Sales Webinar | The Global Sales Industry - Where to Spend Your Time in 2013
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Are you looking for a simple way to see how your sales organization compares? Do you want the inside track on how you should best compete in 2013? Preview our global sales effectiveness survey, covering the global trends in sales success, how the world's major sales industries compare, and the best selling opportunities in your region.
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Sales Webinar | The Global Sales Industry - Where to Spend Your Time in 2013
- 1. The Global Sales Industry – Where to Spend Your Time in 2013 Paul Dilger – Director, Product Marketing, The TAS Group
- 2. Introductions Will Wiegler Chief Marketing Officer The TAS Group Paul Dilger Director, Product Marketing The TAS Group © The TAS Group 2012
- 3. © The TAS Group 2012
- 4. Agenda • What is the Dealmaker Index? • Global findings • How you can use the Index • Summary © The TAS Group 2012
- 5. About the Dealmaker Index Dealmaker Index is a global free service for sales professionals and their companies to assess their sales effectiveness, gain advice on how to improve, and compare their performance with their peers. © The TAS Group 2012
- 6. About the Sales Velocity Equation www.thetasgroup.com/white-papers © The TAS Group 2012
- 7. Respondent Profile Sales B2C Operations/ Other Enablement 12% 17% 10% B2B2C Sales 10% Executive Manager 8% 23% B2B Account 78% Manager Sales Exec 20% Leadership Field Sales 15% 8% Business Type Respondent Role © The TAS Group 2012
- 8. Respondent Profile Huth- waite Miller Female 4% 5% Heiman Solution 14% TAS Selling 9% 28% Don’t Know 8% 21-30 60+ Male 6% 5% In-House 86% Other 13% 31-40 51-60 23% None 25% 11% 23% Gender Methodology 41-50 41% Age © The TAS Group 2012
- 9. Respondent Profile South America 3% UK 7% Eurozone 17% E. Europe North America 57% MEA 1% 6% APAC 9% Region © The TAS Group 2012
- 10. Respondent Profile Financial Services Teleco Energy & 2% Power Healthcare 9% 5% 10% Professional Services 15% High Technology Other 16% 25% Industrials 18% Industry Sector © The TAS Group 2012
- 11. Respondent Profile Blank 1% $10bn + $5bn - $10bn 2% 15% >$20m $1bn – $5bn 34% 10% $500m – $1bn 6% $100m – $20m – $500m $50m $50m – 10% $100m 12% 11% Revenue Range © The TAS Group 2012
- 12. Agenda • What is the Dealmaker Index? • Global findings • How you can use the Index • Summary © The TAS Group 2012
- 13. Individual Quota Attainment 35 32 30 27 25 20 15 15 12 10 5 5 5 3 2 0 Average % achievement against quota in the last 3 years Source: Dealmaker Index November 2012 © The TAS Group 2012
- 14. Team Quota Attainment 40 35 34 31 30 25 21 20 15 14 10 5 0 <25% 25-50% 50-75% 75-100% Percentage of sales team that achieved quota Source: Dealmaker Index November 2012 © The TAS Group 2012
- 15. Win Rate 40 37 35 34 30 25 20 17 15 11 10 5 0 <25% 25-50% 50-75% 75-100% % of qualified opportunities that results in a sale (win rate) Source: Dealmaker Index November 2012 © The TAS Group 2012
- 16. Sales Cycle Length 35 32 30 27 25 21 20 15 15 10 5 5 5 3 0 < 1 Month 1-3 4-6 6 - 12 > 12 150-200% Don't Months Months Months Months Know Typical length of sales cycle Source: Dealmaker Index November 2012 © The TAS Group 2012
- 17. Forecast Accuracy 60 50 50 40 35 30 20 9 10 6 0 Agree Strongly Agree Disagree Disagree Strongly We usually close deals as originally forecasted (accuracy) Source: Dealmaker Index November 2012 © The TAS Group 2012
- 18. Sales Force Turnover 35 30 29 25 20 19 18 17 15 13 11 10 5 6 5 0 Don't < 5% 5-10% 11-15% 16-20% 21-25% 26-30% > 30% Know Percentage sales team turnover in the last 12 months Source: Dealmaker Index November 2012 © The TAS Group 2012
- 19. Impact of Strategy Contribution on Quota Question: Sales organization contributes significantly to overall company strategy 100% Neutral Neutral Neutral Neutral Disagree 80% Disagree Disagree Strongly Agree Strongly Agree 60% Strongly Agree Strongly Agree 40% Agree 20% Agree Agree Agree Quota Achievement : <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 20. Impact of Strategy Contribution on Quota Question: Sales organization contributes significantly to overall company strategy 100% 80% 60% 40% 20% Quota Achievement : <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 21. Impact of Alignment on Quota Achievement Question: Sales and marketing organizations work well together 100% Neutral Neutral Neutral 80% Neutral Disagree 60% Disagree Disagree Disagree Strongly Agree Strongly Agree 40% Strongly Agree Strongly Agree 20% Agree Agree Agree Agree Quota Achievement : <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 22. Impact of Alignment on Quota Achievement Question: Sales and marketing organizations work well together 100% 80% 60% 40% 20% Quota Achievement : <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 23. Impact of Alignment on Win Rate Question: Sales and marketing organizations work well together 100% Neutral Neutral Neutral Neutral 80% Disagree 60% Disagree Disagree Disagree Strongly Agree Strongly Agree Strongly Agree Strongly Agree 40% 20% Agree Agree Agree Agree Win Rate: <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 24. Impact of Alignment on Win Rate Question: Sales and marketing organizations work well together 100% 80% 60% 40% 20% Win Rate: <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 25. CRM / Methodology Usage Question: What percentage of the sales team uses the CRM / methodology? 70% 60% CRM Methodology 50% 40% 30% 20% 10% Usage: <25% 25-50% 50-75% 75-100% Don’t Know © The TAS Group 2012 Source: Dealmaker Index November 2012
