How does your sales team spend their time? Do they spend most of their day on the phone, sending out prospecting emails to prospects and setting up demos? Or do they waste most of their time on non-sales tasks?
If you are like most sales teams, the last scenario will probably ring a bell. Don't worry, you're not alone. The vast majority of sales teams spend more time than they need to on non-sales activities.
Solving this problem isn't easy: you need to train your sales force to perform better. It's a bit like becoming a top-level athlete: you have to train regularly to improve your performance. Performance is never achieved without training.
Improving sales productivity may seem difficult, but we're here to help. This article will show you how to define, measure and maximize sales productivity. Let's get to work!
What is business productivity?
Sales productivity can be difficult to define. It can mean different things to different sales teams if you get into the details.
But basically, sales productivity is about making more sales with the same amount of resources - like time and money.
This means that sales productivity measures the efficiency and effectiveness of your sales managers. If we analyze this in more detail:
You can think of business efficiency as the input variable for your team. It's the number of resources they use to accomplish their tasks.
Example: You can measure the efficiency of your salespeople by the number of calls they make in a day. Assuming they don't spend more time at work, salespeople who make more calls are more efficient.
Of course, making more calls doesn't necessarily mean making faster sales or generating more revenue. That's why it's also necessary to look at their efficiency and monitor it.
You can think of sales effectiveness as the result of your team. Basically, it's what they do with the resources they have.
Using the example above, measuring the number of appointments booked versus the number of "cold calls" is a measure of your team's effectiveness. They become more efficient if they book more appointments with the same number of calls.
To maximize productivity, your team must be both effective and efficient. This means increasing output while decreasing input.
Quite simply: sales productivity will increase if your team makes more prospecting calls in less time (increasing efficiency) while booking more appointments (increasing effectiveness).
How to calculate productivity?
Unlike other sales-related metrics (LTV, conversion rate, and sales cycle time), there is no specific way to calculate your team's sales productivity.
Instead, you need to use the relationship between sales efficiency and effectiveness that I described above.
This relationship can be translated into a formula as follows:
Sales productivity = sales efficiency (output) / sales efficiency (input)
Let's continue with the productivity example above (booking appointments from prospecting calls) to turn this formula into a specific calculation. We would get this:
Sales productivity = number of appointments booked (the output) / number of calls made (the input)
So if your sales team made 2,000 calls in one week and booked 20 appointments, they would have a sales productivity ratio score of 0.01. In other words, they would have a call-to-appointment conversion rate of 1%.
They can improve their sales productivity by booking more appointments, thus increasing output. If they book 40 appointments, their score increases to 0.02 (2% of calls result in appointments).
They can also improve productivity by booking the same number of appointments with fewer calls. If they book 20 appointments from just 1,000 calls, their score also increases to 0.02.
But what if your sales team increases the number of appointments booked while reducing the number of calls? If they book 40 appointments with only 1000 calls, their score increases to 0.04 (or 4% of calls ending in appointments).
You can also use the calculation to quantify the productivity of your sales team in terms of revenue:
Sales productivity = total revenue / number of salespeople
So if you generate $100,000 over a quarter with a team of ten people, you have a sales productivity calculation of $10,000 per salesperson.
How to improve the productivity of sales teams?
Now that you know what business productivity is and how to calculate it, let's see how you can increase your team's productivity without making them work longer... I've tried, they don't want to... !
1. Define how you want to measure sales productivity in your company.
As we've shown above, you can measure your salespeople's productivity in several ways. To start improving their productivity, you need to define what it means to you.
If you don't yet have an idea of what you want to measure, consider these common indicators:
- Individual sales
- Number of open opportunities
- Number of sales made
2. Track key performance indicators to identify weak points in your sales process
Once you've defined the type of business productivity you want to improve, you need to determine the best way to do it. This means improving your team's efficiency (increasing performance) or making them more efficient (reducing effort). Ideally, you'll do both.
The lead and lag KPIs are a great way to see which of your sales steps need to be improved.
Depending on the definition of productivity chosen in step one, you may consider tracking the following indicators:
- Activity metrics such as calls made, emails sent and demos provided.
- Time spent selling.
- Average response time for prospects.
- Average opportunity size.
- Length of the sales cycle.
- Lost opportunities.
Be careful not to overemphasize activity indicators such as calls made or emails sent. Using only these to measure a salesperson's performance can lead them to artificially inflate these numbers (we know the smart ones). This serves no purpose. Instead, be sure to use them in conjunction with high-impact metrics such as demos completed or opportunities converted.
