When you invest in sales performance management (SPM), your expectation is that it’ll predictably deliver a quantifiable return. But companies require more than a technology strategy. They need to look at SPM more holistically in order to enable a suite of capabilities that produces true value.
This blog offers a new way to structure your SPM strategy to maximize business outcomes—and ensure your selected solution, implementation, and adoption drive more value than a glorified calculator. Read all the way to the end for a special offer.
Step 1: Assemble Your Revenue Operations Team
Revenue leaders face unprecedented complexity. Today’s virtual sales cycles are increasingly digital, with four of five B2B sales interactions occurring online, according to Gartner. And as business models increasingly emphasize recurring revenue, touchpoints with customers—not prospects—are increasingly important for revenue. For example, Winning By Design found that organizations can increase revenue from existing accounts by over 40 percent with more frequent upsell activity.
These trends are fueling a dramatic shift in focus, from sales to revenue—and by extension, Revenue Operations.
Who is on the Rev Ops team? The more people, the more profitable, as it turns out. According to Aberdeen and SiriusDecisions, companies can triple their revenue each year when their marketing, sales, and customer success teams operate in tandem. We also see product and finance teams participate in Rev Ops to companies’ benefit.
Take this 10-question survey for a custom assessment of your Rev Ops’ Maturity, and receive personalized recommendations for your SPM strategy.
Step 2: Craft An SPM Strategy to Power Revenue Operations
Revenue executives know they need to be experts in Revenue Operations, so they treat SPM as the glue for Rev Ops.
Having a holistic SPM strategy separates the winners from those that don’t produce value from their investment. Three prongs come into play.
- Orchestrate. This SPM prong puts your revenue ducks in a row. Supporting best practices include the coordination of all specialized roles and technology in the entire revenue organization—as well as continuous planning that gets all revenue leaders in one room.
To learn more about Orchestration, register for our webinar, “Sales Planning Rules to Break” on April 8 @ 4PM ET / 1 PM PT.
- Motivate. This pillar taps into your entire revenue team’s desire to win by making expectations clear.
- Incent. This prong of your SPM strategy pays for performance—and correlates Ochestrate’s planning activity with the roles & responsibilities communicated in Motivation.
A complete SPM strategy will leverage all three prongs. However, these three SPM pillars aren’t necessarily sequential. In fact, many organizations begin their SPM journey with the second or third pillar, such as with an Incentive Compensation Management (ICM) solution. Increasingly, innovative enterprises start with Orchestrate, often with an intelligent forecasting capability that empowers them to be among the 97% of organizations that meet quota because they forecast with a best-in-class approach, according to The Aberdeen Group.
Step 3: Craft Your SPM Technology Roadmap To Deliver Revenue Efficiency.
A complete SPM strategy requires supporting technologies for each pillar of your strategy. The following graphic conveys how different SPM capabilities ladder up to each strategic SPM pillar.
- Orchestrate. Core capabilities include intelligent forecasting, territory and quota management, capacity and sales planning, and sales budgeting.
- Motivate. This SPM pillar involves functionality, like field transparency and SPIFFs, gamification, leaderboards, and predictive insights that alert you when and why high performers are at risk of attrition.
To learn how to motivate your entire revenue organization, watch our recorded webinar, “Rethinking the Rep Factor in 2021.”
- Incent. Core tech competencies include individual estimators, accruals and commission expense accounting, compensation modeling and benchmarking, dispute management, crediting, and communication about statements, plan distributions and other changes.
As with your SPM strategy, your SPM technology roadmap will not necessarily happen in the sequence outlined above. However, it’s likely to involve all mentioned capabilities at some point.
Step 4: Introduce New Functionality To All Revenue Teams Concurrently.
Many organizations mistakenly begin their SPM implementation with a pilot for one team, generally sales. They introduce new products to that single team over time and only add additional teams after that. This approach squanders important revenue efficiency insights and creates infinitely more work.
By phasing in new SPM capabilities and functionality to all revenue teams, you streamline your implementation and capture important revenue insights early on. These insights are key to harnessing the business outcomes that you seek. With this approach, one leading IT services provider halted $2M in overpayments and decreased disputes by 50 percent. They also reduced their overall cost of cash.
Five Other Tips For SPM Success
Today, revenue leaders understand that implementation and adoption—not technology—are their true bridges to value.
- Good is better than great. Plans will change before they go live, so the sooner you automate, the faster you can shift to match opportunities.
- Avoid bulk pricing. While most implementation providers offer “t-shirt pricing” that sets a price range, be wary of organizations that contract against it. Getting value requires deep knowledge of many variables unique to you.
- Plan for partnership. SPM requires expertise, and expertise requires experts. When selecting an implementation and managed services partner, plan to work together for several years.
- Use SPM as more than a calculator. Why you invested in SPM software in the first place is the reason you need recurring services scope. Ask over and over, “what are we still doing outside the system?”
- Repurpose talent. After SPM implementation is complete, and adoption is increasing, compensation teams are most valuable in sales reporting, sales operations, revenue operations, or finance.
Above all, don’t withhold information. Your total cost of ownership—the real measure of ROI—hinges on automation of your core 80%.
Special Offer: Craft Your Blueprint for SPM Readiness
Scoping sessions are highly necessary to eliminate the exceptions you make each month, to sidestep all the ways that your plans could be gamed, and to craft a personalized proposal.
Email firstname.lastname@example.org to learn more about getting a discount on our Incentive Compensation Assessment and SPM Readiness Roadmap.