- 26. Why Methodology Is Not Used Question: Companies with a sales methodology- When the methodology is not used, what is the reason? Only some people in the company use it What was learned has been forgotten Not integrated with the CRM Too hard to use No automation – too much manual effort It doesn’t really help sell No real value to me It doesn’t help me with sales forecasting 5% 10% 15% 20% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 27. Impact of Methodology Integration to CRM Question: Our sales methodology is effectively integrated with our CRM 100% Neutral Neutral Neutral Neutral 80% Strongly Disagree Strongly Disagree Strongly Disagree Strongly Disagree 60% Disagree Disagree Disagree Disagree 40% Strongly Agree Strongly Agree Strongly Agree Strongly Agree 20% Agree Agree Agree Agree Quota Achievement : <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 28. Impact of Methodology Integration to CRM Question: Our sales methodology is effectively integrated with our CRM 100% 80% 60% 40% 20% Quota Achievement : <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 29. Impact of Methodology on Win Rate Question: What percentage of the sales team uses the methodology? 100% <25% <25% <25% 80% 25 – 50% <25% 25 – 50% 60% 25 – 50% 50 – 75% 25 – 50% 40% 50 – 75% 50 – 75% 50 – 75% 75 – 100% 20% 75 – 100% 75 – 100% 75 – 100% % Qualified Opportunities Convert To Sale : <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 30. Impact of Qualification on Quota Achievement Question: Sales is effective at qualifying opportunities 100% Neutral Neutral Neutral 80% Neutral Disagree 60% Disagree Strongly Agree Strongly Disagree Disagree Strongly Agree Strongly Agree Disagree 40% Strongly Agree Agree 20% Agree Agree Agree Quota Achievement : <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 31. Impact of Qualification on Quota Achievement Question: Sales is effective at qualifying opportunities 100% 80% 60% 40% 20% Quota Achievement : <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 32. Impact of Methodology on Forecast Accuracy Question: What percentage of the sales team uses the methodology? 100% <25% <25% <25% <25% 25 – 50% 80% <25% 25 – 50% 50 – 75% 25 – 50% 60% 25 – 50% 50 – 75% 25 – 50% 40% 50 – 75% 50 – 75% 75 – 100% 75 – 100% 20% 75 – 100% 75 – 100% 75 – 100% Close Deals as Forecasted : Strongly Disagree Disagree Neutral Agree Strongly Agree © The TAS Group 2012 Source: Dealmaker Index November 2012
- 33. Impact of Sales Process on Quota Question: Our sales process is well defined 100% Neutral Neutral Neutral Neutral 80% Strongly Disagree Disagree Strongly Disagree Disagree 60% Disagree Disagree Strongly Agree Strongly Agree Strongly Agree 40% Strongly Agree Agree 20% Agree Agree Agree Quota Achievement : <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 34. Impact of Sales Process on Quota Question: Our sales process is well defined 100% 80% 60% 40% 20% Quota Achievement : <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 35. Impact of Sales Process on Win Rate Question: Our sales process is well defined 100% Neutral Neutral Neutral Neutral 80% Disagree Strongly Disagree Disagree Disagree 60% Disagree Strongly Agree Strongly Agree Strongly Agree 40% Strongly Agree Agree 20% Agree Agree Agree Win Rate: <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 36. Impact of Sales Process on Win Rate Question: Our sales process is well defined 100% 80% 60% 40% 20% Win Rate: <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 37. Impact of Sales Process on Forecast Accuracy Question: Sales process is well understood and executed by the sales team 100% Neutral Neutral Neutral Disagree Neutral Neutral 80% Disagree Strongly Disagree Agree Strongly Disagree 60% Strongly Agree Disagree Strongly Agree Disagree Strongly Agree 40% Disagree Strongly Agree Agree Strongly Agree 20% Agree Agree Agree Agree Close Deals as Forecasted : Strongly Disagree Disagree Neutral Agree Strongly Agree © The TAS Group 2012 Source: Dealmaker Index November 2012
- 38. Impact of Sales Process on Forecast Accuracy Question: Sales process is well understood and executed by the sales team 100% 80% Agree 60% 40% 20% Close Deals as Forecasted : Strongly Disagree Disagree Neutral Agree Strongly Agree © The TAS Group 2012 Source: Dealmaker Index November 2012
- 39. Theory vs Practice Question: How important is competency in Question: We are effective at maximizing Key Account Planning and Management? the potential from our major accounts 50% 35% 30% 40% 25% 30% 20% 20% 15% 10% 10% 5% Not Somewhat Very Disagree Strongly Essential Disagree Neutral Agree Important Important Important Strongly Agree © The TAS Group 2012 Source: Dealmaker Index November 2012
