Employee engagement continues to be a key driving force for meeting business goals in all industries. However, even during the record-high employee engagement rates reported by Gallup in April of 2020, less than half (38%) of all employees were engaged with their work. Also, shortly after that record high, Gallup reported a record drop in engagement of 7%. This drop brought the ratio of engaged employees to slightly less than one in three (31%). There are many factors that go into employee engagement and inspiration—from manager attitudes and behaviors to career growth opportunities, job stability, work expectations, and more. Keeping employees inspired to do their best work can be a major challenge. However, it can be well worth it! As noted in research cited by Forbes, “engaged teams have lower turnover, 21% greater profitability, 17% higher productivity and 10% higher customer ratings than disengaged employees.” For sales teams, goal management can be a key driver for employee engagement. So, in today’s post, let’s discuss how you can use goal setting to inspire sales teams to go the extra mile and increase results. How to set sales goals that drive more revenue for your business When setting employee goals for sales team members to meet, it can be helpful to follow a few basic best practices: 1: Keep goal timeframes short (or break larger ones into more digestible chunks) While annual goals are important for the company as a whole to meet, pushing annual sales team goals into a sales rep’s face at the start of the year can be intimidating. For example, in another blog, when we told one of our sales reps that “his quota had almost doubled to $80,000 after last year doing $45,000 he had a minor panic attack.” This is a natural enough of a reaction to being told to do nearly twice as much as before, and the big goal was a little intimidating. However, we broke that big annual goal into much smaller and more manageable daily and weekly goals like “10 opportunities opened per week” or “40 conversations per week” that provided a short-term goal to focus on. This way, instead of worrying about a massive end-of-year goal that might feel impossible to meet, all he had to worry about were smaller weekly process and outcome goals that all contributed to keeping him on track for that big end-of-year outcome goal. 2: Benchmark sales goals against past performance An important part of the SMART (specific, measurable, achievable, relevant, and timely) goal setting framework is that a goal must be achievable for it to motivate people to work for them. But, how can you determine what is or isn’t achievable? One way to ensure that your sales team goals are achievable is to take a look at past performance and use that data as a benchmark for future performance. This can help you set goals that are aggressive, but realistic. 3: Create accurate estimates of how long sales tasks should take before setting task-based goals How long does it take for a sales team member to complete a successful prospect call? How long is the average failed call? When setting process goals for sales people that ask them to complete “X” actions in a day, the time it takes to complete the specified task can have a huge impact on whether that goal is or isn’t achievable. For example, if you set a goal of “make 20 prospect calls a day,” and each call takes half an hour on average, there is no way that a sales rep will be able to meet their goal, as that’s ten hours of calls to make in an eight-hour shift. Additionally, it’s important to leave room for some downtime between calls so the sales rep can recover mentally, take care of other tasks, and prepare for the next call. So, a goal of 12-14 calls per day might be more realistic when the average time per call is 30 minutes. This works to keep sales reps motivated so they sell more rather than give up (or try to cut corners to save some time to meet an impossible activity goal). 4: Use a goal tracking solution that provides a public data dashboard When setting goals for sales teams, it’s important to make sure that the reps on those teams know what their goals are at all times—as well as how they and their colleagues are tracking towards those goals. Public data dashboards can be an invaluable tool for accomplishing this. With a public dashboard displaying each sales rep’s key performance indicators (KPIs), you can ensure everyone knows how well they’re progressing towards their goals—and even encourage some healthy competition as salespeople try to one-up each other on the “leaderboard.” The 3 sales goals you should be tracking Which sales goals should you be tracking to encourage business growth? Here’s a brief look at the top three sales KPIs your team should be tracking: 1. Closed monthly recurring revenue (MRR) for the current month and year to date For managed service providers (MSPs) that thrive on providing consistent services from month-to-month, tracking MRR is a no-brainer. Your closed MRR will tell you how well your team is selling (and how well client services is doing at retaining customers) so you can identify trends over time. Being able to track MRR on a monthly and year-to-date basis helps you identify ebbs and flows in your sales over the course of a year—making seasonal trends clearer so you can set better goals and targets based on your company’s “busy” and “slow” periods. It can also help you determine if your company is or isn’t growing. 2. Current sales pipeline How many opportunities are in your company’s sales pipeline at any given time? Your sales team should never be without prospects to call or leads to follow up with. Your current sales pipeline is a measure of how many opportunities/leads are in your sales process at any given time—which can help you estimate the number of new customers your business can expect to gain. A closely-related statistic that may be worth tracking is sales attrition rate—the number of opportunities/leads that leave your sales process without successfully closing a deal for one reason or another. If there is a high attrition rate at a specific step of the sales process, then that could indicate an issue that needs fixing. 