful calls, they are able to take that information and apply it to the rest of the team.

According to a McKinsey study of sales organizations “53 percent of those that are ‘high performing’ rate themselves as effective users of analytics”. Data is vital when it comes to making decisions, and proper sales performance management provides the necessary information organizations need to point themselves in the correct direction.

Improved Team Culture

Sales Management is the foundation to creating an amazing team culture. Proper SPM empowers great leaders to create trust, transparency, and clear communication. When managers are able to accurately track the results of their sales reps, there is an increase in productivity and efficiency. A rep is able to look at their numbers and know exactly where they stand. There is transparency in their performance, allowing them to self-critique and find areas to improve. This also gives managers insight into where their team may be struggling, allowing them to provide targeted and specific coaching.

This combination of factors allows the team to feel like they are part of something special. 90% of sales managers believe that a positive sales culture is important to a sales rep’s job satisfaction (Hubspot), which results in lower turnover, happier employees, and reps going above and beyond expectations. This environment creates a space for motivation and positive morale, which in turn creates better reps who drive results.

How to Ensure You Receive Accurate Sales Performance Measurement Numbers?

This requires a structured approach that is grounded in collecting accurate data, verification, and inspections. In the inside sales industry (which is what we do at Salelytics) we utilize call listening, which includes reviewing audio and screen captures to ensure accurate sales data is collected. Call listening audits are conducted by the quality assurance team, our clients, and each program's leaders. Regular feedback is provided to the team to ensure they understand the importance of accurately recording customer data in our CRM.

Forecasting

What Is Forecasting?

According to LinkedIn, “A sales forecast is an estimate of expected sales revenue within a specific time frame, such as quarterly, monthly, or yearly. It expresses how much a company plans to sell”. Simple in concept, but extraordinarily important in execution.  

Why Is Forecasting Important?

Forecasting is a vital piece of operational planning. It creates the foundation for team staffing, budgets, and allows leadership to create clear and concise sales goals for the team members. In fact, research from the Aberdeen Group found that companies with precise sales forecasts had 13.4% more year-over-year growth compared to companies with inaccurate estimates (Salesloft). Accurate sales forecasting is essential to understanding potential revenue, managing inventory, and allocating resources. So much so that according to Salesloft, companies with accurate sales forecasts are over 7% more likely to hit their revenue and sales quotas.

How To Ensure You’re Receiving Accurate Results?

Ensuring you’re generating accurate sales forecasts is just as much of an art as it is a science. You have to consider your current deals in the pipeline, how many of those prospective deals your team closes, and other related information that can typically be gleaned from your CRM. You then have to pair that with historical data, and current events/trends that may impact the future state of the forecast provided. This is also a great time to reflect on lessons learned from previous forecasting cycles and factor those into your calculations. Having tenured leaders among your ranks is a major advantage when it comes to forecasting, so be sure to work them into the process to create the most accurate results.

How Salelytics Does Both To Provide You With Clarity And Drive Results

At Salelytics our motto is driven by data, powered by people. With our data-driven insights and dedicated inside sales teams, we help generate results for you!

Every interaction our inside sales teams make is recorded, documented, and analyzed, allowing us to adapt quickly and provide world-class service. With over three decades of experience, our tenured leadership team takes the information generated by our frontline reps, and combined with their industry expertise, generates forecasts that help move your organization forward.

Want to learn more about how our customizable solutions can help you? Click here to schedule a no-strings-attached call to get more information!

Conclusion

In the world of sales, accurate data is the key to making smart decisions and achieving long-term growth. Sales performance management and forecasting play a vital role in equipping sales teams with the tools they need to hit targets and exceed expectations. By leveraging insights from SPM and robust forecasting, organizations can create a more cohesive, motivated, and data-driven team culture. When executed well, these strategies drive better decision-making, higher productivity, and a clear path toward organizational success.