What Separates High-Performing Sales Organizations From Average and Underperforming Sales Organizations?
That’s what Velocify, along with Steve Martin, author of the “Heavy Hitter” series of books on enterprise selling, set out to discover. They asked 800 sales executives, managers and front-line sales reps a whole lot of questions—42 of them to be exact—to get at the answer.
The results of their study, which can be downloaded here, should be of interest to any sales leader. The report aims to show how high-performing organizations differ from average and underperforming organizations in terms of attitudes and structure.
Survey respondents were asked to compare year-over-year revenue growth for the past 2 years. Those that characterized their growth as significant were rated as high performing organizations. Those that characterized their revenue growth as flat or declining were rated as underperforming organizations (those in between were characterized as average).
The report offers up a summary of how people in each group responded to the questions. It’s interesting to note that 47% of the respondents were quota carrying salespeople. It could be enlightening to see how their responses compared to those of sales leaders.
Here are some of the key highlights from the study:
- High-performing sales organizations set higher quotas and expect fewer sales reps to meet their quota
- Mediocre sales organizations were slower to fire underperforming sales reps
- The best-performing sales teams were more likely to describe themselves as a “cohesive group”
According to the study, three key differentiators separated the great sales teams from mediocre teams according to the study.
Differentiator #1: Aggressive Goal Setting
The best performing sales teams consistently set higher quotas and expected fewer sales reps to meet quota.
46 percent of respondents at high-performing organizations said that less than 60 percent of salespeople should make quota, compared to just 30 percent of respondents at average and under-performing organizations.
18 percent of high-performing sales organizations indicated that salespeople will be terminated for poor performance after one quarter compared to only 2 percent of average and 5 percent of underperforming organizations.
Differentiator #2: Team Mentality
A team-oriented outlook was more prevalent among high-performing sales organizations.
High-performing sales organizations were nearly twice as likely to describe themselves as “a cohesive group of like-minded individuals” than people at lower-performing organizations, who more often described themselves as “a loose collection of individuals.”
The best teams also viewed individual talent as a lesser factor for sales success than mediocre groups, but were less likely to include below-average salespeople – exhibiting a more unified sales culture.
Differentiator #3: Process-Driven
High-performing sales organizations were more likely to employ a structured sales process than others.
High-performing sales organizations were almost twice as likely as underperforming organizations to describe their sales processes as “closely monitored” or “strictly enforced or automated.”
High-performing sales organizations ranked “disciplined sales process and systems usage” as the second most important factor separating great from good sales organizations. They were also more likely to closely monitor lead follow-up than lower-performing organizations.
The report, “The Sales Organization Performance Gap,” includes analysis and survey results for 15 key questions. Here are a few (somewhat re-worded):
- What is the optimum percentage of salespeople who should make quota to validate that quotas are not set too high or too low?
- How soon is a sales person terminated for poor performance?
- In what order should the factors that separate great from average (and from underperforming) sales organizations be prioritized?
This last question uncovered an interesting result. Both the high performers and the good performers ranked “lead generation and pipeline activity” as the most important factor, above six other factors including sales leadership and sales talent.
Comparing how you would answer these questions to those of the survey respondents just might cause you to re-think the attitudes and structure of your own organization.
As a special note, if you’re interested in how decisions about sales technology compare between sales leaders at high performing sales organizations and those of under-performing organizations, get ready for our own upcoming Smart Selling Tools survey. We’ll be going to field the first week of February.
How about you? Was your organization an under-performer, average or high-performer? Do your answers mirror those reported? What do you think it takes to out-perform the average sales organization?