Your sales team’s productivity impacts your business; higher productivity increases revenue. However, if your salespeople hit a slump or plateau, it can impact profitability in the opposite direction.
In this article, we’ll show you how to determine what factors are impacting sales productivity and choose the right strategies to help your team move forward.
We’ll start by looking at what sales productivity is, what key performance indicators (KPIs) to use when tracking it and why it’s so important to measure if you want your business to thrive.
Why is measuring sales productivity important?
Sales productivity quantifies how effective sales reps are at generating revenue. You can measure it through the performance of individual reps or your entire sales team and many companies often do both at once.
Sales productivity ties directly into your business’s bottom line. To improve it, and by extension, improve your overall income, you’ll need to quantify certain indicators.
Measuring productivity gives you a chance to both identify problem areas and formulate the right strategy to correct them.
Keep the following goals in mind when improving productivity:
Giving reps more time to sell
Making sure time spent selling is as efficient as possible
How you do that will depend on the specific bottlenecks your business faces.
But honing your team into a well-oiled machine will increase morale because your reps get to spend more time doing their jobs.
How to measure sales productivity
To form an accurate picture of your team’s productivity, consider its sales efficiency and sales effectiveness.
Sales expert Jason Jordan mapped out a helpful formula for determining sales productivity: the sum of your team’s efficiency multiplied by its effectiveness.
Sales efficiency is the number of sales opportunities that get converted into won deals in a given timeframe. To measure it, you can look at several narrowly focused indicators like:
Individual performance
Revenue generated per hour of work
Missed/exceeded quotas
As you examine your reps’ performance, you may find areas in the buyer’s journey that present roadblocks. An overly drawn-out sales process might cause potential customers to become frustrated or lose interest and back out midway.
If you discover that’s a problem for your team, you’ll want to focus on strategies that cut down the time spent at each stage of the funnel. Or even remove stages from your process altogether if they don’t help.
Sales effectiveness measures how well reps close deals and generate income. You can apply it to individual methods your reps use to see how well a certain task or technique works to close a sale.
If 70% of your reps found live product demos helped them close a deal, that would be an effective sales strategy.
Try asking questions like these to help identify bottlenecks and obstacles you can use as a starting point:
How long does it take to onboard a new sales rep?
Where in the sales process do deals tend to stall out?
How much of a rep’s day is spent in meetings or on administrative tasks?
What’s the average time it takes to close a deal?
Do reps use content? If so, how long do they spend making it or searching it out?
The answers will help you define exactly what is limiting your team. From there, you can start to increase sales productivity.
The sales productivity metrics you measure will fall within the category of effectiveness or efficiency. Common examples include:
Number of sales made per hour worked
Number of sales per contact
Number of sales per rep
You can also use the formula:
Total team revenue ($) for a period ÷ Number of reps on your team in that period = Team sales productivity
So, if you had $15,000 in revenue for a given quarter and five sales reps on your team, your team productivity figure would be $3,000 per rep.
The easier you can track this kind of data, the easier it will be to measure. With a customer relationship management (CRM) system, you can put together performance dashboards while tracking call length and goal progress. These strategies simplify the performance tracking process.
Common challenges to sales productivity
One of the most common obstacles to sales productivity is time; reps don’t have enough of it to spend on selling. Administrative tasks and meetings cut into the time a rep would otherwise have to do their main job.
However, that’s not the only thing getting in the way. Other common roadblocks include:
A vague sales process. If reps or sales managers don’t have a clear understanding of each stage of the sales funnel, that can impact productivity. Everyone on your team must know what’s expected of them and how to move people through the sales cycle with the least friction.
Little to no qualified leads. You could have an amazing product for your niche but be talking to the wrong people. A small group of highly qualified (already interested) leads is a better use of resources than a larger number that don’t fit. Companies that go after poor-fit leads end up wasting valuable resources and impacting sales productivity.
Unrealistic sales goals. Goal-setting is important for any business, but your targets need to be smart and attainable. Overworking your team in the pursuit of unattainable quotas will lead to burnout instead of inspiring employees to work at their best.
Repetitive tasks. Writing emails, responding to messages and entering data often take up a large portion of a sales rep’s day despite not yielding revenue or being directly related to their work.
Thankfully, there are plenty of actionable strategies you can use to identify these problems and work through them.
Strategies to improve your team’s sales productivity
Now that you know how to measure sales productivity and identify obstacles, it’s time to develop an improvement strategy. Here are some actionable tips you can start using today to maximize your sales team’s effectiveness.
1. Get your people the right training
You want to get your people up to speed and selling fast. Pairing efficient onboarding practices with ongoing coaching and mentorship is the way to make that happen.
Programs like remote coaching can help your reps develop and learn new skills even after months or years on the job. Remote coaching is even more vital for distributed workforces.
Instead of giving reps long, one-sided presentations full of slides to read, opt for shorter 15–20 minute interactive sessions. Reps can then hone their technique while maintaining focus.
Walking through sales activities with a mentor gives reps hands-on practice they can use in the field. Personalized coaching also lets your reps advance at their own pace depending on the skills they’ve developed.
Data like weekly sales reports can show you where each rep is strong and where they need to develop their skills. Look at:
How well they identify suitable leads
How well they prioritize those leads
How often a rep contacts their leads
How efficiently they carry out the above steps
Use that information to develop an effective sales training plan focusing on any weak points and how to turn them into strengths.
