Plan for Improving Revenue Outcomes
Learning Objectives
After completing this unit, you’ll be able to:
- Recognize the different types of metrics that affect company revenue.
- Explain how metrics can help you make adjustments to enablement programs.
Types of Metrics That Affect Revenue Outcomes
A sales organization is typically interested in improving outcomes for these specific metrics that affect your company’s revenue.
- Ramp time
- Win rate
- Cycle length
- Deal size
Ramp Time
In the previous unit, you saw how Jose Figueroa, the sales manager at Cloud Kicks, came up with an effective model for improving his enablement program to address the Ramp Time metric. One of his sales reps, Candace Evans, was struggling with completing her enablement content within the expected time. And that obstacle was preventing her from making calls, opening opportunities, and ultimately closing deals—the goal that directly affects revenue for Cloud Kicks. Jose proposed changes to his enablement program to help improve that specific metric.
Now, let’s look at a few other examples to see how Jose’s model can be applied to other metrics that affect revenue outcomes.
Win Rate
Let’s say that your company’s sales model expects a 15% win rate (winning 15% of opportunities). But your sales organization has been struggling and only achieving a 10% win rate. How can you boost the win rate? You theorize that sales reps aren’t speaking with the right people. For example, maybe sales reps aren’t speaking with retailer personnel who are authorized to make contract decisions. You want to adjust your enablement program to make sure that sales reps see content about identifying appropriate roles within a prospect’s org tree.
Here’s how the model can help define a program for this metric.
Part of Program | Goal to Achieve | How to Measure Achievement in Salesforce |
|---|---|---|
Outcome | Sales rep increases win rate from 10% to 15%. | Count a certain number of closed deals among available opportunities that equals 15% won, such as 8 deals closed out of 50 opportunities. |
Milestones | Sales rep books 20 meetings with decision-makers. | Count how many events a user schedules as sales calls with contacts in an appropriate role. |
Exercises | Sales rep completes content that focuses on how to identify decision makers. | Require the rep to complete all related content. |
Cycle Length
Imagine that your sales organization typically takes about 75 days to close deals. But due to the average size of those deals, sales reps are expected to close deals in less than 60 days to hit target profitability margin. You suspect that sales reps are great at generating opportunities and great at closing deals, but they struggle to sustain activity in the middle of the pipeline. You want to adjust your enablement program to make sure that sales reps consume and apply content about deal urgency and acceleration.
To help decrease cycle length, you make these adjustments to the sales rep enablement program.
Part of Program | Goal to Achieve | How to Measure Achievement in Salesforce |
|---|---|---|
Outcome | Sales rep shortens the average close cycle from 75 days to 60 days. | Count a certain number of opportunities that close in 60 days or less. |
Milestones | Sales rep improves mid-pipe activity before closing a deal. | Count opportunities that spend less than 30 days in qualifying stages |
Exercises | Sales rep completes content that focuses on deal urgency and acceleration. | Require the rep to complete all related content. |
Deal Size
What if your sales organization operates efficiently, but your average deal size is too low (say, less than $50K) to deliver your target profit margins? Perhaps sales reps are offering discounts too frequently and competing on price rather than the value of your product. You want to adjust the enablement program to prioritize value-based selling (helping prospective customers understand the value your product creates for them, at all steps of the pipeline).
Your model for achieving this metric might look like this.
Part of Program | Goal to Achieve | How to Measure Achievement in Salesforce |
|---|---|---|
Outcome | Sales rep increases the average deal size. | Count five opportunities that close with a value over $50K. |
Milestones | Sales rep sells on value. | Count calls that use value-based script and language. |
Exercises | Sales rep completes content that focuses on value-based selling. | Require the rep to attend a training course and complete all related content. |
Adjustments and Iterations
In each of these examples, you start with a particular revenue outcome that you want to improve. You adjust your sales program to help achieve that outcome target, and give your sales reps a better understanding of why these adjustments are being made. Moreover, because the outcomes affect company revenue, sales reps are more incentivized to achieve those outcomes, and you can prove the ROI of the programs you run.
The specific metrics associated with each outcome, behavior change, and content strategy also help you monitor how well the adjustments are working. You can gather data about your sales program’s effectiveness, which helps you make further improvements. If you don’t see an improvement in the outcome that you planned for, you can troubleshoot and adjust based on the data gathered from the current iteration of the program.
For example, recall the Deal Size example. Maybe sales reps have completed their training session, passed their knowledge check, and completed 10 calls without mentioning a discount. But you haven’t seen the average deal size increase. Maybe your theory for explaining a lower average deal size wasn’t accurate, and you want to try adjusting a different behavior. This framework provides that flexibility and insight to respond to results and implement new strategies for achieving your business outcomes.
In the previous unit, you saw that Cloud Kicks used a spreadsheet for tracking the sales program rolled out to new sales reps. In the next unit, see how Jose uses the power of the Salesforce Platform to implement and monitor these types of outcome-based enablement programs.