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Sales Performance Management—Effectiveness And Efficiency

by David Brock on April 11th, 2012

As sales professionals and sales leaders, we are constantly focused on achieving the highest levels of performance.  We have to constantly improve–performance that was outstanding five years ago is deficient now.  What is outstanding today will become uncompetitive in the future.

Implementing performance improvement initiatives, continuing to improve and innovate is very difficult.  Sometimes, in looking at sales performance improvement, it’s important to break it into a couple of components:

  • Are we being as effective as possible?
  • Are we being as efficient as possible?

Sales effectiveness generally focuses on are we doing thing in the best possible way?  Are we doing things right?  We look at things like our sales process–is our sales process maximizing our ability to connect with our customers, to create value in their buying process and to maximize our ability to win?  Or we may look at our account/territory strategies—are we maximizing our contribution to the customer(s), are we aligned with their goals, helping them to achieve them, are we maximizing our share within the account or territory, are we identifying and pursuing every opportunity and maximizing our ability to win them?

Sales efficiency has a slightly different focus than sales effectiveness.  Typically it focuses on speed, time, resource.  Are we achieving our goals in the shortest time possible?  Can we reduce the time or resource required to execute our strategies and goals?  Can we reduce or compress sales cycles?

Effectiveness and efficiency go hand in hand when we are looking to achieve the highest levels of sales performance.  Doing things right–but at the wrong tempo doesn’t allow us to perform as well as possible.  Executing bad  processes in the shortest time possible doesn’t improve performance.

But sometimes, it’s very difficult to achieve both simultaneously.  Too often I see performance improvement initiatives fail because people are trying to change too many things at the same time.  People generally have the capacity to focus and execute 1-3 things very well, the more we pile on, the more difficult it is to excel.  People get confused, priorities are blurry, understanding what works and what doesn’t is impossible.

Often, it’s important to separate the performance improvement initiatives, focusing first on one area of improvement, then the next, then the next…..  Ideally, taking small, but very rapid steps.

As we look at sales effectiveness and efficiency initiatives, generally we have the greatest impact in performance improvement by focusing first on effectiveness—doing things right.  For example, making sure people understand the sales process and are executing it well–improving their deal strategies, creating great value with the customer, maximizing our ability to win.

As we as individuals or as our teams start maximizing their effectiveness or impact, then we can start working on efficiency–how to we achieve the same goals more quickly, how do we achieve the same outcomes with a smaller resource investment?

If you are struggling in making your sales performance improvement initiatives work, consider separating them–focus first on effectiveness, then focus on efficiency.  You’ll find you are accomplishing much more–faster.

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  1. Great post as usual, David. I don’t have anything of value to add, just have to get a thought out that’s been floating around in my mind for a while: In Swedish efficiency and effectiveness is the same single word “effektivitet”.

    I wonder how that affect our approach to things as I frequently see these being dissected and analyzed separately in English-written blogs and literature. Just a random Friday musing. 🙂

    • Henrik: Great to hear from you. That’s a really fascinating observation. In many ways it really makes sense to look at the two as inseparable. In your experience, does it change the way Swedish companies look at performance management? Or is it more of a nuance? Thanks for the contribution!

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