Guide
Nov 03, 2020
Xactly User Conference May 20-22, San Francisco
Sales strategy and planning is a difficult process, especially when you lack the data visibility and tools to manage it effectively. Learn how automating operations with Sales Performance Management (SPM) helps organizations take control of their data and overcome top planning and management challenges.
Sales planning is a complex process, and without the right tools, it can be a time-consuming nightmare. To make matters worse, when your company expands or outside circumstances shift, you have to go through that grueling process all over again to make changes or scale plans.
Fortunately, managing your revenue-driving strategy doesn’t have to be that strenuous. Automation tools like Xactly Sales Performance Management (SPM) help centralize data, streamline processes, and increase data visibility. This frees up valuable resources to focus on strategic sales planning rather than baseline administrative tasks.
Here are five common sales planning challenges and how automation with SPM gives you an action plan to improve sales performance.
CHALLENGE: We can’t make decisions in a timely manner.
SOLUTION: Bring in stakeholders from across the organization early.
Start your sales planning process with a team of strategic key players in mind. When you have too few or too many people on your team, decision-making slows down, and miscommunication can lead to additional delays and setbacks.
Ideally, you want one member from each of the following departments: sales leadership, finance, human resources, and an outside expert from consulting or strategic services. Each member will bring their team’s priorities to the planning table, which will help ensure that everyone’s objectives are kept in focus while supporting the overarching company goals.
HOW SPM HELPS: Use data to guide decision making.
It’s easy to recycle sales plans year after year, especially if they cover your high-level goals. But as your company grows and targets change, you’ll need to understand both how you’ve performed in the past and how you expect to perform in the future.
SPM helps you analyze your data more clearly and identify trends that may impact future performance. As you build out plans, you can use your SPM software to model different performance scenarios in order to design more accurate quotas, territories, and incentives.
CHALLENGE: A large number of incentive components makes the plan complex.
SOLUTION: Follow the ABCs of sales compensation planning to keep plans simple.
Ideally, your sales incentive strategy should consider all executive and departmental objectives, but it should remain simple enough to execute, understand, and communicate effectively.
Xactly Insights data shows that plans with three to five components are an ideal target. Any more and you may have conflicting incentives that make it difficult for reps to decipher what deals and selling behaviors to prioritize. Any fewer and you may not be driving your highest levels of performance.
The ABCs of sales compensation planning enforce plan simplicity by ensuring incentives are:
- A: Aligned to Different Sales Roles
- B: Benchmarked Against Industry Data
- C: Constructed to Drive the Right Sales Behaviors
HOW SPM HELPS: Analyze incentive performance continuously.
One of the biggest benefits of automation is the ability to view performance in real time. This allows you to see progress towards goals, team performance, and individual quota attainment at any given moment. When you dive deeper, you can examine the effectiveness of your sales incentives, make changes more quickly, and continuously stay on track to hit targets.
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CHALLENGE: It’s difficult to ensure everyone understands the plan.
SOLUTION: Take Measures to Communicate the Plan Effectively.
One of the most crucial steps in sales strategy and planning is successfully communicating your plan so that each member of the sales team understands it fully. Typically, this can be challenging for a few reasons, including:
- Sales reps may believe that changes to the compensation plan will result in a loss for them
- Employees are sometimes naturally wary of decisions that management considers “for the best” of the company
- Leaders and management may lack the ability to clearly communicate the plan changes
Luckily, you can avoid plan rejection and confusion by communicating clearly and effectively. Here are a few tips to help you roll out new plans:
- Assemble a strong communication team: Start your plan communication with top leaders and executives and work your way through each management level.
- Be transparent: Explain the differences between the new and old plans, make changes clear, and put emphasis on how this benefits each sales role.
- Check in with managers and sales reps: Take time to sync with the sales organization and provide opportunities for questions to ensure everyone understands the benefits of the plan, the overarching sales objectives, and how the plan functions.
HOW SPM HELPS: Reps can see earned commission in real time.
Sales Performance Management software enables leaders to document plans in one central place. Because incentives are automatically calculated, reps can see their sales plans in action and view earned commissions in real time. In that same light, managers can dive into individual rep performance, address any potential issues, and provide additional coaching where necessary.
CHALLENGE: We struggle to report and consolidate our sales performance data.
SOLUTION: Use Specific Metrics to Ensure Plan and Sales Effectiveness.
Once you implement a new sales plan, you should continuously monitor sales performance and analyze your plan’s effectiveness. Like your plan design, aim for simplicity and metrics that measure the effectiveness of your plan.
As you begin to understand the initial workings and results of your plan, you can dive deeper into data, but to start, focus on these need-to-know metrics:
- Percent of sales reps meeting (and exceeding) quota
- Lead response time
- Sales win rate
- Time spent training and coaching sales reps
- Sales rep satisfaction
HOW SPM HELPS: Create a single source of truth for the entire organization.
It’s extremely challenging to ensure data accuracy when you’re operating in a variety of spreadsheets and disconnected tools. That also makes it nearly impossible to align the leadership team when everyone is getting information from different sources.
At the very core, SPM helps centralize your data. When all of your data sources, including CRM, incentives, etc., are in one place, everyone is accessing the same information. This not only helps align teams but also makes it easier to analyze performance, simplifies decision making, and provides a holistic view of your revenue-driving strategies.
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CHALLENGE: When a top rep leaves, we’re blindsided.
SOLUTION: Plan ahead with more precise capacity planning and performance analysis.
When you lose a top performer, it’s challenging to stay on track to hit revenue targets. More precise sales capacity planning is a great place to start to ensure you’re hiring the right amount of people at the right time. It also helps you ensure that should a rep leave, there is someone fully or nearly ramped to pick up where they left off. But ideally, you want to be able to avoid them leaving in the first place.
HOW SPM HELPS: Identify and flag reps at risk for attrition.
SPM tools like Xactly Insights use machine learning to provide a deeper understanding of your sales team. By examining trends in performance, Xactly Insights can identify patterns in rep behaviors that signal they may be at risk for turnover. This triggers an alert for sales leaders, allowing them to take action to prevent attrition sooner.
From Sales Planning Struggle to Success
In order to drive revenue, today’s businesses need to make decisions quickly and strategically. But a data-driven approach isn’t possible when operating with manual processes and spreadsheets.
Sales Performance Management helps automate processes, but it also helps continuously improve sales strategy and planning, which is critical to hit increasing goals and drive growth in any situation.
In fact, using SPM, one of the world’s largest manufacturing suppliers, Flowserve, was able to analyze, pivot, and accelerate growth in response to the 2020 pandemic and largest disruption in the manufacturing industry’s history. Learn more about their story, and see how you can get started transforming your organization today.