- 40. Theory vs Practice Question: How important is Question: Our sales forecast is a critical competency in Sales Forecasting? component of our overall business planning 50% 40% 40% 30% 30% 20% 20% 10% 10% Not Somewhat Very Disagree Strongly Essential Disagree Neutral Agree Important Important Important Strongly Agree © The TAS Group 2012 Source: Dealmaker Index November 2012
- 41. Theory vs Practice Question: How important is Question: Our sales pipeline gives an accurate competency in Pipeline Management? picture of future business 50% 40% 40% 30% 30% 20% 20% 10% 10% Not Somewhat Very Disagree Strongly Essential Disagree Neutral Agree Important Important Important Strongly Agree © The TAS Group 2012 Source: Dealmaker Index November 2012
- 42. Theory vs Practice Question: Which Stage is Most Difficult? Most Important? 50% Most Difficult Most Important 40% 30% 20% 10% Qualification Needs Analysis Solution Negotiation Closing Presentation © The TAS Group 2012 Source: Dealmaker Index November 2012
- 43. Theory vs Practice Question: Which Stage is Most Difficult? 50% Needs Analysis Stage Most Important Other Stage than Needs Analysis 40% Most Important 30% 20% 10% Qualification Needs Analysis Solution Negotiation Closing Presentation © The TAS Group 2012 Source: Dealmaker Index November 2012
- 44. Theory vs Practice Question: Our Customer Retention is Satisfactory 90 Disagree Strongly 80 Disagree 70 Neutral # of Companies 60 Agree Agree Strongly 50 40 30 20 10 Quota Achievement : <25% 25 – 50% 50 – 75% 75 – 100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 45. Dealing with Competition Our sales strategy effectively deal with competition Our sales organization is effective at differentiating against competition I can clearly differentiate my product against the competition I develop a separate competitive strategy for all of my main opportunities 50% 40% 30% 20% 10% Disagree Disagree Neutral Agree Agree Strongly Strongly © The TAS Group 2012 Source: Dealmaker Index November 2012
- 46. Use of Social Networks Question: Which B2B Social Network is Most Valuable? 60% 50% 40% 30% 20% 10% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 47. LinkedIn Activity by B2B Industry 80% 70% 60% 50% 40% 30% 20% 10% Energy Healthcare High Industrials Other Professional Telecom- And Power Technology Services munications © The TAS Group 2012 Source: Dealmaker Index November 2012
- 48. Facebook Activity by B2B Industry 80% 70% 60% 50% 40% 30% 20% 10% Energy Healthcare High Industrials Other Professional Telecom- And Power Technology Services munications © The TAS Group 2012 Source: Dealmaker Index November 2012
- 49. Twitter Activity by B2B Industry 80% 70% 60% 50% 40% 30% 20% 10% Energy Healthcare High Industrials Other Professional Telecom- And Power Technology Services munications © The TAS Group 2012 Source: Dealmaker Index November 2012
- 50. Setting the Bar High Superstar: Methodology & CRM usage > 50%, and Sales Process Defined, Method Well Integrated to CRM 50% Others 40% Superstars 30% 20% 10% Quota Achievement : <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 51. Setting the Bar High Superstar: Methodology & CRM usage > 50%, and Sales Process Defined, Method Well Integrated to CRM 50% Others 40% Superstars 30% 20% 10% Win Rate: <25% 25-50% 50-75% 75-100% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 52. Setting the Bar High: What’s the Delta? Superstar: Methodology & CRM usage > 50%, and Sales Process Defined, Method Well Integrated to CRM 100% Others 80% Superstars +78% 60% +108% 40% 20% Quota Achievement Win Rate > 50% > 50% © The TAS Group 2012 Source: Dealmaker Index November 2012
- 53. Avoid the Delta of Disappointment When Processes, Methodology and Technology Collide 50% 75-100% 40% 50-75% Quota Achievement 30% Delta of Disappointment 20% 10% 25-50% < 25% # of Best Practices Used : 1 2 3 4 © The TAS Group 2012 Source: Dealmaker Index November 2012
- 54. Agenda • What is the Dealmaker Index? • Some global conclusions • How you can use the Index • Summary © The TAS Group 2012
- 55. Social Media The impact on a customer of a bad buying decision … is greater than Impact to businesses the impact on a sales person of a lost sale all sizes, all industries © The TAS Group 2012
- 56. © The TAS Group 2012
- 57. © The TAS Group 2012
- 58. © The TAS Group 2012
- 59. How you can use Dealmaker Index 1. Get your own score and advice 2. Compete with your peers or uncover different competencies in your company 3. Assess your company and get advice on how the company could improve 4. Learn the different internal perspectives on how the company performs 5. Use during the hiring process © The TAS Group 2012
- 60. Dealmaker Index Study 2012 © The TAS Group 2012
- 61. Summary • Alignment, process and methodology help you improve quota and win rate • Specific opportunities exist to improve sales performance • Dealmaker Index will help you improve © The TAS Group 2012
- 62. The TAS Group. Sell Smarter. Manage Better. © The TAS Group 2012
- 63. Register for our Next Webinars and Events • [Virtual Customer Event] November 15th – Dealmaker Mastery Series (Measuring Success, Jim Crisera, President and CFO) • [London] November 22nd and 23rd – Sales Director Live • [London] November 28th Xactly | Pull the Right Sales Incentives Out of your Hat © The TAS Group 2012
