What is Sales Productivity and How to Improve It

by Matan Mostov
August 19, 2023
Sales Productivity
Demo Best Practices
Guided Selling
Sales Enablement Best Practices
Sales Management
Sales Performance

Every seller’s dream, and even more so every sales team leader’s dream, is to reach optimal productivity. But, realizing this dream is no small feat. According to Salesforce, sales reps spend only 28% of their week selling. What do they do for the rest of the time? In this blog, we’ll explain how to improve sales productivity to help you turn those statistics around.

What is Sales Productivity and How to Improve It

Every seller’s dream, and even more so every sales team leader’s dream, is to reach optimal productivity. But, realizing this dream is no small feat.

According to Salesforce, sales reps spend only 28% of their week selling. What do they do for the rest of the time? Nothing truly productive: “They spend more than two-thirds of their time distracted by record keeping, broken processes, tool management, and tasks like data entry and lead management,” reports Salesforce.

But, sales inefficiency encompasses more than just poor time management. It involves factors such as ineffective training, insufficient technology infrastructure, and other contributors.

Here, we’ll explain how to improve sales productivity to help you turn those statistics around.

Here’s what our extensive guide includes:

What is sales productivity?

Sales productivity measures the relationship between your seller’s effectiveness (accomplishing something while wasting the least amount of resources, time, and effort) and their efficiency (the ability to produce the desired result).

By optimizing both effectiveness and efficiency, organizations can significantly improve cost, time, effort, and the ability to meet quotas.

Why is sales productivity important?

Improving sales productivity in general, and B2B sales productivity specifically, positively impacts various aspects of your business, but there are two crucial areas where productivity plays a significant role. 

1. Boost the bottom line. Enhancing sales productivity directly translates to increased revenue generation by your sellers. 

The performance of your sales team is a mirror of your company's overall success, and improved sales productivity sets the stage for sustained growth.

2. Improve employee satisfaction. Research by Survey Sparrow indicates a direct correlation between employee satisfaction and their ability to perform effectively.

When salespeople perceive that their efforts contribute significantly to the company's success, their job satisfaction increases. This, in turn, reduces turnover rates and boosts revenue generation.

Calculating sales productivity

By measuring sales productivity, sales leaders can enhance their team's revenue-generating capabilities, and that is crucial for any organization.

It’s a given that high-performing sellers who consistently close deals directly impact overall success. By leveraging data-driven productivity insights, you can pinpoint the underlying reasons some sellers struggle and implement actionable measures to help them.

Unfortunately, many businesses don’t recognize how important it is to keep track of their seller’s productivity.

According to Sales Enablement PRO’s research, organizations that track the time dedicated to selling activities report a 4-percentage-point higher win rate compared to those that do not.

And yet, even though there is a positive impact on win rates, according to the same research, participation rates are low. Only 21% of businesses monitor the time spent searching for content, and only 23% of businesses monitor the time invested in manual data entry. 

This means that many companies are not fully capitalizing on productivity data, which in turn means there is plenty of opportunity to improve your sales operations. And that’s actually good news.

Sales productivity metrics and how to measure

When you measure sales productivity, you should do this at both the organizational and individual levels, as each offers unique insights.

Measuring sales productivity at the organizational level provides an overview of the overall sales performance, giving you a broad understanding of your sales department's effectiveness.

However, evaluating individual performance gives you a comprehensive view of your sales team's performance. 

Generally speaking, sales productivity measures three key areas: efficiency, effectiveness, and performance. 

Calculating sales productivity at the individual level

Sales productivity at the individual level can be calculated by measuring the outputs (effectiveness) and inputs (efficiency) of each seller. The specific metrics and formula used may vary based on the organization's objectives. 

Here are a few common ways to calculate individual sales productivity.

  • Revenue generated per hour: Divide the total revenue generated by a salesperson by the number of hours they have worked during a specific period. This metric provides insight into how effectively a salesperson converts their time into revenue.

