KPIs in Sales - Examples and tips for key figures in your sales department

Key Performance Indicators (KPIs) are a must in today's sales world. Without key performance indicators, sales managers and employees would be working aimlessly. These metrics are used to define goals, and each sales manager has clues as to what he or she needs to achieve. If you make between 50 and 100 calls every day, it's easy to lose track and your work loses effectiveness.

Today, key figures are standard in almost all areas of a company. Sales managers give figures that the team is supposed to reach and orient themselves on the statistics they get back about the employees. Many sales professionals do not yet see the great advantages of such key figures. It is not a question of controlling sales staff, but of recording and analysing customer acquisition, sales and customer care. In short, it's about transparency. In order to work effectively and make improvements if necessary, a sales manager must know how the daily work works. How many calls does a sales manager make to make an online demo or appointment? How many demos or appointments are needed to generate a deal? All these numbers are in the daily work and should be made visible. It is not uncommon for too much time to be spent on smaller customers where it is clear from the outset that sales are low.

KPIs in sales - it is important to pay attention to them

It is important that key performance indicators say something. It is not about creating statistics so that the trainee can practice with Excel. The indicators should be relevant to the work and serve a purpose. By the meaningfulness of individual numbers, in the best case different processes can be set in motion.

Imagine, in the soccer Bundesliga no goals are counted or there would be no statistics. The competitive character would not be given and the sport would not inspire masses. Only the rules, regulations and statistics make the game interesting, highlight special achievements and define the claim. The same applies to distribution. The key figures are the driving force and the rules of the game. They turn sales into a competition and also serve for analysis.

The key figures determined serve for continuous improvement, control and assessment. If a number changes, this should inevitably result in processes that are at best set in motion automatically. If an employee has not managed his quota of telephone calls with interested parties in the last month, he will automatically catch up in the next month. However, this may mean that he can no longer meet his other goals. The figures must therefore be precisely defined. It must be clear to every employee what the figure says and what consequences it will have if it changes.

Time also plays a role in these changes. The challenge must be to bring about change in real time. It is of no use to a sales team if customer wishes or deadlines change, but only a few months later are they reacted to. As a result, the goal loses importance and the opportunity for effective change is lost.

"What's the right KPI for me?"

Asking this question in a general round makes as little sense as asking the question about the most beautiful goal in football. There is no right answer. Different facts count for every company and the working environment is never identical. So how can it be the KPIs?

The KPIs result from the goals that each sales team has to set for itself. If you work in the field, an important value is the number of customers you visit every day. If you create a larger quantity here, this is positive and an important key figure for you. On the other hand, employees in telephone acquisition pay attention to the calls made and how many telephone calls they have made to the actual decision-makers.

First think about what your daily business is and which figures play a role for your success or failure. This is a first hint and helps to find out the key figures.

A scenario:

Imagine you are a sales manager in a company that manufactures and supplies car parts. You have a team of 20 employees behind you, some of whom work in the field and some in the office. Every day you calculate figures for each of your employees about their work. How many calls were made. How many new customers were won. You can find out the number of prospective customers and a lot more. At the end of the quarter you have to present your boss with the most important figures and explain why things went well or not so well. You certainly can't give your boss 100 numbers. He would like to have that in a nutshell.

That is your situation. So you're trying to get the most meaningful numbers out of the jungle. Depending on the size of the company, this should be between four and seven key figures. That is quite enough. Remember that there are more numbers behind these numbers.

Difference between quantitative and qualitative figures

In order to interpret and classify the correlations correctly, it is important to distinguish between qualitative and quantitative sales figures. The quantitative key figures are clearly easier to evaluate. These are values that are particularly easy to observe and measure. They make it particularly easy to define sales targets:

  • Revenues within a specific timeframe
  • Sales quantity in number of units or monetary value
  • Working hours and capacity utilization of sales employees
  • New customers within a time frame

Please note, however, that you must precisely define the framework conditions in which these figures arise. This means that, in addition to the metrics, you must also define the resources available to sales employees to meet the requirements. Only if the conditions are the same can the employee figures be compared and evaluated.

In contrast to this are the qualitative key figures. In most companies, they play a subordinate role because they are more difficult to determine and evaluate. Many sales managers do not take the trouble to formulate and evaluate them correctly. Looking at the quantitative key figures is easier and more meaningful. In the long run, however, good sales work is characterized by qualitative characteristics. Therefore it is important to take them seriously.

As the name suggests, it is first and foremost a question of the quality of the sales work. This is of course difficult to measure and should at best also be reflected in the quantitative figures. How good the sales work is can be measured by various facts:

  • Creating and optimizing your own documents
  • Analysis and maintenance of the customer management system
  • Quick and easy communication within the sales department
  • Improvement of customer satisfaction through trained and well-trained sales staff
  • Image cultivation through further training and constant offers to supplement skill

The focus is clearly on the skills salespeople need to bring, but also on the opportunities provided by the employer to do their job best. When new products come onto the market, the sales team must be informed before the time comes. Structural changes within the company can also affect sales. "What do you plan for the future? When will your new product be launched? What will it cost? All these questions and many more can occur in a sales talk. It is important that as many questions as possible can be answered.

It is not easy to observe and measure these qualitative measures and to formulate new goals. However, they reflect the competence and the actual possibilities of a sales team. The further training courses form the training. The knowledge and skills acquired are important for the actual "game". This is the same in sports as in sales. Those who think they can do everything and don't need "training" will soon notice that they will fall by the wayside at some point and will no longer be able to reach their figures.

Drawing the right conclusions and introducing changes

However, all numbers would be useless if they were not read correctly. It is therefore important to draw the right conclusions from the figures. It often happens that statistics can be interpreted differently.

Your sales staff have too few online demos. They therefore instruct them to hold more demos and thus increase the chance of closing a deal. At the same time, you don't expect more cold calls from them. Now the question is whether the problem really comes from the online demos. The number is of course too low, but it also depends directly on the number of calls that are made. As a sales manager you have to use the lever and increase the number of calls. This should automatically result in more online demos.

So you have increased the number of phone calls, but the number of web demos remains low. How do you explain this? In this case, it's no longer about the quantitative numbers, but about the qualitative ones. Obviously, your sales staff need extra help on the phone.

If the number of demos is correct, but the sales are not, it may be due to the quality of the online demos or the product. So the chain goes on and on. You record the problems and have to draw the right conclusions from the data you have in order to get the sales or business of the company on the right track or to keep it that way.

This is how key figures can be structured:

  • Monetary/non-monetary/mixed
  • Past related/future orientated
  • Results/process
  • Pipeline
  • Permanent/temporary

Key Performance Indicators are not everything

Key figures in sales are therefore not only results, but also stand for targets and a goal. They serve the purpose of analysis and incentive. The trick is to find out the KPI indicators that are important for your own goals and to interpret them. The figures grow with your own demands and goals. They reflect the demands and reality. As in sport, however, the statistics do not tell the whole truth. Despite numbers, a sales manager must never forget the circumstances under which they came about.

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