How top performers outpace peers in sales productivity

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Productivity has always been top-of-mind for sales and the need for efficient growth is even more acute now. Competitors are upping the stakes as well. McKinsey analysis of nearly 500 B2B companies across industries has found that those in the top quartile are significantly outpacing their peers in productivity—generating roughly two-and-a-half times higher gross margin than the bottom quartile for every dollar they are investing in sales (Exhibit 1).

Profitable growth of this magnitude is transformative—and disruptive. Our experience shows that the capability gap between leaders and laggards is not only large, but also growing, as leaders build on the foundations they’ve laid to scale productivity further.

Sales organizations know they have to be more calibrated in how they work and more exacting in squeezing out value. But with dozens of initiatives clamoring for attention and heightened investment scrutiny, some have struggled to know where to place their focus.

For the answer, we looked at the practices that set outperforming B2B sales organizations apart—what they do differently and what capabilities they are prioritizing. The results point to three areas: they free up seller time for customer-facing activities, they prioritize the most valuable opportunities, and they do a better job developing high-performing talent. Here’s how leaders are driving higher productivity and what others can begin doing now.

Leaders generate about 2.6 times the sales ROI of laggards.

Radically offload and automate non-sales activities

Despite widespread availability of sales, marketing, and automation technologies, non-selling activities still consume two-thirds of the average sales team’s time. Leading B2B companies have put their foot down on such inefficiencies. While underperforming organizations weigh whether to set up shared services centers, leaders have already offloaded as much as 50 percent of non-selling tasks to these groups and are now automating aggressively within these centers and across the rest of the sales organization—a leap that has opened up 20 percent more sales team capacity (Exhibit 2). Shared services structures and automation have helped top-quartile companies shave significant costs and improve sales productivity by as much as 30 percent.

Automation can free up about 20 percent of a sales team’s capacity.

With automation underway, leaders are looking to gain additional productivity boosts by layering in AI capabilities, such as smart workflows and generative AI (gen AI), many of which are now commercially available. For example, gen AI can analyze customer data to identify leads, score them based on their conversion and value potential, and deliver hyper-personalized outreach tailored to specific journey stages, including real-time negotiation guidance.

Leaders further realize that they need to focus on the seller experience. Instead of toggling between systems as many reps are obliged to do today, top-performing organizations integrate customer data and analytics into a single pane of glass and they work with sellers to ensure account and deal-level insights are presented in user-friendly ways. These efforts have increased seller adoption, which in turn has improved productivity, conversion, and sales.

Many of these leading businesses didn’t start “great.” Rather, they started with simple steps and refined rapidly from there. Robotic process automation (RPA) is one of those basics. A B2B company in the sound technology space cut order entry processing times from three hours to three minutes using RPA, leading to 30 percent more customer-facing time and a 20 percent potential lift in sales. Automatic lead enrichment is another proven value generator. These tools link data from multiple sources and allow companies to layer analytics on top, sparing sellers the hassle of chasing down leads and making sense of different inputs.

Ruthlessly focus on the most valuable opportunities

Underperforming B2B sales teams spend a disproportionate amount of their time—more than 50 percent in some cases—serving customers that contribute 20 percent or less to the company’s revenues. But top performers flip that equation. They invest in advanced technology stacks, analytics, and prescriptive insights and ensure that the most intensive sales engagement is preserved for high-value accounts—lowering cost-to-serve by an average of 10 to 20 percent, and increasing revenue per sales FTE by an average of 3 to 15 percent.

They prioritize accounts by spend and growth potential, enriching their in-house analyses with third-party data to refine segmentation and define next-best-action opportunities. An agricultural chemicals producer, for example, built a datamart that could aggregate traditional data with newer sets such as geospatial information and web-scraping analytics. Richer data helped it detect variables with greater predictive power. This helped it create more powerful metrics, identify growers with a higher propensity to buy and estimate potential spend, leading to a 2 percent increase in sales.