If a rep spends a lot of time doing in-person visits but doesn’t close a lot of deals, they’re probably spending too much time on unqualified leads. So, their training plan should focus on helping them determine who is a suitable lead.
2. Build consistent and flexible sales processes
Once you train your reps, they need a framework they can use to implement that training. A structured sales process provides a scaffold your team members can build upon.
It’s important to have a flexible structure. That way, your reps can feel empowered to make judgment calls should the need arise.
Make the process repeatable, but don’t adhere to the same rigid steps for every interaction. Look at your sales process from an object-oriented perspective. Map the end goal and the points on the route to that goal, then devise processes to fit them.
Predefined steps for different points in the sales journey allow reps to adjust quickly while working toward the end goal: making the sale.
Create standardized procedures for sales tasks that reps do regularly. Define the steps clearly in your sales funnel and have a set process for guiding new leads through each one of those steps. Every rep on the team must be familiar with that process.
Reps should only move a lead to the next stage of the sales process when they’re ready. Make sure they know the specific actions a lead takes that signal readiness to move forward. It’s then less likely a lead will exit the sales funnel prematurely.
You don’t have to reinvent the wheel, but it’s worth the effort to take these steps. You can replicate and optimize what works while removing what doesn’t help.
Look at your highest-performing reps. What are they doing well? See if you can add what they’re doing into your process for everyone to use.
3. Reduce time spent on administrative tasks and meetings
Tasks not related to selling are among the biggest time-sucks your reps face in their day-to-day work. However, the right sales productivity software can help you get that time back. A study of over 70 companies by McKinsey and Co. found that sales leaders who utilized artificial intelligence (AI) and marketing automation software opened up 20% more sales team capacity.
Using a sales CRM system helps automate multiple tasks, from email drip campaigns to follow-up reminders. They come with templates and integrations you can use as is or customize to suit your goals.
Try using pre-written sales scripts to save your reps time on calls. Having some talking points or prepared answers to frequently asked questions can give your team more confidence and guide the conversation.
Good CRMs also offer analytics tools and reporting that turn the data you get from customers into actionable insights. Instead of tracking every lead your team contacts manually, you could run a conversion report using Pipedrive’s analytics to see which deals closed, how they closed and where those leads originated.
To get an idea of exactly what it is that’s taking up the most time during a rep’s day, look at factors like:
The time they spend traveling between sales visits
How long internal team meetings take
Time spent on sales calls
Amount of face-to-face time with customers
Time spent on administrative tasks like data entry and emails
Time spent tracking their sales pipeline
Time spent prospecting for new leads
Have your staff track their time and report back, using that data to decide what you automate. Let your team know you aren’t trying to call anyone out; you only want to get a picture of how they spend their time as a whole.
A recent study by Microsoft listed inefficient meetings as the number one detriment to workplace productivity. Look at how many meetings you’re having, how regularly you’re meeting and how long those meetings last. Chances are you could cut them back or eliminate them and share the information in a company-wide email.
You can still meet in person for the essential things, but you might be surprised by how much time your team gets back solely by making this change. Get tips to plan your next sales meeting here.
4. Align your sales and marketing departments
Sales and marketing need to work together; marketing brings in the leads and sales converts them.
If they’re out of sync, you could end up with a marketing team that isn’t sure which leads to bring in and a sales department that can’t convert leads effectively because they aren’t a good fit.
However, businesses with well-integrated sales and marketing departments are almost twice as likely to meet their growth goals.
Aligning your sales and marketing teams means collaboration on a joint strategy to increase sales enablement. Both teams have input on the strategy, their goals and what steps they’ll take to meet those sales goals.
If your company has a certain sales pipeline revenue goal in mind, sales and marketing can collaborate on tactics to reach it like:
How many leads to bring in
How many demos are necessary
How many calls or in-person meetings to schedule
A simple example of this in action is your marketing team creating content for each stage of the customer journey, which your sales team then shares to bring in prospects.
Set up regular check-ins between your sales and marketing teams to ensure they’re both still working toward the same goal. Keep the above point about constructive meetings in mind.
Discussing factors like conversion rates and lead quality will help fine-tune the strategy going forward so teams can focus on people more likely to convert into paying customers.
Have your teams collaborate on elements of strategy like:
Identifying pain points
Segmenting leads by conversion rate
Sharing analytics, reports and data
Again, alignment between these departments is crucial because their functions go hand-in-hand. With insight from sales, marketing can create more effective content for campaigns that attract better leads.
5. Measure your progress
After each successful tweak to your strategy, measure sales productivity to see how much progress you’ve made.
You can get valuable insight into where your team is improving by tracking factors like:
Individual rep performance
Team performance
Coaching progress
What content your teams choose to share
See where they still have room to grow and any roadblocks standing in the way of improved productivity.
CRM software includes sales productivity tools like customizable dashboards, pipeline management and lead scoring to help you review and track all the information you need to analyze your sales productivity.
Checking your progress regularly will help your business stay adaptable because you can’t know what to improve if you don’t measure. Check progress, identify bottlenecks and adapt as needed.
Final thoughts
Sales organizations should always track their effectiveness and efficiency to see what they can improve. If sales performance falls short of your expectations, look for the weak points. Support your reps with the coaching they need to put new, more effective methods into practice.
Examine individual and team performance, learn from your highest earners and always track your progress. CRM software provides many of the sales tools you need to achieve these goals, so consider investing in technology for your team.
