Projects and Case Studies

Managing Sales performance – Looking beyond the numbers with Sales Competency Modeling

A Networking products company was concerned with the performance distribution curve of their Sales Organization,especially with the majority of sales people under quota. When reviewing their quota attainment stack rankings, they were disconcerted over the fact that greater than 70% of the sales team were below 100% and were also surprised over the names of some of the individuals who were either below or above the number. The annual review process instituted by the company, and complied with by all organizations within the company, provided little information aside from an overall ranking (which, for sales, was generally tied to quota performance).

The Sales organization felt the process was important but was excessively time consuming, there were no linkages to quantifiable actions, and, it was most often times confrontational. Hence, it was viewed as a “check the box/completed” type exercise.

The company was looking for a solution which enabled the Sales Organization to identify their top performers, aside from quota attainment, and distinguish the set of specific competencies and skills inherent to that group. Executives felt that by using an internal benchmarking technique and identifying key skills and competencies from their top performers, they could take the actions necessary to improve the performance of the underperforming 70%, therebygaining top line revenue at a minimal cost.

The initiative involved four key phases with associated deliverables including: Assessment, Design, Alignment, and Implementation.

The Assessment Phaseconsisted of two steps – the first was a review of stack rankings, revenue attainment, and available performance review data. Approximately, 40% of the revenue was coming from 70% of the resources (those under quota) while 60% of the revenue was coming from 30% of the resources (which were at or over quota). The second step was a review of the tools and/or programs for assessing key competencies that drive performance which were found to be inconsistent, hence - no clear definition as to how to differentiate performance, aside from quota attainment. In concluding the assessment, training activities solely centered on product and compliance, and, hiring was based on relationships, “gut feel” and “best available”. The analysis also revealed that a 2% improvement in the underperforming group would result in a 1.1% increase in total company revenues.

The next phases, Design and Alignment, involved the development of both quantitative as well as qualitative competency categories as well as a relative value weighting for each competency. The use of relative weighting allowed for differentiation based on attainment and skills (low attaining Rep in a rebuild territory or high attaining rep in an inherited, revenue generating account). A simple and easy to implement tool was customized for Managers to “rate” each of their sales reps and preliminary results were rolled-up.

The group analyzed the data and noted numerous competencies where consistently, individuals in the over performing groups ranked high, while conversely, Individuals in the underperforming group ranked low. Upon further review of the data, the team also noted low scores for both groups and equated those results to potential process issues which would be designed into the solution. Analysis concluded a direct correlation between over performance in sales results and key competencies. The graph to the right highlights, for example, the correlation between Sales results and Sales Activities/Sales Skills.

Yet another analysis illustrated the correlation between Sales Results and Prospecting Activities – Calls/day, Emails/day, Conversion rates, demo’s/day.

A third analysis demonstrated the relevance of Knowledge – Knowledge of the Industry, the competition, Product Knowledge and General Business Knowledge Knowledge to over performance of sales quotas.

Through the use of these dashboards, management quickly identified focus areas to address in the Implementation Phase.

Internal resources as well as outside vendors were identified which had solutions for identified weaknesses.

Using workforce analytics, they noted, allowed for identification of areas where investments would be made with positive measurable results and sustainable.

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The initial Implementation focused on addressing several of the key deficiencies within the underperforming group, utilizing both the internal as well as external resources. Internally, groups were aligned with solving process issues, i.e., on-boarding and product/competitive knowledge. A new on-boarding process was initiated and supported all global hires. Marketing performed extensive training in the areas of product and competitive positioning. Company Executives participated by addressing overall Business Issues relevant to their respective groups.

Externally, focus was placed on the Account Planning process, for both the underperforming as well as the over performing groups A Vendor was selected and training for both the high-touch sales teams as well as the Channel organization was rolled out in conjunction with company’s WW Sales Kick-Off meeting.

As a note, the company experienced an 8% year over year gain in top line revenue within 6 months following the focus on Employee performance Analytics and a 17.5% gain the year after.