- 64. Free Resources www.dealmakerindex.com Score your sales effectiveness. Get advice. See how you compare. www.dealmakergenius.com Create a customized sales process. www.dealmaker365.com Read our blog featuring insights on sales effectiveness. @dealmaker365 @thetasgroup Follow us on Twitter. www.thetasgroup.com Learn more on our website. © The TAS Group 2012
- 65. Questions? © The TAS Group 2012
- 66. Where You Can Find Us www.thetasgroup.com • US 866.570.3836 • UK +44(0)1189 880 149 • International +353(0) 1 6788 900 • marketing@thetasgroup.com • Twitter: @thetasgroup © The TAS Group 2012
- 67. The Global Sales Industry – Where to Spend Your Time in 2013 Paul Dilger – Director, Product Marketing, The TAS Group
Hinweis der Redaktion
- Thanks Will. I’d like to add my welcome to you all, thanks for joining us today. So if we’re to improve our sales velocity, we need to do some analysis around where we’re weak, where we can improve, and what we need to do to improve performance. I’d like to share our perspective on where the global B2B sales industry is right now, and our recommendations on what you can do now to impact 2013. Our vehicle for this is something called the Dealmaker Index.
- In terms of our agenda, we’re going to touch on what it is, who has responded to it so far, and then look at some global trends, before further slicing the data to see how the regions fare. Then we’ll return to the index to give you some more thoughts on how you can use this free resource.[Removal of regional findings for November 14th session.]
- The Dealmaker Index is in essence a survey of 92 questions we ask the respondent about themselves and their organization. Our Dealmaker Index engine then analyzes the responses and automatically generates a series of tailored reports. The thousands of answers to these 92 questions then formed the basis of our research.
- I talked in my first slide about velocity, and you might remember the picture of the zebra on the motorbike outrunning the lion. The Dealmaker Index for an individual or specific company is the measure of that company’s sales effectiveness, which always translates to revenue generated for a fixed or variable cost. Whether a company is in growth mode, or in cost reduction mode, this fact always remains constant. This is what the Dealmaker Index is designed to measure – and we do that using the Sales Velocity Equation. In the Sales Velocity Equation, the hash mark represents the number of sales opportunities that are won or lost in a given time period, the $ sign represents the average value of those deals, The % sign is your win rate, the ratio of deals won to the total number of deals, and L is sales cycle length, is the average length of time resources are being applied to a deal before that deal is won or lost. The level of revenue that is generated by any company in any sales period is directly proportional to the number of deals worked, to the value of each deal, to the percentage of those deals that are won, and inversely proportional to the length of the sales cycle. These are the only four factors that affect sales velocity, your sales effectiveness. To increase sales effectiveness, you must increase the factors above the line, and decrease the factor below the line. For example, if you are successful in increasing each of the number of deals, average deal size and win rate by 10%, and decreasing the length of the sales cycle by 10%, you get an increase in sales velocity of 48%.For more information on the Sales Velocity Equation, please see our White Paper: The Simple Formula for Sales Success.[Should use slides 8 to 12 incl. for December webinar too]
- So far, then, the respondent profile features nearly 750 fully completed Index surveys, which takes around 15 minutes to complete. As you would expect, most of the participant were in the B2B arena and the majority of respondents are in the sales business, either directly in a Business Unit, or a supporting Service unit.[Actually, 734 respondents in total]
- You can see here the demographics split, mostly male, and the largest group - 41% - are in the 41-50 age category. This for me validates that the data we have is from professionals in the prime of their career.Only a quarter or so of the respondents are users of TAS, so we are pleased that the Dealmaker Index goes beyond that group to give us a pretty representative sample of the global market.
- In regional terms, the lion’s share of the respondents came North America. The EMEA ratio was just under a third 31%, with the balance coming from APAC and South America.
- There is a need for sales effectiveness best practices in companies who sell sophisticated offerings in a prolonged sales cycle, because in these companies the salesperson adds a great deal of value and is instrumental to the sale. This need is reflected in the make-up of the companies who chose to participate in the study. Technology and high end manufacturing companies have a high propensity to invest in sales effectiveness, and this is borne out in the data, with the ‘High Tech’ sector accounting for 25% of the respondent base, followed by ‘Industrials’ at 18%. Professional services are also well represented at 15%.