Leaders also turn the analytics lens on themselves, using calendar, email, and other activity data to assess where reps are spending their time, so they can realign account coverage and address missed opportunities. Those insights can help with alignment, flagging areas where reps may be spending too much or too little time relative to the size of the opportunity. A life carrier, for example, created a sales steering tool that funnels data on the highest-value opportunities and compares them against current seller time commitments. Teams use the tool in sales meetings to pinpoint which customers to contact with what offer and messaging. Support teams work alongside preparing pitch decks and materials so sellers can be up and running quickly.

Having a clear expectation for where future growth will come—and where not—helps leaders deprioritize their long tail opportunities and find ways to serve these slower growth accounts more efficiently. Often, these clients are smaller companies with less complex needs that can be met through self-service digital channels or through remote engagement with inside sales, and, in some cases, by engaging with distributors. Service levels such as shipping options and minimum order quantities should also be adjusted to different account types and hardwired into IT systems.

Cultivate and motivate high-performing talent

Sellers are the productivity engine of any sales organization, and top-performing companies set them up for success—fine-tuning skills development and sales steering and tying incentives to specific seller targets.

These leaders invest time up front, identifying the specific skills correlated with high performance in each channel and role. Then they differentiate learning journeys, employing self-paced and asynchronous training so that sellers can acquire the content they need, skip content they don’t, and access it when it suits their schedules. One telco, for instance, designed five new channel-specific learning journeys and rolled them out to roughly 1,000 sellers. The journeys were anchored on 15 skills that the company’s analytics showed led to above-average customer productivity. To encourage engagement, the company created a certification program for direct sellers and external agents that included gamified components and financial and non-financial rewards. The training proved wildly popular—achieving an average net promoter score of 60 and a 10 percent increase in deal size per rep.

Performance steering is equally targeted—instead of conventional KPIs, top-quartile B2B sales organizations are more likely to create business-specific guidance to focus and direct seller activities. Examples include dynamic, real-time customer insights, pricing recommendation engines, and systems to predict and prevent customer churn. And rather than simply providing this information passively to sellers, they’re using it in daily or weekly huddles to simulate actual customer conversations, problem solve issues collaboratively, and discuss the best ways to support specific sales actions.

B2B leaders are also reconstituting incentive schemes, breaking away from the quota-driven models of the past, and aligning incentives dynamically in response to strategic priorities. Anticipating a possible recession, for example, a B2B services company created a prediction model to gauge which customers were most at risk of churn. They then incentivized sales reps to engage proactively with these accounts, linking upward of 20 percent of their bonus payout to success in lowering account churn risk below a predefined threshold. The new scheme cut customer attrition by 5 percent.

Steps to start the journey to excellence

Operational changes can feel scary. But sales organizations must take concerted steps now to ratchet up their productivity. Top-performing companies aren’t just becoming steadily more productive, they are using the time and cost savings generated by current improvements to become exponentially more effective. The good news is that the practices that catapulted these businesses to the top can be replicated—and many of their formulas don’t require a year’s long transformation. Here are some initial steps to start that journey:

  • Cut the three most wasteful non-customer-facing tasks and redirect these to a sales support function: If a formal shared services center does not exist, create one for each core region, and plan to shift 50 percent or more of sales support activities to these groups within a year.
  • Overhaul and automate sales tasks, starting with the most critical mission: Develop a road map to automate 20 percent of core sales processes over the next 12 months. Add teeth to these plans and hold leaders accountable for delivering specific ROI gains from this work.
  • Embrace a remote-first model for the long tail: Commit to moving 25 percent of low-growth customers—those likely to contribute less than 10 percent in annual revenues—to inside and digital sales channels within a year.
  • Introduce rigid performance management: Establish a weekly steering cadence to align sales team activities with high-value opportunities and ruthlessly de-prioritize lower-value engagement.
  • Establish a systematic approach to sales capability building: Use sales and pipeline analysis to surface the knowledge and capabilities that teams will need to master over the next 12 to 18 months. Channel learning and coaching toward those areas and pull back on non-essential training.
  • Designate a small team to drive productivity improvements: Give them technology funding, run sprints every three months, and track productivity KPIs on a monthly basis.

Peter Drucker once said, “Until we can manage time, we can manage nothing else.” Sales leaders that make this their guiding principle can make 2023 a year of transformational gains.

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