How many Indian companies in your professional career have you seen implementing a robust, comprehensive, automation-driven and scalable key performance indicators (KPI) framework for any business function, leave alone sales? I am pretty sure the count is low, if at all. There’s a reason for it – KPI creation and rollout is a complex, multi-functional and strategic exercise which takes alot of senior management bandwidth, but more than that a very strong will, business vision and mature automation.
What is a KPI Framework?
A key performance indicator (KPI) is a metric used to measure the performance of a business function within a specific industry, designed thoughtfully on criteria’s or parameters that best reflect the health of a business function. A single KPI can only cover a particular element of performance (say number of active leads per salesman) but if one wants to do a comprehensive analysis, a set of logically connected KPI’s are required which is the philosophy behind building a KPI framework.
KPI framework, therefore, is the science of grouping related KPIs together, in a way that provides crucial context, helping organisations prioritize optimization efforts and understand how performance of certain KPIs impacts the performance of other KPIs. While doing so, it is ensured that they are measurable and leave no room for subjectivity, proving the company a methodology to analyse performance across the organisational hierarchy. That is, KPI framework can be designed to act as top down or bottoms up depending upon the key responsibility areas (KRA’s) of the business function and its hierarchy. Also, KPI’s can be designed as leading or lagging indicators of business performance, always having a benchmark or baseline or target value. And incentive structures can be planned around fulfilment of one of more KPI’s in the framework.
How Can Peri Help?
At its fundamental level, Peri is a sales enablement platform, our role, as we see it, is to give Indian FMCG companies a great technology platform to improve efficiency of their sales, marketing, logistics and other support functions. We believe putting a well-designed (user adoption is highly important, often neglected), industry-specific (generic CRM won’t serve all your business processes) and scalable CRM (CRM platform should evolve with time) takes care of 80% of the work. 10-15% of the work is then taken care by an easy-to-use and agile data visualisation and analytics platform (like Tableau or Power BI or Zoho analytics).
The last (and often the game changer) 5% is solved by a thoughtfully designed performance assessment framework of which KPI framework is an integral part.
Early 2020, leadership at Peri CRM realised that providing a great sales automation platform, supported by a best-in-class data analytics tool may not be complete without empowering the FMCG companies with a comprehensive, industry-recommended KPI framework.
Peri has designed and is constantly evolving a Sales KPI framework on the following lines:
Top Sales KPI's !
Peri’s team has been involved with Indian companies on business process automation, enterprise applications and sales initiatives for more than 10 years now. Along this journey, we have picked a thing or two about sales performance management, what matters most to sales leaders and line managers and the role KPI’s can play in a strategic or tactical initiative such as sales improvement or augmentation for them to be more impactful.
In addition to that, Peri’s existing client portfolio has subject matter experts, thought leaders and highly experienced professional who have contributed to the development of this KPI framework. Below is a list of KPI buckets as part of Peri’s offering, tuned specifically for Indian FMCG industry:
- FMCG Basics (set of 6-8 KPI’s): These KPI’s are leading in nature and give a view of how well a salesperson is performing on the basic skills of FMCG sales like discipline (time and place of hitting the market), planning and preparedness (defined and optimised beat), proper market coverage (time in market and distance travelled) and periodic market expansion. These KPI’s rollup using averages.
- Sales Calling (set of 4-6 KPI’s): These KPI’s are also leading in nature and showcase the pattern, effectiveness and quantum of the sales calls (or retailing) of a frontline sales representative. They take into account key elements like number of calls made (TC), whether these were beat or out-beat calls, what was the breakup of calls by retail category and business potential, the average time spent per call and few more granular parameters. These KPI’s rollup using averages.
- Order Taking (set of 10-12 KPI’s): These KPI’s are lagging in nature and provide a tangible outcome of the above two leading KPI buckets. They takes into account key elements like number of productive calls made (PC), typical conversion ratio (TC to PC), average order quantity (including value, realisation), split of orders by SKU i.e. lines per call (LPC) and brands per call (BPC), premiumisation of orders and few more granular parameters. These KPI’s rollup using averages.
- Sales Target (set of 4 KPI’s): These KPI’s are lagging in nature and give a hard sales number assessment of a frontliner vis-à-vis expectations from his upline. These include target v/s achievement (in various cuts), daily achievement rate and the ask rate.
- Key Products (vary by company to company): These KPI’s focus on specific products (handled in Peri using product classification) within a company’s portfolio and are tuned as per the company’s need. Some companies want to tag their product as premium, some as focus, some as newly launched and some by their profitability. These KPI’s provide numbers (quantity and value) and reach across the retail channels.
- Adhoc: These KPI’s are Adhoc and can be both leading and lagging in nature. They can focus on areas like market expansion, stock audits, product sampling, trade promotions, cost of sales, joint working and more depending upon the Peri functionalities opted by the company.