Formula: Revenue generated / Hours worked

  • Quota attainment: Measure the percentage of a seller's assigned quota that they have achieved within a given period. This metric evaluates their ability to meet or exceed their sales targets.

Formula: (Actual sales / Quota) * 100

  • Conversion rates: Analyze the conversion rates at various sales funnel stages for each salesperson. This helps assess their effectiveness in progressing leads through the sales process.

Formula: (Number of conversions / Number of leads) * 100

Calculating sales productivity at the organizational level

Sales productivity at the organizational level focuses on the overall sales performance and efficiency of the sales team as a whole. 

Here are some common ways to calculate organizational sales productivity.

  • Total revenue generated: Sum up the total revenue the entire sales team generated during a specific period. This provides an overview of the sales department's overall performance in terms of revenue generation.
  • Revenue growth: Measure the percentage change in revenue from one period to another. This metric helps evaluate the sales team's ability to consistently drive revenue growth.

Formula: [(Current period revenue - previous period revenue) / Previous period revenue] * 100

  • Customer acquisition cost (CAC): Calculate the average cost of acquiring a new customer. This metric evaluates the efficiency of the sales team in acquiring new business.

Formula: Sales and marketing expenses / Number of new customers acquired

These are just a few examples of how sales productivity can be calculated at both the individual and organizational levels. Adapting the calculations to align with your organization's specific goals and metrics is important.

What is good sales productivity?

Good sales productivity is achieved when sales teams and individuals efficiently generate revenue and achieve their targets while effectively utilizing resources. 

Ultimately, good sales productivity is a combination of achieving revenue targets, converting leads into customers, meeting quotas, utilizing resources efficiently, and maintaining high levels of customer satisfaction. 

The specific benchmarks for good sales productivity will vary based on the industry, company goals, and individual circumstances.

How to increase sales productivity

Automate processes and tasks

According to Mindtickle's 2022 Sales Enablement Outlook Report, nearly three out of every ten organizations (28%) employ ten or more tools in their efforts to enhance sales productivity. However, despite this reliance on numerous tools, the majority of organizations still need to improve their ability to meet sales quotas and achieve desired revenue outcomes.

Does that mean sales tools cannot help? Quite the opposite. What it means is that you need to get the right digital tools and make sure they are right for you. 

In fact, advanced sales tools can significantly increase sales productivity and allow productive sales reps to focus mostly on selling and nothing else.

This is illustrated by HubSpot's 2021 Sales Enablement report, which found that 45% of underperforming sales teams use essential tools such as a CRM platform. However, they overlooked the implementation of automation features. Consequently, these businesses did not achieve the same level of growth and productivity observed in teams that embraced automated technology.

Implement guided selling tools

Guided selling technology is a strategy that involves providing salespeople with the necessary tools, resources, and guidance to navigate the sales process effectively. It can improve sales productivity in several ways:

  • Streamlined sales process. Guided selling technology provides a clear structure and roadmap for salespeople to follow during customer interactions. It outlines the necessary steps, information, and actions required at each stage of the sales cycle. 

This streamlining helps salespeople stay focused, save time and avoid unnecessary detours, ultimately increasing productivity.

  • Improved sales efficiency. By providing salespeople with relevant and personalized content, guided selling technology enables them to effectively address customer needs and concerns. 

This leads to more efficient and productive sales conversations, as salespeople can quickly access the right information and tailor their approach based on customer preferences and pain points.

  • Enhanced sales effectiveness. Guided selling technology empowers salespeople with best practices and proven strategies that have been successful in the past. It equips them with the knowledge and techniques in real-time to effectively communicate value propositions, overcome objections, and close deals. 

With a clear understanding of what works, salespeople can operate more confidently and achieve better results, increasing their overall effectiveness and productivity.

  • Consistency and replicability. Guided selling technology ensures that salespeople consistently follow established sales methodologies and processes. This consistency leads to more predictable outcomes and allows organizations to replicate successful sales approaches across the team. 

