10 People Revenue Insights That You Need To Know As You Grow Your Sales Team
Every sales leader believes the most important factor to scaling your team starts with their people. No matter how great your product is, if you are unable to hire, ramp and retain great sales talent, its going to limit your ability to grow quickly and successfully.
Despite this being the case, one area where analytics has lagged behind in terms of its impact is with your people. The reason for this is that people data is not financial is structure and format. This makes it difficult for sales leaders to gain actionable insights for their team growth strategy and make adjustments that can boost revenue growth.
For sales leaders to derive complete financial value from their people data, they need to apply people financial metrics to there sales team people data. By applying people financial metrics, it is then possible to optimize your sales team growth strategy for long-term revenue growth. This can help you avoid a lot of the growing pains that come with scaling sales teams before it impacts your revenue and allows you to stay on track with your revenue goals.
Below we share 10 people financial insights that can derive from your sales team people data that can help you drive revenue growth for your sales team.
1. The Cost of Turnover & Its Impact On Revenue
A high turnover rate on your sales team can be a detrimental, but it is even more critical that you know the cost of turnover of your sales team. Even if your turnover rate is low, your cost of turnover can be high. If you are growing your sales team quickly, it could be worthwhile for you to track how your turnover is impacting your revenue goals. We find that turnover costs are on one the biggest people factors that impact revenue growth on sales teams. The reason is simple: the cost to replace a sales rep is high as it takes time to hire, onboard and ramp up new reps.
2. The Revenue Impact of Your Hiring Fill Rates
When scaling your sales team, how quickly and who you hire is critical to your success. One of the most common areas we see growing teams struggle is not hiring fast enough for their aggressive financial goals set for the year. You need to make sure your hiring fill rates are good enough so you can make sure you have sales reps ready to produce for your team. To often we see sales team with great sales numbers hit a roadblock because they are not hiring sales reps fast enough that align with their financial goals.
3. Sales Rep ROI
Another metric that you need pay attention to as you hire for your sales team is Sales Rep ROI. Sales Rep ROI refers to the revenue your reps bring in minus salary, commissions, cost to on-board, hire and any ongoing people related investments (enablement, training, etc.). This number helps you better understand what your revenue to cost multiplier is per/sales rep and gives you a baseline to see where each of the ROI factors can be improved over time. It also provides you insight into where you could make adjustments to increase ROI, whether its increasing efficiency in certain sales ops areas or implementing new solutions that grow this metric.
4. The Revenue Impact of Your Onboarding Process
Some sales teams have elaborate onboarding processes and others don’t, but what’s most important is how your onboarding is impacting revenue. Ideally, when you hire new sales reps, you want to on-board them as quickly and efficiently as possible. The best way to measure the impact of your onboarding process is to see how quickly sales reps are getting their first deal. On the surface it might seem your onboarding process is doing great, but if you are not tracking how quickly reps are getting deals within the first 3-6 months of their employment in relation to your onboarding, then you could be missing key areas for optimization.
5. The Value of Promoting Internally vs. The Cost Of Hiring Externally
Every organization wants to hire and promote their sales reps internally. For some, it makes perfect financial sense to build their team through internal promotion, for others it makes sense to try and strike a balance between external hiring and internal promotion. You not only should know what the value is of promoting internally for your sales team, but also how it compares to hiring externally for those exact same roles. This can help you determine when it makes sense to promote your reps, figure out the right level of benefits and compensation and even determine whether investing in the professional development of your employees could make a big difference.
6. The Revenue Impact of Getting A Quality Applicant
When growing your organization, the top of the hiring funnel is critical to your ability to hire reps quickly and efficiently. It can be easy for you to get applicants, but the cost of getting a quality applicant is more important. Ever organization defines a quality applicant differently, but we like to define it as someone who moved on passed the 1st round of the interview process. The higher volume and less costly it is for you to get a quality applicant, the more likely you are going to be able to fill your team with top talent. Sometimes organizations focus too much on getting total applicants in the funnel, the problem with this metric is it causes you to focus on sales recruiting strategies that might get a higher volume of candidates, but not the best quality candidates for your organization.
7. The Financial Impact of Your Admin vs. Selling Ratio For Each Rep
Another core area where people insights help is measuring the productivity of your sales reps. Ideally, you want your sales reps to spend less time on admin (sales ops, for example) and more time on selling. The more time they have to sell, the more likely they will follow-up and focus on getting deals closed. If this ratio is out of sorts, you could be leaving money on the table as you scale your team. You don’t want sales reps missing selling opportunities because of their time spending doing admin work.
8. The Revenue Impact of Sales Length
The time is takes to open a deal and close a sales is critical to hitting your yearly revenue goals. The longer it takes to close a deal, the less money you can bring in. The best way to generate insight from this is by looking at each stage of your sales cycle to see if there are any inefficiencies that can be overcome. By analyzing every stage of your sales cycle, you can figure out if the areas that are holding your sales reps back are your sales operations process or the sales reps themselves. This gives you insight to see whether its your people or your process that limiting your revenue potential.
9. The Revenue Impact Your Offer Conversion Rates
You got some top candidates you like in your sales rep hiring funnel, but what if you offer them and they decline your offer? You need to pay attention to your offer conversion rates and how its impacting your revenue. For example, if 3 out of 5 employees you make offers to turn it down for other jobs, its going to limit your opportunity for fast team growth. You need not only keep track of this number, but know how offer declines can impact revenue if you are not filling sales roles fast enough for your organization. If you see your offer conversion rates drop, you need to analyze what’s causing this.
10. The Revenue Value Of Investing In The Professional Growth Of Your Employees
If your team growth strategy is built on hiring junior-level employees and promoting within your organization, you need to pay attention to see if there is any financial benefit to investing in the professional development of your sales reps. As an example, organizations promote employees to higher levels within an organizations because of turnover risk, but those promoted employees can under perform if they are not being trained in new skills that causes them to perform at the highest level. One area you need to look at closely is for sales reps that are promoted into first-time management positions. This is where we see this number become financially impactful, as poor people management can lead to turnover costs.
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