CSO Insights 2011 Sales Management Benchmark Report Surveys Selected: Widget Industry (Sample)

These charts represent answers to our 2011 Sales Management survey from sales executives in the Widget Industry. From their answers, youll get a good idea what other executives are experiencing in todays business environment. As you review the charts, keep in mind what you would have answered to the questions so that you can best interpret our comments. We recommend you use this report alongside our 2011 Sales Management Optimization research report, as best practices and case studies included in the report will help you devise an action plan. We have provided comment on the charts for 10 metrics that we find have the most impact on sales results. The rest of the charts, representing answers to all the questions in our survey, are included without comment.

The data used for this benchmark comes from surveys completed by sales executives between January and April 2011.

The information in this report is for internal use only. Feel free to share the report with colleagues within your company.
For any other use of this report, please contact CSO Insights. You may receive a PowerPoint version of this report so that you can use the slides in presentations to your management team. Email Laura Andrus and request your PowerPoint file. Laura.andrus@csoinsights.com

Win, Loss, No Decision Rates

A sales managers main role is to help salespeople more effectively move opportunities through the pipeline. One of the key metrics we have used to assess how well managers are doing their job is to look at the close rate of forecast deals. Win rates are low across the board in 2011. The Widget Industry has a higher win rate than reported in our 2011 Sales Management research report, which is good. The 27% no decision rate is 3% higher than the combined results, and represents a lot of wasted cycles in the sales force. Best Practice in this area is improved coaching by sales managers. This metric is covered in the 2011 Sales Management Optimization report on pages 34.

Profile of First Line Managers

Participants in our 2011 Sales Management study made it clear that industry experience is paramount for new managers. As a result, most companies hire new managers from their industry or they promote sales reps from within their companies. The Widget Industry is more interested in promoting existing sales reps than in bringing in managers from outside the company. 80% of these companies look to existing sales reps to fill management jobs, versus 64% of all the companies in our survey. Although sales results do not differ much between these choices, our data show that turnover rates increase when sales reps are promoted to managers. Best practices for this metric include watching turnover rates when promoting sales reps and in developing programs to ensure sales reps are ready to take the reins before putting them into these important jobs. This metric is discussed in the 2011 Sales Management Optimization report on pages 5-6.

Sales Management Training Assessment

We look at this metric to see how committed companies are to making their managers successful. In 2011, we saw an overall drop in the effectiveness ratings of all types of manager training except CRM and forecast/pipeline management skills. Coaching and mentoring took the biggest hit. This is not good in a year when 70% of companies in our Sales Performance study said they were increasing their sales force. New hires put even more demands on managers to perform, and the investment in their training should reflect this. The results for the Widge Industry are much worse than the overall Sales Management survey population for coaching and forecasting. 60% of the Widget Industry companies say coaching/mentoring training needs improvement compared to 49% of the overall survey population. The numbers for forecast management are Widget Industry 57% needs improvement, overall survey, 40% needs improvement. Best practices include considering investing more in manager training than in rep training and the critical need for coaching & mentoring training to be at the top of the list. This metric is covered in the Sales Management Optimization report on pages 7-8.

Sales Manager Time Allocation

We look at this metric because of the importance of sales managers spending time with the sales reps. If we see excessive time spent on other tasks, we can usually predict trouble. Manager time coaching sales reps and selling with sales reps was similar this year to last. What did change was the ratio of reps to managers, which means each rep got a little less time with the sales manager.

Managers in the Widget Industry companies spent 5% less time with their reps than the average manager in the survey. The 5% went to internal meetings and management tasks.
Best practices for this metric include adoption of CRM 2.0 tools to extend the managers reach. This metric is covered in the 2011 Sales Management Optimization report on pages 910.