- The respondents in the study also represent companies from a broad spectrum of revenue ranges. We’ve captured the views, then, of small business, mid-tier companies, and large enterprises.
- With such a diversified survey group, we can draw some general conclusions about the wellbeing of the sales industry in 2012. So what can we say about the state of the selling industry in global terms?[Removal of regional findings for November 14th session.]
- While the number of deals companies are working, and their average deal size tend to be specific to the individual company and not particularly instructive when averaged over all responses, we can derive a good deal of knowledge from quota attainment levels. At an individual level, 32% of respondents claimed to be over quota over the last 3 years, which points to 68% of the selling industry not hitting quota over the last 3 years. This is in line with other research in this area.
- At a sales team level, the results are similarly poor. About a third of companies had less than 50% of their sales team achieving quota, with a third of them seeing 50 to 75% hit quota, and the remaining third seeing more than 75% hitting quota. In the USA and UK, the two largest countries represented in the respondent base, 31% and 38% respectively experienced less than half of their sales teams reaching quota.
- Perhaps as a response to market conditions and the necessity to do more with less, selling organizations reported good win rates in 2012. Respondents were asked what percentage of qualified sales opportunities results in a sale, and so we must assume a degree of latitude in how sales organizations defined ‘qualified’. Nevertheless, 17% reported win rates of less than 25%, 37% won between 25 and 50%, and 46% were successful more than half the time.In the US and UK, 17% and 14% respectively were successful less than 25% of the time, 37% and 40% respectively won between 25 and 50% of their deals, and 46% and 47% respectively were successful with more than half their deals.
- With a predominantly B2B (and B2B2C) audience, sales cycle lengths were measured in months rather than weeks. Fewer than 5% of respondents had a typical sales cycle of less than one month. With 21% enjoying a sales cycle of between 1 and 3 months, and 15% working on sales cycles of in excess of 12 months, the bulk of our respondents 59% fell within the 4 to 12 month range. US and UK sales organizations also reported a similar distribution pattern across their sales cycle lengths.
- With forecasting accuracy hovering around the 50% mark from other pieces of research over the last few years, it’s easy to see how the phrase ‘flip a coin’ has gained favor over the effort and discipline required to forecast accurately. That said, business planning cannot be done well without consistently predictable revenues. In the Dealmaker Index survey, respondents were asked if they agreed or disagreed with the statement that they usually closed deals as originally forecasted. 59% agreed, and 41% disagreed. Since answers cannot be individually verified, and assuming a degree of answers are made wearing ‘rose-tinted spectacles’, these results are roughly in line with the 50-50 guesswork that the sales industry is experiencing. In the US the response was more positive, with a 63%-to-37% balance in favor of forecast accuracy. In the UK the forecasting picture was significantly more blurred, with only 47% experiencing reliable sales forecasting.
- Against a fairly tumultuous 12 months for the selling industry, an encouragingly large number of sales organizations (48%) reported sales force turnover of less than 10%. Somewhat alarmingly, 13% of sales organizations reported that they had lost more than 3 out of every in their sales force. The US once again led the way in terms of sales team stability, with over half of US respondents suffering less than 10% churn. In the UK, this was not so promising, with low turnover organizations being below the global average at 40%.
- So what have we learned? You’ll see over the next few slides that we have tried to correlate answers to questions with quota achievement and win rate. Quota achievement and win rate are two of several measures you could take, but they are fundamental guides to effective selling behaviors. Now, we all know that sales is the lifeblood of all businesses, and nothing really happens until somebody sells something. But despite its importance, sales has not always enjoyed a seat at the top table.. On screen you can see that people were asked to answer to what extent they agreed with the question: our sales organization contributes significantly to overall company strategy. Their responses were either agree, agree strongly, disagree, disagree strongly, or neutral, and these responses were tallied against whether they achieved less than 25% quota, between 25 and 50%, between 50 and 75%, or over 75%. These are the columns, and the axis along the bottom. You want to be seeing more blue and green the further to the right you go. To make it easier for you, I’ve converted each of the following slides into just green to see the agree and agree strongly responses.
- Firstly, we were pleased to see the extent to which sales contributes to overall company strategy, that’s all the blue and green you can see. The trend is that the more that companies are sales driven, the more they achieve their quota. However, as you can see from the white space above the green blocks, there’s still a significant proportion of companies who don’t look to sales for input to their strategic direction.
- You can’t say quite the same thing about sales and marketing being in alignment however. Here we asked people to respond to the statement, our sales and marketing organizations work well together. There’s much more disagreement here, in other words much less blue and green as you can see, which speaks to the gulf between the two organizations that many companies still experience.
- But, even at these lower levels of agreement, you can see that alignment really matters. 20% more companies are aligned at the 75%+ quota attainment level, than those at the under 25% quota attainment level. So quota attainment is much greater at those companies where the two departments are working well together. If you want your company to appear in the right column, you have to get your sales and marketing people working together.
- Next we correlated the alignment responses against win rate, and as you can see alignment between sales and marketing is also a predictor of win rate.
- There’s about a 15% delta between those that agree at the top quota achievement levels, and those that agree at the bottom levels.
