Your C-suite stakeholders just asked for a rundown on sales performance for the quarter to date (and comparatively year-over-year). The only issue? Lately, you’ve been laser-focused on monitoring the total number of prospects in the pipeline, but this metric doesn’t paint the whole picture of sales performance.

A holistic view of sales performance requires piecing together data from several different places (CRM, ERP, SPM/ICM, Sales Tools, etc.), and many organizations struggle with the data consolidation or creating this clean source of truth.  

Moreover, with so many variables, it's difficult to know what's actually influencing different outcomes.

Sales performance indicators (SPIs) help combat this. They align all key stakeholders on the most important metrics. These data points tie back to overarching goals and tracked religiously in your ICM or SPM solution.  

SPIs allow stakeholders to get a confident answer to “What is actually driving positive or negative performance” as it relates to their objectives, while you get an accurate method of measuring performance and identifying areas for improvement.  

Below we share key performance indicators examples (and even some KPIs) for sales team's to report on, with tips on how to define the right metrics and track performance from the outset.

But before we dive in, first...

What are sales performance indicators?

Sales performance indicators (SPIs) are metrics measuring sales performance focused on the productivity, progress, and activity of your sales team as they work toward specific targets. You can think of them like leading indicators precluding revenue. They're the metrics that give you an indication of how likely you are to get the revenue
  

While SPIs and Key Performance Indicators (KPIs) are both used to measure success, they serve distinct purposes and operate at different levels of performance evaluation. The distinction between these two is admittedly a bit of a grey area, but here's how we think of it.

SPIs tend to be more granular, operational, and immediate in nature, often offering a real-time or near-term snapshot of how effectively your team is performing. An SPI example might include average deal cycle length, or pipeline coverage ratio.

KPIs, on the other hand, are even higher-level, strategic metrics that track success against overarching business objectives. KPIs provide a broader view of outcomes and results, such as revenue growth, sales quota attainment, customer acquisition cost (CAC), or win rates. They help leaders determine whether strategic goals are being met over a set period of time. An example of a KPI might be something like a quarterly revenue target, the annual growth rate, or net new customers acquired.

SPIs and KPIs differ when it comes to scope, timeframe, and use cases.

• I.e. SPIs typically measure progress and activities driving performance. They focus on short-term and real-time performance (think daily, weekly, monthly), and aim to highlight the root cause of a particular outcome.

You can think of SPIs and KPIs as complementary: SPIs feed into KPIs. By monitoring SPIs, sales leaders can identify early warning signs of performance issues, take corrective action, and ultimately influence KPI outcomes. Think of SPIs as the drivers that contribute to achieving your KPIs—small changes in SPIs (like increasing call volume) can significantly impact KPIs (like revenue growth).

In short:

• SPIs measure the journey (activity and progress).

• KPIs measure the destination (results and success).  

All the same, SPIs are a crucial part of sales management because they:

• Improve sales forecasting accuracy in sales planning (you can spot productivity trends across individuals and teams)

• Help optimize sales processes and workflows to operate as productively as possible (bottlenecks in the sales process will become apparent)

• Support training and development by identifying skills gaps

• Encourage accountability and transparency  

• Assist in adapting to market changes

Notably, SPIs can vary dramatically across industries

Sales leaders at B2B SaaS organizations, for example, work with longer sales cycles that involve multiple decision makers and span several months. The focus tends to be on retention through subscription revenue, so they’d focus on SPIs like monthly recurring revenue, product demos offered, and churn rate.

A retailer selling products to the general public, however, has a much shorter sales cycle with a focus on high volume. Sales performance might be judged on SPIs such as sales per square foot, sell-through rate, and average order value.

The 2 categories of key sales performance indicators to track

Again, SPIs are leading indicators, and we break them down into these two overarching buckets:

• Activity-based SPIs, and  

• Efficiency & pipeline-health SPIs  

We get into each with some examples below.

1. Activity-based SPIs

Activity-based metrics measure the effort and actions that your sales reps put in—even if they don’t result in a sale. They’re most commonly used in industries where sales cycles are lengthy and complex.  

A B2B enterprise brand that sells high ticket subscriptions, for example, might monitor sales performance based on SPIs such as:

• Number of outbound calls/emails per rep

• Number of meetings booked

• Product demos offered

• Number of demos conducted (or customer meeting completion rate (percentage of scheduled meetings that happen)

• Proposals delivered

• Follow-up rate (percentage of leads followed up on within a set timeframe)

• Touchpoints per opportunity (average number of calls, emails, or meetings per deal)

• Proposal-to-close rate (percentage of proposals leading to a deal)

What’s great about activity-based metrics is that they allow you to evaluate each stage of the sales process. If a rep is great at booking calls but not scheduling product demos, for example, it could suggest a problem with their call script or the sales positioning/messaging. Consider specialized sales coaching or training to refine their approach.