By tracking these KPIs, you'll undoubtedly realize that your team is making fundamental mistakes, such as not making enough calls or spending too little time selling. You can also identify salespeople with a longer sales cycle than others, which is hampering their sales productivity in relation to established targets.
3. Create a consistent sales process
The best way to improve almost all of the above metrics is to create a consistent sales methodology. Define a list of steps your team must follow to convert a prospect into a buyer.
Defining a clear sales method is essential. The only difference between a productive and a non-productive salesperson is what they do with their time.
One way to create a consistent sales method is to identify the steps taken by your top performers and encourage everyone to adopt them. Sales management is also the key to boosting the performance of your sales force. Sales managers, sales executives, directors, etc., don't neglect this essential point!
Another is to take inspiration from this sales playbook to master your sales cycle that we created from our own playbook at Modjo.
4. Automate manual tasks
Your salespeople spend more time on non-sales activities than on sales. It's a fact!
Tasks such as updating CRMs, entering activities, and planning the day waste your teams' time and make them unproductive.
Fortunately, you can solve this problem by automating manual tasks. Many administrative tasks can be automated by connecting your CRM and sales productivity tools.
Alternatively, you can use Livenotes by Modjo so that your salespeople can fill in clean and accurate data with notes that automatically sync with the CRM so that it is always up to date.
For example, during a demo, sales people can select a template and get a summary of the major steps not to be missed. With the functionality of adding CRM fields directly in the application and the template, they can modify the CRM in 1 click and not have to come back to it after the meeting. Simple and basic but devilishly effective.
5. Improve the onboarding of new recruits.
The sooner you can get new recruits up to speed, the sooner they'll be able to contribute to the sales pipeline and reach your sales targets, especially by converting new customers.
Quality onboarding is essential for improving sales productivity, especially if you measure it in terms of revenue per salesperson.
But rushing the training is not the answer. Onboarding should be more than a one-week crash course on selling in your company. That's why we've created The Sales Onboarding Guide broken down as follows:
- Preparing for the arrival
- Familiarize yourself during the first week.
- Increased competence in the first month.
- Master after one term.
- Pass on after 12 months.
Even if we've created this guide for newcomers, all your sales reps need regular reminders and coaching sessions to keep improving, especially if you want them to stick to your sales method - and yes, loyalty is everything.
Save time by using a tool like Modjo to identify your reps' problems and solve them quickly. For example, you can use Modjo to:
- Identify which reps are talking too much and which are not talking enough.
If your reps are talking more than they are listening, they need a coaching session ASAP ... - Highlight the topics most discussed by top salespeople.
Modjo found that top salespeople discussed objection-related topics 3 times more than others.
- Share the best calls and the worst... Many times this works best for awareness.
Use sales tools!
Adding additional resources to your sales process may seem counterproductive at first. After all, you'll be increasing resources and reducing their efficiency. However, the power of certain tools to automate parts of the sales process, dramatically improve engagement and shorten sales cycles means they can increase your team's productivity.
Unfortunately, most teams today lack the tools they need to succeed. And while we're talking about salespeople, sales managers are not to be outdone. Only half of all sales managers feel equipped with the tools they need to succeed.
Start by evaluating your stack of tools to see which ones improve the sales process/sales techniques, how effective they are, and whether they are being used effectively by salespeople. Remove tools that don't improve productivity, but also look to adopt tools that make you more efficient.
In particular, adopt the following types of tools if you have not already done so:
- The basic tool: A CRM
- The "game changer" tool: A sales productivity platform
- The essential: A VoiP and/or videoconferencing tool
- Bonus: An automation tool.
The sales tech market is evolving rapidly, so make sure you regularly evaluate your stack of tools and identify levers for improving productivity.
Improve your business productivity with Modjo
If you want to improve the productivity of your sales team, you need to start by defining it. Only then can you decide on the best performance indicators to track your improvement and start implementing some of the above strategies.
Whatever your approach, don't underestimate the power of sales tools. If you think that introducing another tool into the process will waste more time for you and your salespeople, the opposite is often true.
A tool like Modjo can provide you and your team with insights to accelerate the introduction of new sales reps, improve conversations with customers, boost your customer relations with precise insights and ultimately make more sales.
If you want more information on how Modjo can help revolutionize your sales process, feel free to request a demo.
Best,