- Next, we looked at how well the CRM system and the prevailing sales methodology were used. Respondents were asked to answer across percentage groups, less that 25% usage, 25-50%, 50-75%, and 75-100%. CRM systems have been muchmaligned by sales organizations over the years, and you can see the situation hasn’t changed, but methodology usage is worse. We at The TAS Group are trying to fix that, because as we have been arguing over the years, and as you’re about to see from the data, methodology use has a direct and positive bearing on performance.
- We will see later the benefit of doing it the right way, but for now here are some of the key reasons why users fail to adopt methodology.The main reason why sales people choose not to use the methodology is that only some people in the company use it. When we've been asked to look at failed methodology implementations, we’ve often seen situations where the sales person is asked to use the methodology, but sales management or sales leadership didn’t even attend the training on the methodology. If management is only focused on the reports from the CRM system rather than walking the walk of the methodology then the methodology will definitely die on the vine. This is a recipe for failure.On to the second reason: What was learned has been forgotten. Very few sales methodology implementations have sustainment and measurement as part of an on-going program to keep the methodology alive. We believe that the majority of learning comes from on-going application; not from event based training, or even training supported by online learning that can be accessed after the training event. True results are achieved only when the methodology is embedded into how sales people work their opportunities. The third reason that sales people cite for not using their methodology, is that it is not integrated with the CRM system. Methodology – to be most effective – should be delivered in context, at the point of the sale where the sales person needs it. Most of the time that data is in the CRM system, and the methodology mustuse the CRM’s data intelligently. Even though this is the third ranked point – it is actually the most important and, if addressed, will go a long way to resolve the first two. If the methodology is baked into the CRM system, then more people will use it, and what has been learned will not be forgotten.
- The extent to which people agreed that their prevailing sales methodology was integrated into their CRM system was an important indicator of quota attainment.
- While you can see the differences in percentages on screen, in terms of hard numbers, of all the companies who had integrated sales methodology into CRM, 4 times as many enjoyed 75% or more quota attainment as those with less than 25% quota attainment.
- Anecdotally we all feel that using methodology leads to sales success. We asked people what percentage of the sales team uses the methodology, and they responded less than 25%, 25-50%, 50-75% and 75-100%. These are the colored blocks. Then we arranged their answers according to their win rate, that’s them along the bottom, win rates of under 25%, 25-50%, 50-75% and 75-100%. So now we know statistically, as you can see, that using the sales methodology has a very large impact on win rate. Those that use the methodology more often are more likely to hit quota. You have to ask yourself if you want to be in the right column with all the blue and green, or in the left column with the low win rates, and to do that you need to have all your people using the methodology.
- An important part of sales methodology is being able to assess and qualify the opportunity accurately, especially when it comes to early qualification out of the wrong deals. Again, we asked people whether they agreed that their sales team was effective at qualifying opportunities, and correlated the responses against their quota achievement. Here you can see the importance on quota achievement of effective deal qualification.
- Look at the difference between the blue and green in columns 1 and 4. It’s about a 35-40% difference between the worst performers and the best performers. So if you’re going to do one thing, you could use methodology and qualification to dramatically impact your quota achievement.
- Then we took the responses on what percentage of the sales team uses the methodology and correlated them against the responses to the question of whether they agreed that their deals closed as forecasted – or in other words their forecast accuracy. And when salesmethodology is used, you see a much more accurate forecast.This is all about predictability. In the last few years, we’ve had severe financial and economic pressures, and huge disruption to the way business is done. People are saying over and over again that predictability and forecast accuracy is harder, and more important than ever. But look at column 5, and see the impact that methodology has on forecast accuracy. That’s a sure fire way to alter the trend that 50% of deals close as forecasted.
- Improving sales performance is not the exclusive domain of sales methodology. We can draw important parallels from application of sales process as well. Having a map to your destination, with your sales process mapped to your customers’ buying process, clearly helps you in getting to win more often. We asked Dealmaker Index respondents if their sales process was well defined, and correlated their answers on the spectrum of strongly agree to strongly disagree against their quota achievement. Following a well defined sales process, as you can see, has a direct and positive bearing on quota achievement.
- Improving sales performance is not the exclusive domain of sales methodology. We can draw important parallels from application of sales process as well. Having a map to your destination, with your sales process mapped to your customers’ buying process, clearly helps you in getting to win more often. We asked Dealmaker Index respondents if their sales process was well defined, and correlated their answers on the spectrum of strongly agree to strongly disagree against their quota achievement. Following a well defined sales process, as you can see, has a direct and positive bearing on quota achievement.
- Following a well-defined sales process also had a bearing on win rate, although the relative percentages of people agreeing that they followed a defined sales process were lower at the highest levels of quota attainment that the 50-75% quota attainment level.
- While numbers of voters at the 75-100% win rate level are much lower than the 50-75% win rate level, the inference here is that there are some very capable sales people who are following their own tried and trusted process in the absence of a organization-wide process. This is not a good long-term strategy for sales organizations. A well-defined sales process moves the entire performance bell curve in the right direction, benefitting the large body of core performers and by extension the organization.