3. Sales activity goals A successful sales process typically involves engaging in certain activities a set number of times—such as making calls, setting up demos, and using specific sales-generating strategies. These sales process goals help to ensure that sales team members are engaging in the key activities needed to drive success and results. However, process goals alone may not be enough. Sales reps should also be held accountable to meet outcome goals—after all, anyone can make 20 calls a day if they aren’t putting in the time and effort to make a sale. With outcome-focused sales activity goals, like “sign X new customers” or “generate $6,000 in net new sales each month,” sales reps can be motivated to do more than just go through the motions. Being held accountable for results and process goals gives them a roadmap of what they need to achieve and how they can achieve it. Set and monitor the right sales goals through BrightGauge’s goal management dashboards Whether you’re tracking sales goals for a whole team or for individual sales reps, BrightGauge is here to help! We make tracking metrics like closed MRR, current sales pipeline, and sales activities quick and easy. BrightGauge’s public data dashboards let your sales reps see their numbers at a glance, letting them know which KPIs they need to focus on to meet their personal sales goals. These dashboards are also a handy tool for one-on-one meetings with employees that give managers a convenient look at an employee’s actual performance to date. Also, if the goals you need to track change because of a new initiative, BrightGauge makes it easy to modify the information displayed in the dashboard. With numerous integrations for different data sources, BrightGauge is easy to incorporate into your business. Are you ready to transform your sales team performance tracking? Reach out to the BrightGauge team today!
Talent acquisition and management is a constant challenge for any organization. Of particular concern is keeping the employees you’ve spent so much time, money, and energy recruiting and training with your company. Employee churn, employee turnover, employee attrition—whatever you call it, losing an employee you’ve spent time and other resources on building up to be part of your organization can hurt your bottom line. What is employee churn rate? What is the cost of employee turnover? How can you prevent employees from leaving? What is employee churn rate? A company’s employee churn rate is a measure of how many employees leave the company in a given period of time. This metric is often expressed as a percentage. For example, if a company has 150 employees, and 15 of them leave in a month, the employee churn rate would be 10% for that month. One of the challenges of dealing with employee turnover is that it can be variable by industry and job role. Some jobs, like working in a call center, have numerous stress factors that contribute to employee churn. The hidden costs of employee churn What is the cost of employee churn? The answer varies depending on the employee in question and other factors. Studies cited by organizations like Peoplekeep “predict that every time a business replaces a salaried employee, it costs 6 to 9 months’ salary on average.” In other words, if an employee making $90k a year decides to quit, it could cost between $45k and $60k to replace them. While the “6 to 9 months’ salary” figure might seem a little high at first glance, there are numerous costs associated with replacing an employee. In fact, for some roles, the potential impact of the hidden costs of high employee churn could be even more dramatic. Aside from direct costs like marketing a job opening, onboarding the new employee, and providing training (and pay during said training), there are also hidden costs to consider, like: Lost productivity. Unfortunately, an employee’s departure doesn’t make all of the work they were responsible for go away. In many cases, the loss of an employee, especially one with hard-to-replace skills, means a significant loss of productivity. If an employee is the only person in the organization with a particular skill or knowledge set, then all of the work they were responsible for may grind to a halt until a suitable replacement is found. Even if there are other people with similar skills, taking on the workload of a missing employee on top of their own will still result in delays. This lost productivity can have a direct negative impact on your bottom line. Lost customers. For some employees and job roles (such as sales), losing the employee could mean losing access to their list of clients or the relationships that they had built up with customers. Even with a no-compete clause, there’s always the risk of customers leaving if their preferred team members leave the company. Additionally, a new hire might make mistakes that the old employee would not have—souring the customer experience and costing the company business. Negative workplace culture. One of the potential impacts of a high employee churn rate is that it could create a hostile workplace culture—one that can impact both productivity and worker health. As noted by Quartz, “Studies find that workers who fear being laid off are less safety-conscious, more likely to get injured, and less likely to report injuries.” Employees who have issues with job insecurity (from frequent layoffs, poorly-structured stacked ranking systems, and other issues) are also more likely to engage in reckless or questionable behaviors that cause problems for the organization. High churn rates can contribute to a hostile work environment that leaves employees feeling disengaged and makes people even more likely to quit. Where the direct costs of employee turnover, such as training, marketing open positions, and onboarding employees are relatively easy to calculate, the hidden costs can be more difficult to prove without really good analytics and data. For example, one way to estimate lost productivity would be to compare the new hire’s performance against key performance indicator (KPI) benchmarks set by their predecessor. This could provide a rough idea of the lost productivity