The answer lies in the key performance indicators (KPI) . In short, the KPI are a resource used by managers to keep track of the most important statistics. When used correctly, the KPI are powerful tools to compare different variables in relation to the organization, products and employees, as well as providing suggestions based on the results.
If desired, managers can create custom KPI that suit the specific needs of their businesses. While this is an extremely useful practice, it should not replace certain fundamental KPI that the best sales leaders use in their organizations. To better understand some of these essential KPI, I developed the following three scenarios:
Bill is the founder and owner of a small company that manufactures an orange flavored drink called Frutalísima. Currently has 10 representatives responsible for visiting the shops, take orders and audit. Each of them has an assigned territory, consisting of a variable number of establishments and is expected to cover that area weekly.
Although sales are high and most retailers seem satisfied, Bill is concerned that some of their representatives are performing poorly. To address this concern, Bill uses a KPI coverage territories representatives.
In order to quantify the data, Bill collects data from the visits of relevant employees to a full week and starts waste to its KPI. Add the total number of stores in all territories and divide it by the number of representatives to obtain an average size of territory. Then does the same with the number of visits made.
By dividing the average number of visits by the size of territory, you obtain an average coverage areas for the entire organization. Now, Bill can compare the performance of each representative from the average of the company and know what representatives are lagging compared with their peers in terms of productivity.
To take this a step further, Bill could not set your KPI to offer recommendations based on the size of the current territory of the representative, the coverage rate and comparison with the average.
Jennifer is regional manager of Relojex, SA, a company producing luxury watches with good presence in the retail market. Among the main tasks include Jennifer track product sales and create new sales promotions for a variety of watches. While sales of watches give good results, Jennifer has found that certain promotions work better than others, and wants to better understand which promotions should be offered. With this in mind, Jennifer begins to check your data and sales promotions to better use the KPI impact of price promotions.
To start, take three promotions you think are most effective and enter the discount retail offering each promotion. Then add the sales data and enter both the original retail price and the number of sales that occur at every price point. Customizable template KPI Jennifer does other work for her and quickly shows the impact on sales of each promotion for each product, as well as the average impact of each promotion had on all products.
With all this information, Jennifer has the ability to choose the most effective promotions hereinafter manner, taking into account the profit margins of each product and increased sales generated from promotions. Over the next months, Jennifer stores quickly become sales leaders for Relojex brand, largely because of its decision-making based on data.
Two years ago, Jack opened his own local business cleaning and pool maintenance. Since then, it has expanded to 7 people more and in the process has hired 10 sales representatives.
The pool cleaning business is booming, but Jack wants to expand faster and believes that a more comprehensive process on employee performance review will allow you to achieve your goal. Since all representatives are equipped with mobile software management activities in the field, Jack can see in real time the time that an employee is approaching a new account. To use these data to the maximum, Jack KPI uses adaptive potential new accounts.
Jack decides to make a weekly tracking numbers of visits to new accounts for each employee over the next month, and then take action depending on the results. To begin, Jack enter the name of each employee in the KPI template; then keeps track of visits to new accounts made during the week and modifies the numbers as you enter new data. After the first week, Jack KPI shows what the average number of new accounts to which all employees approached and how they played each relative to the average.
The results were very interesting: the employee who presented the highest yield this week to more new accounts than three employees with the lowest yield came together. After 3 weeks, Jack note that the trend continues and decides to conduct a meeting with underperforming employees to encourage them to increase the number of new accounts that are approaching.
When adjusting continuously, Jack begins to watch week after week each employee is closer to the average number of potential new accounts. Now, we have developed a standard acceptable number of approaches per week, and Jack can propose clear goals for their employees and see a stream of new accounts will increase rapidly toward next year.
As these examples show, to enter data in an adaptive formula as collected allows the manager to quickly react to changes in their environment. Whether this involves changing the working conditions of employees, reduce costs in certain areas of business or offer a promotion for longer than another, the KPI for sales are a surefire way to quantify and better visualize the complex details of any deal.
If you want to know 12 connecting and detailed KPI that can help and inspire managers and business owners, this toolkit download free KPI here . Adapt the tools to your own organization is a great way to start making decisions based on your company data.
This article was originally written in English by Richard April , CMO B2B Marketing Technology.