- Forecasting does not warm to the charms of sales methodology alone. As one might expect, there is a very strong causal connection between sales process and forecast accuracy. I’ve just talked about the benefits of sales process to quota attainment and win rate, but its effect on forecast accuracy is even more pronounced. We asked people to respond how they felt about the statement that their sales process was well understood and executed by the sales team, and correlated these answers against whether their deals used closed as forecasted – their forecast accuracy.
- The relative percentages of people who understood and executed their sales process, while enjoying high forecast accuracy dwarfed those with poor forecast accuracy. Conversely, the overwhelming majority – 73% in fact – of people with poor forecast accuracy did not follow sales process.
- We also correlated responses between theory and practice.We all know that it should be easier to get more business from existing accounts; the typical statistic is a factor of 3 or 4 times easier. Many of the respondents – a full 82% – agree that competency in account management is important, but the execution or results seem to be lacking. It appears that in many cases there is a good opportunity for improvement.
- Here we are seeing conflict between the importance companies place on the criticality of sales forecasting to their overall business planning, and the importance of competency in that area.
- This is even more pronounced in the area of pipeline management – with only half of the respondents believing that the pipeline gives an accurate picture of future business, while competency requirement is viewed as very important or essential by 81%.
- By common consent the most important sales stage in the sales process is needs analysis, when we need to uncover accurately how the customer’s requirements map to their business challenges. Respondents were asked which sales stage they felt was the most important, and by a slim margin the most selected was Needs Analysis. It was encouraging to see the importance weighted heavily in favor of the earliest sales stages in an opportunity. Respondents were also asked which stage was the most difficult, to see if this revealed any inconsistencies between difficulty and importance, in effect between effort and reward. Importance outweighed difficulty in the early stages, whereas the opposite was true in the later stages. We infer from this that in the early stages people underestimate the difficulty of the earlier stages around assessing an opportunity, and this has important ramifications for win rate, which suffers from poor qualification and discovery skills. The disparity in the later stages reveals a skills deficit in negotiation and closing skills, and therefore an opportunity for improvement.
- Working from the assumption that Needs Analysis is the most important stage, we compared answers on which stage was the most difficult between those who voted Needs Analysis the most important, and those that did not. Those that voted Needs Analysis the most important also voted by quite some way that it was the most difficult. Those that decided a stage other than Needs Analysis was the most important struggled the most with closing. Although this was only marginally ahead of Qualification and Needs Analysis, it indicates that difficulties with closing may be due to inadequate problem definition and scoping of requirements in an opportunity.
- As with Sales Methodology integrated into CRM, the extent to which people felt their customer retention rate was satisfactory correlated directly with quota attainment. Of all the companies who agreed their customer retention rate was satisfactory, nearly 4 times as many enjoyed 75% or more quota attainment as those with less than 25% quota attainment.
- A range of questions in the Dealmaker Index survey asked about competition and competitive strategy. Differently worded questions checked for inconsistencies in individual responses, while also revealing any differences in perspective between the individual and the company. Sometimes we saw a discrepancy between how the respondent viewed themselves and how they viewed their company.
- An important part of qualification is doing the research on your prospects and prospect companies, and for some years now, social networks have been a great way of doing the research and making the connections. The B2B social network that provides most value to us correlates directly with the site that is most frequented. The delta may change over time, but at the time of writing LinkedIn is the clear winner when it comes to the preferred destination for business travelers in the Social Universe. LinkedIn has been a valuable source of traffic for us all. We measured ‘active’ as visiting the social network multiple times per week or more, and in the Dealmaker Index study, at 48% for all industries LinkedIn is comfortably ahead of Twitter and Facebook. For the Professional Services and High Technology industries, this active score climbed as high as 70% and 65% respectively. In the case of Facebook, the Active percentage was measured at 34%, peaking at 43% active for Professional Services and 38% for High Technology. By comparison, the Active percentage on Twitter was just 19%, with the 2 most active industries again being Professional Services at 31% and High Technology at 30%.
- LinkedIn is the most established business networking platform, and not surprisingly had the highest activity of the social media platforms measured. Professional Services lead the way in LinkedIn activity, with 70% activity and 30% inactivity according to our definition of active. High Technology is also a regular user of LinkedIn, at 65% activity and 35% inactivity. Telecommunications and Healthcare, 2 more industries with high propensity towards the use of technology, also recorded activity levels in the mid-40’s per cent.
- 2012 was the year that social media came of age in the business-to-business environment. With such explosive growth during the course of the last 12 months, it is sometimes difficult to aggregate opinion over the time span into something meaningful for 2013. Just to give you an example of this, Google+ did not exist when we launched the Dealmaker Index, and therefore does not feature in this study. We can, however, draw some important conclusions about Facebook and Twitter.With many companies across the world establishing a Facebook presence in 2011 and 2012, Facebook is fast closing the gap on LinkedIn. Professional Services companies are 43% active and 57%% inactive on Facebook. High Technology is 38% active and 62% inactive. also a regular user of LinkedIn, at 65% activity and 35% inactivity. Telecommunications and Energy & Power saw activity levels in the early-to-mid-30’s per cent, considerably higher than Healthcare, the nature of whose work is perhaps not as suited to the more open Facebook medium.
