White Paper. Sales analytics. The path to improving sales effectiveness

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1 White Paper The path to improving sales effectiveness

2 Contents 02 Getting started with sales analytics 03 Understanding the analytics maturity model Support sales operations Improve the quality of decision making Automate business processes 04 Apply analytics to increase sales effectiveness Sales management reports The importance of design Regularly evaluate your reports Explore for greater understanding 05 More sophisticated analytics and next steps 05 About IBM Industry Platforms Getting started with sales analytics Google is one of the most successful companies in the world. In 2017, they earned revenues in the amount of USD billion. How does a company one that offers most of its products at no cost go from being a startup to one of the most profitable companies in the industry in less than 20 years? What is the secret that makes Google so successful? It is no secret that Google earns most of its money from delivering advertising to websites, which made up 96 percent of Google s revenues in The competition in this industry includes companies like Microsoft and Yahoo!, but they are consistently outperformed by Google. Google s strength lies in applying extensive and advanced data analytics to determine which host websites are most likely to result in traffic for their advertisers from interested customers. There are many lessons to be learned from Google. A large portion of today s most successful businesses are applying the principles of data analytics to create competitive advantages and operate more efficiently. In the world of sales, data analytics can be applied to identify trends, improve sales success and increase revenue. Page 2

3 Understanding the analytics maturity model When applying analytics to the sales process, it is important to understand what analytics can do for your business. There are three distinct levels in the analytics maturity model. Each successive level signifies that a company is more effectively integrating analytics into their operations. This targeted approach can increase the likelihood of a high win rate for the team. Regarding infrastructure, this level requires the application of systems that provide predictive analytical modeling capabilities. These systems employ mathematical models that evaluate primary performance data points and make recommendations for suggested actions. Support sales operations Businesses in the first level of analytics maturity use data to support business processes and aid employees in decision making. An example of this level is a sales manager reviewing a report that shows the pending deals for a team. Based on this information, the sales manager is able to discuss the pending deals with the sales team and generate estimates of what sales revenues to expect. Many software solution provide basic reporting capabilities, including dashboards and query functions. Improve the quality of decision making The second level of analytics maturity entails using data to improve the quality of the decision-making process. Using the prior example, the sales manager is able to evaluate the sales data for the team and systemically identify trends, such as which products are more likely to sell in different geographic locations. Combining this information with the sales deals that are currently in the pipeline allows the sales manager to assist the team in targeting deals that are most likely to close. Automate business processes The third level is where analytics drive automation to improve business processes. Returning to the sales manager, if the third level of analytics is applied to the system, it then identifies deals that are at risk. The system then notifies both the sales manager and the front line sales person of the risk, and suggests a course of action that fits the situation. A time is then scheduled for the sales manager and sales person to meet and discuss strategy. This level of system maturity must use data from multiple disparate systems and apply sophisticated analytical models that look at multiple aspects of the business. Reaching this level of analytics requires years of work to understand the business and assemble the necessary infrastructure. Page 3

4 Apply analytics to increase sales effectiveness There are several ways that sales leaders and sales operations teams can apply the principles of analytics to improve their processes. Sales management reports The first step in applying analytics to sales is to use exceptional reports. Since the goal of analytics is to improve decision making and business processes, you must give careful consideration to the layout of reports to help ensure that they strengthen your sales methods. Use consistent terminology in reports and sales meetings to emphasize your methods and reinforce their importance among sales team members. Sales management reports must also provide information that helps to hold the sales team accountable for the deals that are in their pipeline. The importance of design When designing reports, it is important to balance aesthetics and necessities. To maintain meaning and ensure legibility, you must include necessary data fields while keeping the layout as clean and simple as possible. Try emphasizing critical components and reducing other elements. It often takes multiple iterations of layout design, review and refinement to create the right balance, but the effort often results in reports that are easier to look at and are more useful. Regularly evaluate your reports It is important for sales managers and sales operations to track the elements of reports and review which elements are working. If a report s purpose is to track all deals that are projected to close in less than 30 days, constant evaluation of the report can help determine if the listed deals result in successful closes. If the close rates are lower than expected, changing the report to reflect deals earlier in the sales process might improve accuracy. It is crucial to make tweaks and changes to find what works for you. Explore for greater understanding As you explore further, take the time to become familiar with your data. Invest time in learning how to query data and generate provisional reports. If you understand the information that you are tracking in the underlying systems and how it is organized, you can become extremely sophisticated in how you apply analytics to your work. Exploring might also reveal gaps in your system processes. By locating areas for change or improvement, you can facilitate better decisions in the future. Page 4

5 More sophisticated analytics and next steps When you have a solid understanding of the basics of analytics, consider how you can integrate more advanced analytics tools into your operations. There is a wide variety of advanced topics to consider as possibilities for sales effectiveness: Using analytics to improve support and services provided to sales teams. Automating the creation of sales performance incentive funds (SPIFs) based on sales trends. Supporting decisions for the management of coverage models for territory and quota setting. Employing the right tools is a critical component of bringing advanced analytics to an organization. Tools such as IBM Sales Performance Management in combination with IBM Watson Analytics can provide you with the infrastructure you need for managing sophisticated predictive analytical models. To learn more about IBM Sales Performance Management, visit: ibm.com/industries/sales-performance-management About IBM Industry Platforms IBM Industry Platform solutions delivers data-driven insights that help organizations work smarter and outperform their peers. This comprehensive portfolio includes solutions for business intelligence, predictive analytics and decision management, performance management and risk management. Business analytics solutions enable companies to identify and visualize trends and patterns in areas, such as customer analytics, that can have a profound effect on business performance. They can compare scenarios, anticipate potential threats and opportunities, better plan, budget and forecast resources, balance risks against expected returns and work to meet regulatory requirements. By making analytics widely available, organizations can align tactical and strategic decision making to achieve business goals. For more information To learn more about IBM Industry Platform solutions, contact your IBM sales representative or visit: ibm.com/industries/ sales-performance-management Page 5

6 Copyright IBM Corporation 2018 IBM Corporation Route 100 Somers, NY Produced in the United States of America, November 2018 IBM, the IBM logo, ibm.com, IBM Cloud and Watson are trademarks of International Business Machines Corp., registered in many jurisdictions worldwide. Other product and service names might be trademarks of IBM or other companies. A current list of IBM trademarks is available on the Web at Copyright and trademark information at This document is current as of the initial date of publication and may be changed by IBM at any time. Not all offerings are available in every country in which IBM operates. PROVIDED AS IS WITHOUT ANY WARRANTY, EXPRESS OR IMPLIED, INCLUDING WITHOUT ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND ANY WARRANTY OR CONDITION OF NON-INFRINGEMENT. IBM products are warranted according to the terms and conditions of the agreements under which they are provided. Statement of Good Security Practices: IT system security involves protecting systems and infor-mation through prevention, detection and response to improper access from within and outside your enterprise. Improper access can result in information being altered, destroyed, misappropriated or misused or can result in damage to or misuse of your systems, including for use in attacks on others. No IT system or product should be considered completely secure and no single product, service or security measure can be completely effective in preventing improper use or access. IBM systems, products and services are designed to be part of a lawful, comprehensive security approach, which will necessarily involve additional operational procedures, and may require other systems, products or services to be most effective. IBM DOES NOT WARRANT THAT ANY SYSTEMS, PRODUCTS OR SERVICES ARE IMMUNE FROM, OR WILL MAKE YOUR ENTERPRISE IMMUNE FROM, THE MALICIOUS OR ILLEGAL CONDUCT OF ANY PARTY. YTW03352-USEN-02

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