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Why use OKRs for Sales?
There can be questions about the value of OKRs for Sales. They're metrics-driven by definition, and their targets are directly tied to the bottom-line. So what's there to change? The answer is alignment. Sales are the most effective when their strategy aligns with what the Product and Marketing teams are doing.
OKRs will help everyone get a shared understanding of what the top priorities are for each function and allow organizations to concentrate efforts on specific outcomes.
Focus areas:
Key questions:
Which channel(s) and market(s) do we want to focus on this quarter?
Are our efforts aligned with Product, Marketing and Customer Success?
Are we happy about our current acquisition costs?
Do we have the right resources to have an efficient sales process?
Example of Sales OKRs
Take advantage of your Objectives to be specific about your growth opportunities. Avoid statements like "Increase revenues", or "Double the amount of customers". It's pretty obvious that we want to grow the business, and vague statements won't help other teams understand how they can help with sales.
Good Objectives should help anyone understand where to focus their energy. "Increase revenues" leaves too much room for interpretation. "Expand to European markets" will produce more focused initiatives, and your Product team can align their own goals to support different regions.
OKRs to expand Sales to a new region
Expand revenue in Europe
10% of new sales are coming from EU customers
Generate a pipeline of $500K in Europe
Recruit 10 resellers in Europe
OKRs to enable a better Sales process
Turn Sales into an efficient growth engine
Reduce the sales cycle from 9 to 3 months
Increase inbound sales by 30%
Reduce Customer Acquisition Costs from $740 to $350
OKRs to develop Enterprise Sales
Become a compelling offer for large and Enterprise customers
Sign 15 Enterprise customers with ACV >$60,000
Generate $3M in qualified Enterprise leads
Recruit 3 Enterprise Sales specialists
OKRs to increase sales through channel partners
Make channel partners a significant part of our success
Recruit 25 new channels partners in US and EU
Get $120,000 in ARR through channel partners
Generate $20,000 in revenue for partners through our affiliate program
OKRs to hit revenue milestones
Achieve $5,000,000 in quarterly revenue
Achieve 30% upsell to existing customers
Increase MRR from $1.5M to $1.8M
Successfully expand revenue to EU market with $500K MRR coming from Europe
Tracking your OKRs
Knowing how to write good OKRs is critical, but without good tracking in place, the OKRs will fade away and focus will be lost.
The easier it is for a team to have weekly discussions around the OKRs, the better they'll execute. Here are a few best practices for tracking OKRs.
1. Do weekly check-ins
Quarterly OKRs should be tracked every week to be effective. Without a continuous reflection on progress, your OKRs won't be much different from having KPIs.
The check-ins process can be automated with a platform like Tability that takes care of reminders, and distribute updates to the teams.
2. Keep track of your confidence
Good progress updates should help everyone understand how far we are from our goal, but also how confident we are in achieving it. You can use a simple red/yellow/green color coding to indicate your confidence.
3. Make trends easy to see
Lastly, it's important to look at trends to avoid false positives. It's not rare for a team to have a hot start and then slow down mid quarter. This will be hard to see unless you can look at progress trends for individual Key Results.
What other Sales metrics can you use?
Now that you've got good Objectives, it's time to pick some key results and finding good metrics that work for your team can be tricky. Lucky for you, we've laid out all the best Sales success metrics to use.
Here are a few to get you started:
New/Expansion MRR
How much revenue should come from new customers or existing customers.
Sales cycle time
How long it takes for a lead to turn into a paid customer.
Monthly onboarding/demos calls booked
How many leads are booking demos with the sales team.
Lead conversion rate
Percentage of leads that turn into paid customers.
Average Revenue Per User (ARPU)
How much revenue do you get per customer on average, over a certain period of time. Can also be ARPA (Average Revenue per Account) or ARPC (Average Revenue per Customer).
Customer Acquisition Costs (CAC)
The cost of turning a lead into a paid customer.
Customer Lifetime Value (LTV)
How much revenue do you get on average per customer, from the moment they start paying until they leave.
Pipeline value
Expected revenue from all active sales opportunities if they all converted.
Got an objective in mind, but not sure how to get there?
Tability's free AI can create a detailed strategy with all the steps to take to reach your goals.
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