Activity-based metrics can also instill motivation in your reps—particularly if SPIs are tied towards specific incentives. You can drive desired behaviors by offering a reward for completing the action. It’s no wonder why studies show that adding even modest activity-based incentives on top of existing incentives could increase sales productivity by up to 9%.

2. Efficiency & pipeline-health SPIs

Sales efficiency and pipeline metrics are the second category of SPI you can use to measure how well your team uses its resources to meet a goal (usually revenue). They’re ideal when forecasting revenue for sales and operations planning (S&OP) because efficiency metrics allow you to monitor how your supply is being used to meet demand.

Examples of pipeline health SPIs used to assess the strength and coverage of your sales pipeline include:

• Pipeline coverage ratio (total pipeline value compared to quota; e.g., 3x pipeline coverage)

• Number of opportunities created

• Opportunity conversion rate (percentage of leads converting to opportunities)

• Pipeline velocity or deal progression rate (the speed at which deals move through the pipeline re: percentage of deals moving from one stage to the next)

Some examples of sales efficiency metrics include:

• Average sales cycle length (time from first contact to deal closure)

• Average deal size

• Lead-to-opportunity conversion rate (or time spent in each stage of the pipeline)

• Cost of sales

• Sales rep time allocation (i.e. Sales productivity per hour/day/week (e.g., revenue generated per time unit)

As a subset, some individual performance SPIs in this category include:

• Activities per deal closed (number of interactions leading to a successful close)

How you might use individual performance SPIs

Sales leaders who look at metrics like sales rep time allocation typically use it to identify where reps are spending their time as a larger way to view performance. Often, non-revenue-generating tasks, such as logging data or coordinating meetings, can take up the bulk of their time. (This is not uncommon: research estimates a rep spends around 40% of their week on non-selling tasks.)

Hypothetically, if your S&OP were to indicate demand would increase over the coming quarter, instead of expanding your headcount or offering higher commission to incentivize performance, you'd want to implement technology to automate administrative-style tasks and maximize existing people resources. This is where an efficiency metric like the ones above can be most helpful in pivoting your approach.

Additional, outcome-based KPIs to track

Along with the SPIs above, you'll likely want to measure a handful of critical outcome- based key performance indicators over set periods of time. Here's an overview of this classification...

Outcome-based KPIs

Typically, outcome-based metrics help you track whether your reps have achieved a particular outcome. They work similarly to activity-based metrics—the difference being that outcome-based metrics tell you the result of a given behavior.

Outcome-based metrics help measure how your team is performing relative to their (often) revenue-based targets. It also helps monitor how activities such as incentives, new sales training methods, and software implementation impacts rep performance.  

The first set of outcome based KPI examples is rooted in pipeline. These include:

• Win rate = closed deals / total opportunities

• Quota attainment = (actual sales / quota) x 100

• Deal closure rate = (opportunities / number of deals closed) x 100

• Quota attainment per rep

• Average revenue per rep

• Close rate per rep (percentage of opportunities closed by a salesperson)

All of the above have to do with your pipeline universe in some fashion.  

From there, you have a further set of KPIs rooted in the nature of your transactions. I.e. did you sell to a net new customer, was it a renewal, or an upsell. These examples include:

• Customer retention rate (percentage of customers retained over a specific period)

• Upsell/cross-sell rate (success in expanding deals with existing customers)

• Customer satisfaction score (CSAT) for sales engagements

Incentive compensation plans have a very strong/directional impact on these KPIs, since quotas are often set according to one of the three. If there are issues in any one of them, a reevaluation of the incentive plan may be worthwhile.

As an example, let's look at quota attainment.  

Say a large tech company has a goal to increase market share in the U.S. With their defined sales quotas—each rep is expected to bring in $50,000 of new business over the coming quarter. They must hit this target to become eligible for on-target earnings, extra commissions, or bonuses.

However, when examining historical data from your sales performance management (SPM) solution in a bimodal distribution, you notice some reps fail to hit even 30% of quota, while others exceed 140% quota attainment. Unfair quotas are clearly a problem here, so you dig deeper to find out why, only to discover that:

• Experienced and newly graduated reps were issued the same quotas.

• Hunters and farmers have the same quotas, despite having different goals (Unfortunately your farmers’ performance indicator is wrongly tied to a behavior they don’t prioritize: finding new business)

Further, you discover your existing quotas aren’t balanced to territories—reps in lucrative territories have higher quota attainment because new business is easier to close there.

Overall, this is an example of one KPI like quota attainment or deal-closure rate leading to an inspection of your sales team performance, and how you'd need to adjust your incentive plan accordingly (adjusting your quotas, territories, and overall sales incentives to match).

‍How to measure and track sales performance indicators

Now we know what your sales performance indicators might look like, here are bonus tips on how to measure and track your most important SPIs.