- As the youngest of the 3 social media platforms we asked about, Twitter saw the fastest growth in the B2B arena. As with LinkedIn and Facebook, activity varies by industry. It is not a shock to see Professional Services as the most active on Twitter (31% active, 69% inactive) as many are themselves promoting Social Media. It is not a surprise to see High Technology (30% active, 70% inactive) high on the list either. There is then quite a gap in activity by industry, with Healthcare at 21% and Telecommunications at 14%.
- The Dealmaker Index has highlighted a number of ‘good’ individual and corporate behaviors that positively impact quota attainment, win rate, and forecast accuracy. We also looked at what happens when you put all the good behaviors together, to discern the difference between the very best and rest. Here we have set the bar very high. To be classified as a ‘superstar’, you need to have a number of good behaviors in place. These are: to have methodology usage at greater than 50%, to have CRM usage at great than 50%, to have a sales process properly defined, and to have a sales methodology properly integrated into your CRM system. We compared the quota attainment of superstars exhibiting all 4 behaviors against the others who exhibited 0, 1, 2 or 3 of the good behaviors. The benefit is obvious; superstars make more quota. Superstars outweigh the others at the higher levels of quota attainment.
- We also compared the win rate of superstars against others. As with quota attainment, at the higher levels of win rate, superstars outweigh the others by some margin.
- If we concentrate at quota achievement and win rate levels of more than 50%, it is a very sizable delta between the best and the rest. 81% over 45% is a 78% delta for quota attainment greater than 50%. For win rate greater than 50%, 70% over 34% give us a 108% delta.
- To complete our global analysis, we looked at this delta from the point of view of the non-superstars. For the rest the story is a delta of disappointment. In this case, rather than looking at how best practices combine to affect performance, we looked at how they each aggregate the impact on performance. In this case we selected the following best practices: to have CRM system usage at better than 75%, to have sales methodology usage at better than 75%, to have a sales process well defined, and to have a sales methodology well integrated into the CRM system. In this kind of analysis, it is always better to look at the middle of the bell curve to understand the trends. Here we are focusing on the difference between those companies where 25-50% of the sales team are achieving quota (the orange line sloping downwards to the right), and those companies where 50-75% of the sales team are making quota (the green line sloping upwards to the right). Most companies fall in to these two categories, and they are the boundaries of the ‘Delta of Disappointment’. The Delta of Disappointment represents the difference between the sales team’s potential and the actual results. Typically this means that you have the right caliber of professionals on the team, but they are being hamstrung by lack of process, methodology, and tools. Remember that across most research the average percentage of sales reps making quota is around the 50% mark. Being on the right side of average is the difference between just being able to survive, and having the results and consequent resources to thrive.
- You’ve seen the output of the Dealmaker Index at a macro level, how can you and your company use it?[Removal of regional findings for November 14th session]
- We often get asked whywe’re giving away all of this value for free. Well, we believe - and our partners in this initiative agree - that there is an opportunity for sales effectiveness solution providers to raise their game, and one of the ways to do this is to give value first and expect nothing in return. Then if the recipient of that value sees some worth in what they receive, then they will be in an informed position to engage – or not with the provider. It all stems from a fundamental belief that we should all stop for a minute and consider that the impact on a customer of a bad buying decisionis typically greater than the impact on a sales person of a lost sale. So if the data in the report can help anyone’s customers avoid a bad purchase, that’s a good thing.
- Here is the starting page of Dealmaker Index, accessed via www.dealmakerindex.com.To begin your sales teams can just register, and you can always come back later to review or change your results, or to study the advice that Dealmaker Index provides.At the bottom of the page, you can see our partners in the Dealmker Index project, and we’re very grateful to them for their support.
- What’s in it for me I hear you say. Well, when you’ve completed the questions, you’re provided with a Dealmaker Index score for yourself and your organization, those are the percentages in the blue. Your score is an absolute index for you or your organization, corresponding to 1 of 5 categories, poor to superstar for the organization, and novice to ace for the individual, just below the curly arrows. At the same time, your absolute index score is converted into a percentile to place you relative to your organizational or individual peer group, those are the grey percentage numbers half way down the screen.
- But that’s not all. In addition to the score, you also get advice in 3 different reports, a company summary, detailed analysis and advice for the company, and a personal Dealmaker Index advice report. Combined, these run to about 7000 words, so it is pretty in-depth.
- So how many ways can you the Dealmaker Index?First, your reps can get their own score and advice, and so can you.Second, you can use the Dealmaker Index as a benchmarking tool for within your sales organization. Third, you can get recommendations for your organization as a whole.Fourth, you can survey the different individual perspectives of your reps and managers on how your organization is performing. This can be particularly illuminating.Lastly, you could use the Dealmaker Index as a benchmarking exercise as part of your recruitment process.
- I’ve given you just some of the conclusions from the study today. We’re in the final stages of production for the Dealmaker Index study for 2012, and as promised, we’ll be sending a copy to all attendees when the report is ready.