Metrics Used to Assess Sales Manager Performance

We watch this metric because we know that companies get what they pay for. If the primary compensation metric is making the sales team number, you may make the overall number. If you make the number because the sales managers went out selling their own deals or rode over the finish line on the backs of the superstar sales reps, what does that mean for next year? For turnover rates? Since this is a real possibility, more companies are compensating sales managers for helping each and every sales rep make the number. 49% of the companies in the overall study are compensating sales managers this way. The Widget Industry companies are right in line with the others in the survey. Best practices for this metric include increasing use of forecast accuracy as a measurement of sales manager performance and better technology to calculate commissions. This metric is discussed in the 2011 Sales Management Optimization report on pages 11-12.

Ability Assessment: Sales Intelligence & Knowledge Access

We watch this metric because sales intelligence and sales knowledge management make great virtual sales coaches when the sales manager isnt available. The technologies for these applications are stable, affordable and invaluable to the companies that use them. The Widget Industry companies are ahead of the pack in sales intelligence, and lagging behind more than 10% in sharing best practices and access to competitive analysis. Theyre also behind 5% in access to client marketplace information. Our Sales Performance Optimization study supports this. Sales reps in the larger companies have the most difficulty getting sales knowledge when they need it. Best practices include an on-demand sales information repository at Experian. This metric is covered in the 2011 Sales Management Optimization report on pages 13-14.

Level of Sales Process

Combined with the level of client relationship, this metric has the largest impact on sales effectiveness, according to our results. The more formal the sales process, the easier it is to train reps, measure their performance, forecast outcomes and win more. 43.5% of the participants in our study have a formal or dynamic sales process, which leaves 56.5% who dont.

39.8% of the Widget Industry companies have a formal or dynamic sales process. That means 60.2% have a random or informal sales process.
Best practices for this metric include a 20% increase in the % of reps who make quota with a dynamic sales process versus a random process. This metric is discussed in the 2011 Sales Management Optimization report on pages 15-16.

Sales Management Best Practices Execution Assessment

These are metrics we like because you can make a prioritized to-do list at one glance. We selected these items because they are generally agreed-upon activities we rely upon sales managers to handle. Our survey population in 2011 fell particularly short in getting reps to develop strategic account plans and identify all the stakeholders in a sale. They do fairly well at getting reps call on executives, link the solutions to stakeholder needs and assess opportunities before committing resources. The Widget Industry companies had even greater issues with account plans and many of the others. They remain in the one-digit percentages on exceeds expectations for all the metrics. Everyone walks away from this list with an action item. Best practices for this metric include finding a Sales Intelligence provider. This metric is covered in the 2011 Sales Management Optimization report on pages 17-18.

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Ability Assessment: Forecast Management

This list of metrics defines 6 forecast-related activities for sales managers. Successful execution of these activities will give sales managers a good handle on the forecast. We first asked the survey takers how important these items were to making their numbers. Finding reps who need coaching, finding the forecast deals that are slipping and effectively coaching sales reps were rated ultra-high in importance. The ability to execute these tasks was not so high among the survey takers. The Widget Industry companies have the same issues, to a larger degree. While the needs improvement stats were in the 30%-40% in our overall survey, 40%-50% of the Widget Industry had issues with several of these critical activities. Best Practices for this metric include sales analytics and Coaching By Exception. These metrics are discussed in the 2011 Sales Management Optimization report on pages 19-10.

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Sales Management Effectiveness Priorities Going Forward

This metric gives us an idea what the CSO thinks the problem is, as they are planned initiatives for this year. #1 this year and last year is improving the ability to show benefit and value. #2 is competitive differentiation. These really go together. The Widget Industry agreed on #1, but went another way on #2 Optimize Sales Process. And #3 was Increase Customer Loyalty. Improving sales process will be part of showing value. As for customer loyalty, perhaps this group has spent so much time chasing new accounts that they realize theyre not getting as much out of the base as they should. Best practices for these metrics fall all over the map. But rest assured they all involve improving the sales process and making your relationship with the customer more strategic. This metric is covered in the 2011 Sales Management Optimization report on pages 21-22.

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