Define the right SPIs (and don't try to track too many at once)

Ever heard the phrase “Too many cooks spoil the broth”? A similar concept applies with SPIs. Going overboard and choosing to track 20 different metrics leads to a lack of clarity. While we've listed many examples of SPIs to choose your heartbeat metrics from, you will need to select the ones most relevant to your business.  

When choosing SPIs to track, focus on aligning them with your sales strategy, team goals, and business objectives. Start by identifying the specific behaviors, activities, and milestones that directly impact your key outcomes—whether it’s boosting productivity, accelerating pipeline velocity, or improving win rates.  

When reps aren’t clear on how their performance is measured--or which metrics matter most motivation and performance suffer. Further, leadership gets overwhelmed with figures that don’t translate to the overarching goals of the business.

Instead, work with leadership to identify organizational goals, and choose SPIs that align with these for a consistent business narrative.

• If you’re growing your customer base, for example, you might prioritize metrics like conversion rate or revenue from net new customers vs. upsells/renewals.  

• If your goal is to improve efficiency and maximize value from existing resources, perhaps consider efficiency metrics like revenue per sales rep.

You'll also want to balance your SPIs between individual performance, team activity, and pipeline health to gain a holistic view of sales effectiveness. Regularly review and refine these metrics to ensure they're aligned with evolving business goals.

Employ the right tools

Long gone are the days of tracking sales performance in a spreadsheet. Technology can do the job for you—which can save hours each week while also improving data accuracy. Popular tools include:

CRMs: Platforms like Salesforce and HubSpot let sales teams track customer interactions, activities, and outcomes. They’re especially useful to track activity- and outcome-based metrics such as calls made, win rate, and deals closed.

Sales dashboards: Increase visibility on your SPIs with real-time sales dashboards that show progress towards your goals. This instills accountability and lets reps course-correct if they’re falling short before their OTE is impacted.

SPM software: Credit the right sales rep for each transaction, calculate OTE, and test changes to incentive pay plans that impact SPIs (before an official rollout) using a full-stack SPM solution like Forma.ai.

Enterprise resource planning (ERP) systems. Software like Oracle Netsuite and Microsoft Dynamics 365 pull data from various sources (finance, supply chain, SPM, and HR tools) to give a centralized view of business operations. For example, you can compare sales data against financial reports to subtract any reversed or refunded transactions from SPIs such as conversion rate for a more accurate view of sales performance.

Segment your data

Segmentation takes a more granular approach to data analysis. Instead of looking at your sales performance data all lumped together, you could divide it to analyze how SPIs differ depending on factors such as:

• Individual rep

• Territory plan  

• Lead source

• Product or service

• Customer type (new vs. existing)

• Deal size

For example, segmenting SPM data by individual sales representatives or teams can reveal which are excelling and which need further training. For the latter: you could implement performance-based incentives, such as spiffs, or offer personalized coaching to help underperforming reps improve. Both approaches allow you to maximize resources and improve sales productivity without expanding your headcount.

Similarly, you could segment sales performance data by customer type (e.g. small business, midmarket, and enterprise clients) to understand how the sales cycle differs between each ICP. If you notice that small businesses have an average deal size of $2,500 but it takes just four weeks to close the deal, on average, they might prove more fruitful than enterprise clients who bring in more money but take longer to close.

Compare SPIs against industry benchmarks

Industry benchmarks serve as a useful yardstick to measure whether your performance is on par (or exceeding) the competition. It happens when you compare SPIs from organizations most similar to your own. If you’re a scrappy startup that’s new to the market, it wouldn’t make sense to benchmark SPIs against enterprise brands with 100+ strong sales teams.  

Knowing where your team stands relative to other sales organizations in your industry helps you set targets that push performance without being overly optimistic or unrealistic. For example, if you know that the industry’s average deal size is $20K but your team is stuck at $13K, consider upping their quota and offering more attractive compensation packages once they edge closer to the $20K benchmark.  

Free templates for SPI tracking

If budget is a restricting factor to start tracking SPIs in your organization, here are some of the best templates we could find for SPI tracking:

Smartsheet’s KPI tracking templates: Plug data into these Excel templates to visualize your sales performance indicators. They’re ideal to present to leadership—colorful graphs and charts make the data easy to digest.

Copper’s sales pipeline report template: Demonstrate the value of sales to stakeholders with this template that visualizes your sales pipeline using key SPIs.  

Pipedrive’s sales employee review templates: SPIs help you spot underperforming or overperforming. Regardless of where on the scale each individual rep lands, conduct a performance review with this free template.

HubSpot’s sales conversion and close rate calculator: Visualize where leads drop off, and calculate your sales conversion rate, with this free calculator. You can also define your monthly and quarterly sales goals and track performance trends over a longer duration inside the spreadsheet.