Last week’s blog introduced the SRP Matrix and defined its
two axes: levels of sales process
implementation and levels of relationship.
With this foundation in place, this week we look at what the relative
performance is of various matrix tiers.
The past three years we’ve segmented the matrix based on data gathered
in our SPO survey. The metrics we used
to do this were: percentage of annual
revenue plan attained; percentage of reps meeting/beating quota; sales rep
turnover; and forecast accuracy (won/lost/no decision).
Based upon the survey data, the various matrix cells fell
into three performance levels (see Figure 1).
It’s worth noting that two cells represent what we call “no
fly” zones: Random Process-Trusted
Partner and Dynamic Process-Approved Vendor.
Although individual reps may be able to operate at these extremes, we
don’t find a representative sample of companies doing so. It seems that to reach (or by reaching)
Trusted Partner level, some amount of process needs to be in place. Similarly, firms that reach the Dynamic level
of process implementation generate enough “lift” to become at least Preferred
Originally we labeled the Red zone: Sleepless Nights; the Yellow zone: Challenging Months; and the Green zone: Successful Years. These titles reflected both the improved
performance moving up and over on the grid and also the increased
predictability that accompanied this movement.
However, the challenges of 2009 showed that even the Yellow
and Green were not immune to economic times and tides. As a result, this year we’ve renamed the
three zones Performance Levels 1, 2, and 3.
As you can see, less than a quarter of firms made it to Performance
Level 3 this year (Performance Level 1 gained a point from each of the other
two levels, up from 29% the prior year.)
The question needing to be answered, of course, is does any of this make a difference? In past years it has and 2009 it did as
well. To be sure, even Level 3 companies
were impacted. Revenue attainment was
down from 92% (2008) to 84% (2009), and percentage of reps meeting/exceeding
quota was similarly down from 65% to 60%.
Still, these levels exceeded Levels 1 and 2 each year. [For a complete discussion of this check out
2010SPO Key Trends & Analysis.]
More interesting is to see that moving up a level from one
year to the next would have enabled companies to essentially hold their own
rather than getting swept back (see Tables 1 and 2).
The data show that even in tough times, elevating your level
of relationship and/or level of process implementation will pay off. A worthwhile exercise is to assess what cell
your sales team is in today, and where you would like it to be six months from
now. Then determine a couple key
initiatives to move you in that direction.
[Hint: moving over is easier than moving up]]