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Sales management is changing. In the Sales 3.0 world that we live in today, the use of data and automation is non-negotiable. This is where sales performance management or SPM comes in.
An innovative sub-discipline of management and sales, SPM takes traditional sales management and infuses it with the power of data to optimize the entire gamut of sales functions, from territory mapping and capacity planning all the way to incentive design and forecasting.
To enable sales performance management to thrive in an organization, the use of technology is key. Homegrown software or, worse, data scattered across multiple spreadsheets won’t do the job. Enter SPM platforms.
In other words, SPM software aid in the creation of an agile sales ecosystem by offering you a holistic view of your sales functions and their performance and enabling digital transformation in a quickly changing market.
If you’re still wondering why you should opt for an SPM platform, here are some key business challenges that these new-age systems help address.
Challenges faced by sales performance management solution providers
Here are the most important business challenges faced by sales performance management solution providers.
1. Non-compliant systems
When it comes to regulatory needs, homegrown systems can quickly become non-compliant. Having the right controls and solutions in place can mean a lot - from avoiding delayed payments to making hefty payments for non-compliance.
New regulations can also affect the sales organization by impacting incentive pay. These regulations may vary from state to state.
An SPM platform that offers features such as effective dating, efficient management of personal information, and more can effectively plug these compliance challenges.
2. Lack of insight into spending and performance
Home-grown systems and manual solutions do not allow you to leverage past, current, and projected performance data to optimize various sales functions.
How sales spend in driving performance is essential information that every sales leader needs to be cued in.
Additionally, this is time-sensitive. These insights need to be made available to the right stakeholders before the relevant sales period is passed.
Modern SPM platforms offer AI-recommended changes and model these changes before making them and allow users to target the desired changes as required.
3. Inability to handle complexity and business maturity
In time, businesses outgrow manual solutions that do not lend themselves to complex eligibility or crediting rules.
For large sales teams, in particular, ensuring effective dates are accurate across the system is virtually impossible using manual solutions. Quotas, territory allocation, and rules of engagement further complicate matters.
In the end, homegrown solutions, at best, only cater to current needs and will not lend themselves to the needs of a more complex and mature business.
4. Higher-than-optimum time-to-market
Organizations start their planning cycles anew each year. Compensation plans need to be designed, territories allocated, quotas set, and salespeople communicated as soon as possible.
Sales results are directly impacted by the time it takes to deliver this information. Completing planning, releasing the plans, and tracking the process's completeness are all made extremely difficult by manual solutions.
SPM platforms make these tasks simple for both comp admins as well as sales representatives.
5. Erosion of transparency and trust
Your sales team is a key asset you do not want to lose. And transparency is crucial to earning their trust when it comes to crediting and payments. Salespeople who do not trust the internal processes are at a high risk of experiencing and spreading low employee morale and, along with it, sales attrition.
Manual solutions that offer only limited details and infrequent crediting often do nothing to guard against these troubles.
SPM platforms, on the other hand, ensure frequent crediting and complete transparency, often right through your sales reps’ mobiles, allowing them to assess their current and potential performance readily.
If your organization faces any of these challenges, and sales performance management platform may be just what you need. Here are some of the key capabilities a good SPM platform can and should deliver.
10 Things to look for in a best sales performance management software
Here are 10 things to look for in the best sales performance management software.
1. Artificial intelligence and machine learning capabilities
With automation comes the capability to use your data better and perform continuous analysis. With AI/ML algorithms' application to such data, you open doors to endless insights and value addition.
The best SPM platforms help you to use your data even more effectively using intelligent technology. Once each part of your organization has been automated, it is time to add intelligent technology to enable data analysis and continuous learning to enable sales strategy planning.
2. Performance analysis and optimization
To enable continuous analysis, real-time insights are necessary. Your SPM platform should offer real-time or near-real-time analytics for each of your sales functions. This will enable you to optimize your planning.
Industry pay and performance data is something else that a good SPM platform should be able to offer you. This data can then be used to benchmark incentives and ensure that your pay is competitive and that any pay gaps are eliminated.
3. Quota planning & management
Salesforce published its third annual State of Sales report last year and found that 57% of sales reps did not meet their quotas in 2019. This indicates that it is important to get your quotas right when you assign them to your reps.
Your SPM solution should offer you multiple quota planning options, including top-down and bottom-up quota setting.
Moreover, as several diverse factors affect quota planning, it should allow you to pull data from multiple sources while setting your quota and applying artificial intelligence to recommend optimal quotas.
4. Territory design and management
Territories are a sensitive subject in sales organizations and can trigger low employee morale and performance.
To ensure your reps do not think their territories have been unfairly assigned, technology can be used to optimize territory design. In fact, such a move results in 30% higher quota attainment, as research has found.
Ideally, your territory design and management solution should be interactive and flexible so as to allow you to design rule-based territories and also integrate them with your quota planning solution. It can often even pull in third-party data to ensure the territories are optimized to help your sales reps succeed.
5. Incentive compensation management (ICM) and accounting
As the biggest driver of sales behavior, compensation structure and getting it right is crucial to your organization. Your ICM solution should ideally aid in the optimization of every part of compensation.
This includes plan design, credit assignment, payout calculation, exception handling, and more. It should also help your accounting team stay compliant and easily throw up the data required for commission accounting.
6. All-in-one sales planning
Effective sales planning lies at the heart of your sales organization and is the cornerstone of its success.
Your SPM platform should have sales planning capabilities that allow you to plan for revenue and headcount, accurate team size, coverage, and more. All this should be done while taking growth potential into account by one solution rather than requiring additional sales management tools to get it done.
7. An integrated SPM platform
It is important to ensure that your SPM platform takes a holistic approach to sales management, offering you sales capacity and quota planning to incentive and territory design with possibilities for optimization at every stage.
Besides, your Sales Performance Management solutions vendor should have kept your current and future needs in mind. The platform should be able to scale with your organization and allow for the integration of additional platform solutions.
8. Integration of data across solutions
It is key that you transfer and integrate your data across systems for your organization to perform at a high level.
Automation and streamlining of critical data flows and seamless integration with your other data architecture systems, such as ERP, CRM, HRIS, and more, are critical.
9. Training and certification
A vendor that offers in-depth training and certification to transfer information about best practices and develop your usage skills will prove critical if you are looking to use your SPM platform effectively.
In case you have a large sales team, it may also be required that you look for vendors that offer training by product and through different modes, such as online, in-person, etc.
10. Recognition from key analysts
Selecting a Sales Performance Management solutions vendor can call for research, hours of analysis, demos, and more.
Make this process easier by looking for a vendor that is recognized as a leader by key analysts, such as Gartner, Forrester, and the like. Each analyst represents a certain set of crit and also showcases breach vendors of the strengths and vendors.
Is your incentive program broken?
As the key driver of sales behavior, your incentive program is a key part of getting the SPM puzzle right for your organization. But running incentive programs manually leads to a lack of visibility into incentive structures, delayed payouts, and more, ultimately resulting in widespread poor employee morale and even sales attrition.
In a dynamic and quickly changing market, Xoxoday Compass incentive gamification software may be just what you need. With Xoxoday Compass, you can power up your sales engine to function as the revenue engine you want it to be!
Supported by game mechanics that are designed to deliver improvements to your entire sales team, Xoxoday Compass not only offers live updates and clear visibility into your incentive program but also makes flawless payout calculations even single time and even offers instant payouts.