Sales Operations Metrics: Focus on Outcomes and Measure Success
The average sales person spends 1 out of every 3 of their working hours on selling, and they spend twice as much time on back-end processes.
There are plenty of amazing guides to sales metrics but not nearly enough that consider what sales operations should measure, and why.
Don’t misunderstand; sales metrics are critically important. But when sales operations excellence is capable of boosting top-line revenues by 10-20% while reducing SG&A by 20-30%, sales ops is an area that clearly deserves our attention.
So how do sales operations professionals measure their proficiency, and their growth opportunity? We’ll answer that question with just a few minutes of your time.
The Optimal Sales Organization Divides Labor into Front-End and Back-End Processes
Before we get into specific metrics, let’s start by understanding what the ideal sales organization looks like.
The key role of sales ops is to improve sales processes that directly support sales reps. A lot of people say sales ops is the back-end support of sales processes. Both of these definitions are true.
So, an ideal sales operations function will handle all back-end support functions, leaving sales reps, or account executives if you prefer, with nothing to do but grow customer relationships.
B2Bs can often confuse these two roles and expect sales reps to perform back-end functions. But why?
If you were a football team, you would not want a defensive tackle also playing as running back sometimes. Or vice versa. The fact is, the optimal organization allows everyone to focus on one job, so that they become incredibly efficient at that job.
And correct me if I am wrong, but salespeople are not exactly made to fill out paperwork. But selling is in their DNA. So, the true goal of the sales ops team is to eliminate as many non-sales processes as possible from their responsibilities.
Measuring and tracking the right metrics will help to identify opportunities to optimize performance and forecast the real impact these changes will make in terms of your top- and bottom-line.
Sales Operations Metrics: A Process for Understanding How Much Value You Can Add
The primary goal of sales operations is to give sales reps more time selling. Therefore, some of the most important metrics are time-based activities.
How long does it take your reps to configure a quote? How long does it take to write a proposal? How long does it take to process an order? How long does the rep spend on the phone or in the field, cultivating customer relationships?
- The first thing you need to do is write down the sales process from the sales side. Find out every little thing about what sales reps are required to do in their day-to-day, as well as how long it takes them to finish.
- Next, list the back-office activities versus front-end activities and figure out what percentage of time is spent actually selling.
The average is approximately 1/3. Literally, the average sales person spends 1 out of every 3 of their working hours on selling, and they spend twice as much time on back-end processes (Accenture, 2015 CSO Insights Sales Performance Optimization Study).
That is a whole lot of opportunity for sales operations and the main reason why sales operations excellence can pay enormous dividends on the top and bottom lines.
In this article, we established a way for sales operations to identify, measure, and track opportunities to improve its value. What we have not talked about is how to create better systems, or how to make improvements sustainable over the long haul.
What makes sales operations excellence so difficult to master is the fact that organizations are always growing and changing, now more than ever. So there needs to be an iterative process, designed to constantly track sales activities and then delegate/automate as many non-customer-facing activities as possible.