caused by the loss of the original employee. A KPI tracking tool would be ideal for this. 6 ways to avoid the costs of employee churn So, how can you avoid the costs of high employee churn? Here are a few ideas: 1. Look for common issues that may cause employee churn. The most direct way to prevent the cost of high employee turnover is to prevent said turnover in the first place. A good starting point for this process is to try to identify common factors between each of the employees that left the company. For example, did the majority of them work in the same department or have the same direct report? Were they putting in a large amount of overtime? Were their KPI goals specific, measurable, achievable, relevant, and timely? If many ex-employees have something in common, then that thing could be the cause of the high turnover rate. By identifying such issues, you can take steps to resolve them and (hopefully) prevent future employee attrition. 2. Check out what other companies in your industry are doing. What are your competitors doing to keep their employees? Are they doing anything to retain their top talents? You can check what others in your industry are doing to keep their best people then use that information to one-up them—either by offering an improved version of the same benefits or by covering gaps that they don’t address. This can help motivate employees to stay with your company. 3. Weed out the “bad eggs” fast. It may sound counterintuitive, but being able to quickly fire a bad employee can be crucial for reducing overall employee churn. Why? As noted in an article feature on Inc.com, “if someone is not carrying their weight without consequence it sends a negative message to the other employees.” Bad employees can negatively impact your corporate culture and lead to more widespread disengagement. If an employee is actively malicious towards their coworkers, then they may make good employees leave. Plus, by eliminating bad fit workers quickly, you can minimize the disruption and resource waste they cause by leaving. 4. Offer opportunities for employees to change roles or advance. One way to keep employees (and attract high-quality talent) is to focus on providing career development opportunities. Basically, this means offering to help employees learn new job skills so they can be promoted or move laterally into a new role if they want to try something different. This can help to keep employees motivated and engaged with their work. Additionally, it can reduce churn by giving employees who would otherwise leave to discover new career opportunities a chance to try something new without having to change employers. 5. Revise your recruitment and onboarding processes. How does your organization currently handle attracting new employees and getting them up to speed? Are there issues in the onboarding or recruitment process that might be giving potential hires the wrong impression about the work? Are the people being attracted through your current recruitment efforts a good fit for your company’s culture? Reviewing your current recruitment and onboarding process to make sure that it helps set the right expectations of new hires (and attracts the right people) can be critical for reducing employee turnover in the long run. After all, if you hire someone and their expectation is to work 9 to 5 as a software developer, but is expected to work 8 to 6 and do copywriting, graphic design, and business process optimization, they may quit in frustration if they weren’t prepared for the actual expectations of the job. 6. Provide ample recognition for major accomplishments It can be frustrating for employees to work hard to accomplish things, only to not receive any recognition or rewards when their efforts go above and beyond what’s expected of them. Employees who routinely exceed their goals may stop trying so hard after weeks, months, or years of not getting recognition for their results. Being able to track what employees are doing and rewarding those who exceed expectations can be an effective way to increase engagement and retain top talents—and saying “thank you” to a hard-working employee doesn’t cost a thing! This is why providing recognition is a goal management best practice. Are you ready to reduce your employee churn rate with BrightGauge? What does BrightGauge have to do with reducing employee churn in your organization? Using goal setting and management tools like BrightGauge can play a key role in your employee recognition and retention efforts! By using a KPI dashboard and tracking tool, you can easily monitor which employees are going the extra mile to deliver results. This, in turn, makes it easy to provide recognition for people who are generating genuine results. Additionally, by tracking KPIs for everyone in a given job role and taking a close look at the results, you can more easily identify goals that need revision. For example, if 98% of all sales reps in your organization are failing to meet a goal like “close 25 deals worth $10k each in a week,” then you might need to revisit that goal and make it more realistic. On the other hand, if everyone is meeting that goal with room to spare, then you might need to make it more aggressive. By accurately documenting real performance and process metrics with BrightGauge, you can show employees where they need to improve in greater detail. This can help with your performance improvement plan (PIP) creation so you can improve productivity without having to onboard a new employee from scratch. Are you ready to step up your employee retention and performance management? Reach out to the BrightGauge team today!
