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- A Chally Focus Article -

Sales Productivity Benchmarking

As a sales leader, you're laser-focused on achieving results. But how can you chart your sales team's direction if you don't know where you stand — right this minute? We're not talking about rosy projections or pie-in-the-sky spreadsheets — we mean cold, hard numbers that you can use to energize your sales planning process.

The Alexander Group's 2002 Sales Coverage Benchmarking Initiative and Forum

Here's a resource that might be just what you need! The 2002 Benchmarking Initiative is sponsored by The Alexander Group (AGI), The Columbia Business School, and Sales and Marketing Magazine. So far, it includes over 700 sales and marketing executives from Fortune 500 and Fortune 1000 firms. AGI expects 1000 participants by September and will continue to run the Initiative annually. Participants have come from 11 different industry categories, have been 62% Director or above, and have an average revenue of $640 million.

Each participant in the Initiative has shared data around their revenue and cost objectives & performance for both 2001 and 2002. They have also shared info on their mix of revenue (i.e., by new products, new customers, indirect channels), on quota directions, and most interestingly on which strategic sales initiatives (SSIs) they are implementing (and which are actually helping increase productivity and which are not). Overall, there are fifteen SSIs for which AGI is collecting info, including such strategies as deploying product specialists, launching new inside sales or indirect partner channels, and changing crediting and/or compensation policies.

The results show that leading sales organizations have surprisingly aggressive growth and cost reduction ambitions for 2002 and 2003. It also shows that sales executives are trying to realize these objectives through a range of SSIs designed to enhance sales productivity. In this market, these executives are basically betting their careers on the successful choice and execution of the "right" SSIs. However, as the benchmarking findings make clear, the choice of the "right" strategic sales initiatives varies enormously by such variables as growth and profitability objectives, company performance, industry, reliance on channels, new product focus, last year's strategies, etc.

Leveraging the 2002 Sales Coverage Benchmarking Initiative

Top line observations from the 2002 Sales Coverage Benchmarking Initiative offer a complex picture for 2002/2003 that includes both aggressive growth and cost reduction ambitions based on strategic sales initiatives designed to enhance sales productivity. Some of the findings so far include:

  1. The benchmarking participants as a group have an ambitious Vision for market success in 2002 (i.e., the median 2002 planned revenue growth rate for all participants is 11%).
  2. Revenue growth expectations are high, across most industries, and these planned growth rates would be a large improvement over 2001 results (i.e., 8 percentage points higher on average than their 2001 actual growth rates).
  3. Companies also have an ambitious vision for cost reduction, with most planning significant reductions.
  4. To achieve their objectives, participants have developed growth Blueprints that combine increased sales productivity, new customer penetration, and new product revenue (i.e., roughly 40% participants plan to obtain at least 20% of 2002 revenue from the difficult selling challenges of either new customers or new products).
  5. To execute their revenue growth blueprints, participants are leveraging a Toolkit of strategic sales initiatives (SSIs) to improve sales effectiveness.
  6. Only certain sales strategies will be targeted for investment in 2002 - 2003...those that have been proven to work (i.e., for some sales strategies, up to 30% users said there was no benefit, and for other sales strategies up to 15% said there was actually a negative impact).
  7. Investments that companies will make in sales strategies will vary significantly depending upon the nature of their objectives (growth vs. cost containment) and the current strength of their business.

Figure 1 - Revenue Growth Was Anemic in 2001

Figure 2 - The Most Valued Initiatives Used to Fight Back

You can join the Initiative by participating in the survey. It is designed to be quick and hassle-free for busy, senior sales executives. To this end, it is Web-based with all drop-down answers, and has an average completion time of only 11 minutes.

Participants in the Initiative will receive a detailed survey report, and are also eligible for Special Cuts of the survey database, Peer Roundtables focused on particular challenges and strategies, Webcasts highlighting key findings, and the Sales Executive Forum. The forum will be a three-day event at "The Breakers" in Palm Beach Florida, from October 13-15, 2002, with featured sales executive speakers from IBM, Cisco, FedEx, and Monster.com.

To learn more about the 2002 Sales Coverage Benchmarking Initiative, click here: use this link:
http://www.alexandergroupinc.com/surveys/survey.asp

To participate in the on-line survey (11 minutes) and join the 2002 Sales Coverage Benchmarking Initiative, use this link: http://tools.saleslobby.com/SalesStrategySurvey/default.asp