By providing a standardized framework, guided selling technology reduces guesswork and enables salespeople to focus their efforts on executing proven strategies, resulting in increased productivity.

  • Continuous coaching and improvement. Guided selling technology encourages ongoing coaching and development for salespeople. It facilitates the sharing of best practices, feedback, and insights from successful sales experiences. 

By continuously refining their skills and knowledge, salespeople can adapt to changing customer needs and market dynamics more effectively, leading to increased productivity over time.

  • Make sure all teams are aligned. With the right tech tools, sales and marketing teams are fully aligned, resulting in consistent messaging and personas across the organization.

In addition, this alignment can contribute to improved sales team performance by reducing errors and avoiding mixed messages.

3 Strategies For Driving Sales Productivity

By regularly improving the following areas, you can ensure your seller’s productivity will constantly improve.

1. Adopt AI tools

It’s the 21st century, people! AI is available to you. You just need to be willing to adopt it. 

According to a Salesforce report, 97% of sales leaders and sales operations pros say AI gives reps more time to sell. “This isn’t just a theoretical productivity booster, either,” says Salesforce. “As our report reveals, high-performing reps are 1.9x more likely to use AI.”

With AI, your sales representatives no longer have to spend valuable time searching for content and aligning it to the right target audience and sales stage. An innovative AI assistant can guide sellers during live calls, helping them close more deals and eliminate tedious, unproductive tasks.

Furthermore, forward-thinking organizations that harness the power of AI-guided selling technologies are leveraging their data and insights to empower their sales reps. By eliminating the need for sales reps to scramble for content, sellers can allocate more time and energy to building relationships with buyers. 

AI-guided selling technologies also ensures that sellers consistently connect buyers with the most relevant content in real-time. Once you have a clear understanding of what resonates with your target audience, you can replicate and scale those successful strategies.

2. Great sales training is imperative

If they don’t receive quality training, your sellers will have to resort to trial and error, which is the opposite of productivity. 

There are many benefits to good sales training. Some of the most important ones are:

  • Increased sales productivity: Sales training can help sellers learn how to close more deals and generate more revenue.
  • Improved customer satisfaction: Sales training can help sellers learn how to better understand and address customer needs.
  • Increased sales team morale: Sales training can help sellers feel more confident and motivated in their roles.

No matter which sales method you use - classroom training, e-learning, or on-the-job training- all sales training programs should be designed to help sellers learn the skills and knowledge they need to be successful.

Here are some tips for creating an effective sales training program.

  • Make sure the training is relevant to the sales team's needs.
  • Use a variety of teaching methods to keep the training interesting and memorable. Take into account that trainees only retain 28% of the information you provide them, so improving teaching methods can go a long way toward improving the forgetting curve.
  • Make the training interactive so that sellers can participate and learn by doing.
  • Provide opportunities for sellers to practice what they have learned.
  • Evaluate the training program to make sure it is effective.

3. Utilize the superpower of your enablement platform, AKA data

An advanced sales enablement platform can offer not only sales asset management. A good enablement tool should also be able to provide you with valuable data on individual sales reps' workflows and help you identify what can be improved. 

In fact, according to research conducted by LinkedIn, a significant majority of sales professionals (73%) utilize sales technology as part of their sales process to secure deals. Among those who incorporate sales technology, an overwhelming 97% recognize its crucial role in driving their success.

Here’s an example that will illustrate this point. Say you have created a new playbook based on the practices of one of your star sellers, but a couple of weeks later, when you look at the usage data, you realize that only a few sales reps have been using it. This tells you what you need to do (encourage sellers to use the new playbook) and uncovers an improvement opportunity (to boost the effectiveness of your reps further).

Leveraging all the insights and capabilities provided by an enablement platform allows you to discover inefficiencies and fine-tune your sellers’ performance. By optimizing your sellers’ workflows, you ensure that your efforts enhance their effectiveness rather than hinder it.

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