Tracking key performance indicators (KPIs) is a long-proven tactic for improving employee productivity. Using tools such as data dashboards, companies have motivated their employees to achieve greater results with more consistency, which has helped them with enterprise growth. Why should your organization use KPI dashboards? Which business KPIs will help with your enterprise growth? Why growing enterprises should leverage KPI dashboards Growing enterprises often have numerous business objectives that they need to track—and not a lot of time to manually manage that data! KPI data dashboards help to simplify tracking and managing employee KPIs and business KPIs so leaders can check performance with a glance. Instead of having to dig through several separate reports to track all of an employee’s or business unit’s performance metrics, leaders can simply take a look at a data dashboard to get the most relevant and important information in seconds. This information is also easy to collect for reports to key stakeholders who may need it. With easy access to performance data, enterprises can identify trends (both positive and negative) and make changes to account for them. For example, if employees are struggling to meet a particular performance goal, it may be necessary to provide coaching to ensure employees have the skills they need to perform. What business KPIs should you track to boost enterprise growth? Many business owners, leaders, and stakeholders want to know which business KPIs they should track to improve their enterprise growth. The problem is that there is no true “one size fits all” solution when it comes to KPI tracking. Different enterprises will need to track different things to achieve the best growth results. It takes an understanding of your business’ objectives and industry to determine the best KPI dashboards to use in your organization. Additionally, the KPIs you track for one business unit might not be a good fit for others in your company. Here are a few KPI examples to consider when choosing performance metrics to track in your organization: Project KPIs These are KPIs specific to a particular project that is going on. Two important project KPIs to consider include: Billable project hours. A measure of how many hours are spent on a given project in a set time frame. Managed service providers (MSPs) may use this metric to determine if they’re over-billing for a project (potentially indicating that they under-scoped the project). Overbudget projects. How many projects are currently over-budget? This metric can help provide an assessment of how well the company is managing its budget for projects and create early indications of issues that may cause the balance book to go into the red. Customer service KPIs KPIs related to how customers are being serviced. Customer service KPIs can help MSPs and other organizations determine if they’re meeting their service level agreements (SLAs) or if they need to make changes. Some customer service KPI examples include: Time to resolution. How long it takes for a service ticket or customer call to be resolved. This is often used to measure employee performance. Tickets/Cases closed each day. How many client/customer calls or tickets are resolved in a day? Measuring this can help identify potential problems with resolving customer service cases in the enterprise that need resolution. Customer complaint rate. The number of customers who have reached out to make a complaint about a product or service received versus the total number of customers. High complaint rates may indicate a major issue with a given product or service (or how it’s marketed) that needs to be fixed. Financial KPIs Every enterprise needs to carefully track and manage its financial performance data. Having the right financial KPIs can help business leaders anticipate their expenses, avoid potential over- and under-budgeting for key initiatives, and set expectations. Some financial KPIs to track for enterprise growth include: Past due receivables amount. Also called “accounts receivable,” the past due amount is an important metric to track so you can know how much payment to expect from clients. Tracking which accounts are past due is also important for reconciling payments with your clients. Earnings before interest, taxes, depreciation, and amortization (EBITDA). This metric is useful for determining your organization’s financial health. Numerous companies have used this metric to determine employee bonuses for the year. Gross margin per client. A measure of your company’s total revenue minus its direct costs (licenses, software, etc.) and fully loaded labor cost, which is then divided by total revenue to generate the gross margin percentage. Here’s the formula: (Total revenue – direct costs – fully loaded labor costs) / total revenue = gross profit margin. Marketing KPIs Marketing is an important activity for making sure your enterprise’s brand gets in front of potential clients/customers. Marketing KPIs help enterprises establish the ROI of their marketing efforts, determine what is and isn’t working for their marketing, and identify issues that might be causing potential customers to leave the sales funnel. Some marketing KPI examples to track include: Cost per lead. A measure of how much money is spent on marketing to generate a single lead. Calculated by dividing total marketing spend by the number of leads generated. Customer lifetime value. A measure of how much a single customer is worth to your company over their lifetime. Useful for determining how much should be spent on marketing for each customer. Email deliverability. This is the number of emails sent successfully versus those that fail to be delivered or get sent to the spam folder. Failed deliveries can negatively impact your enterprise’s ability to send emails in the future, so this is an important metric for marketing leads to know. Drive enterprise growth with BrightGauge’s comprehensive KPI dashboards While the KPI example list shown above is far from comprehensive, it should provide a rough idea of how many different KPIs there are for companies to track. How can you track so many disparate business KPIs? BrightGauge’s KPI dashboards are one way to track numerous metrics at a glance! With BrightGauge, you can easily customize a data dashboard to present the most important metrics for your business unit or your company as a whole. Instead of digging through a dozen different data sources and apps, you can have BrightGauge collect everything you need to know into a single-pane view that is easy to parse. Are you ready to get the data you need to fuel your enterprise’s growth? Reach out to the BrightGauge team today!