Executive Management

Senior executives want to know that sales priorities are being set effectively and that the sales pipeline is being efficiently managed. Summarized and trended views of the sales pipeline is the starting point. A good and hopefully growing proportion of opportunities should be found in later, close-to-closing stages. Over a time horizon, for example by quarter for the past 5 quarters, can reveal whether the trend is changing in a positive or negative manner.

Similarly, pipeline velocity is vital for driving more revenue through your sales pipeline. Analyzing your pipeline should show a healthy number of opportunities that are relatively "young" and that the "older" opportunities are clustered in the later stages. Reviewing aging over a number of quarters helps you clearly understand your sales cycle, how it might be changing, and can also lead to changes in marketing or sales strategies that will increase your pipeline velocity.

Looking at the trend in this metric is a valuable management exercise. If this ratio is increasing, understanding whether it is due to recent jump in orders or is due to difficulty in the fulfillment process (hampering the booking of your backlog as revenue in a timely fashion) is an important financial insight.

Yield is the ratio of closed sales to number of prospects being tracked in your sales pipeline. A weakening sales yield signifies falling close rates or can indicate pursuit of poor quality sales prospects (for example, poor prospects may emanate from weak or deteriorating lead generation programs) – either of which signify sales and marketing issues that will harm your revenue and profitability growth if not corrected quickly.

The growth potential of your business is directly related to increasing the customer-perceived value of what you are selling. Reviewing sales order prices over time gives valuable insights about trends in your customers' perception of your value, which reps or channels have positive or negative trends, where effective or ineffective cross or up-selling is occurring.

Evaluating your sales wins by attributes such as customer type, industry, product, revenue size, or profitability can yield powerful insights about sales performance. For executive management, it is also an important means to understand why sales forecasts might be deteriorating and lead to refinements to current forecasts based on results of periodic win / loss analysis.

For many companies the front-end of the sales funnel is often more like a “sales sieve” as marketing dollars are wasted on lead generation activities that don’t have a direct correlation to closed business. Lead generation powers your pipeline. Identifying the sources for lead that are most effectively driving high quality pipeline opportunities will ensure that the best performers get necessary investment and top priority. Decipher provides wins, losses and yield information for different lead sources to guide you in making that decision.

Even though often challenging to assemble the correct data required to perform profitability analytics, the payback from such an effort is usually significant. Metrics that measure order quantities and revenue are important, but decisions based on sales results can be greatly improved by the addition of profitability analytics by product, sales rep, region, or channel.