BATCH: 2020-2022

SEMESTER: 3

ASSIGNMENT 2

SUBJECT: PERFORMANCE MANAGEMENT SYSTEM

TOPIC: DEVELOPING KRA AND KPI FOR BDM IN SaaS

SUBMITTED TO: Dr. Urmila Itam

SECTION: MHR

SUBMITTED BY:

Rekha J 20MBAR0287

Jisna George 20MBAR0190

Mithun K 20MBAR0269

Punith 20MBAR0315

Archana Krishnan 20MBAR0173

Define KPAs and KRIs – BUSINESS DEVELOPMENT MANAGER -
SaaS
Key result Key performance Weight Target Actual Score Final

areas indicators of KPI days days score

Achieve personal 10% 50 40 80 8

sales targets by sales sales

Achieve set
revenue developing new
growth.
business with

existing and

potential clients.

Prepare proposals 10% 15 15 100 10

and detailed days days

costings and

prepare contract

documents for

review by Sales

Director prior to

negotiation with

clients.

Actively and 20% 20 20 100 20

successfully days days

manage the sales

 process: lead

generation;

credentials pitch;

asking questions;

solution pitch;

negotiation; close;

handover to the

account

management team.

Client Deliver an 20% 3 days 2 days 66 13

experience excellent client

experience at all

times, ensuring

client needs are met

or exceeded.

Team work Work closely with 10% 15 15 100 10

business
development team, days days
share knowledge,
discuss ideas and
help the team to
achieve targets.
Contribute to 10% 10days 15days 66 6.6
healthy competition
within the business
development team
and develop strong
 and effective
working
relationships with
the account
management teams.
Ensure Adhere to company 15% 20 30 66 9.9

compliance policies and days days

requirement procedures and the

s corporate Code of

Conduct.

Compile with all 5% 20days 28 71 3.5

local legislative days

requirements.

Total 100 133 146 862 81

days days

Position Title: Business Development Manager

Job purpose: The Business Development Manager is responsible for securing
new revenue within the company’s existing portfolio of clients as well as
seeking out new clients. The role is expected to have a focus on hunting new
business. The role ensures an excellent client experience at all times and works
in collaboration with the account teams to ensure smooth transition of accounts
into the business
Sector: Software as Service sector
Department: Sales
Position level: C (Senior Specialist)
Reports to: Sales Director
Critical relationships: General Manager, Sales Directors, Account Management
teams, Insights Consultant, Client Experience Manager, Clients’ and potential
Clients’.

Formula to get score:

Actual/Target *100 (max)

Target/Actual*100 (min)

Final score:

Score*Weight/100
How SaaS Companies Are Collecting Data

As technologies that capture and analyze data proliferate, so, too, do businesses'
abilities to contextualize data and draw new insights from it. Artificial
intelligence is a critical tool for data capture, analysis, and collection of
information that many businesses are using for a range of purposes, including
better understanding day-to-day operations, making more informed business
decisions and learning about their customers.

Customer data is a focus area all its own. From consumer behavior to predictive

analytics, companies regularly capture, store, and analyze large amounts of
quantitative and qualitative data on their consumer base every day. Some
companies have built an entire business model around consumer data, whether
they're companies selling personal information to a third party or creating
targeted ads. Customer data is big business.

Here's a look at some of the ways companies capture consumer data, what
exactly they do with that information, and how you can use the same techniques
for your own business purposes.

Types of consumer data businesses collect

The consumer data that businesses collect can be broken down into four
categories: 

1. Personal data. This category includes personally identifiable information

such as Social Security numbers and gender as well as non-personally
identifiable information, including your IP address, web browser cookies,
and device IDs (which both your laptop and mobile device have).

2. Engagement data. This type of data details how consumers interact with

a business's website, mobile apps, text messages, social media
pages, emails, paid ads and customer service routes.

3. Behavioral data. This category includes transactional details such as

purchase histories, product usage information (e.g., repeated actions), and
qualitative data (e.g., mouse movement information).

4. Attitudinal data. This data type encompasses metrics on consumer

satisfaction, purchase criteria, product desirability and more. 
How do businesses collect your data?

Companies capture data in many ways from many sources. Some collection
methods are highly technical in nature, while others are more deductive
(although these processes often employ sophisticated software).

The bottom line, though, is that companies are using a cornucopia of collection
methods and sources to capture and process customer data on metrics, with
interest in types of data ranging from demographic data to behavioral data.

"Customer data can be collected in three ways: by directly asking customers, by

indirectly tracking customers, and by appending other sources of customer
data to your own. "A robust business strategy needs all three."

Turning data into knowledge

Capturing large amounts of data creates the problem of how to sort through and
analyze all that data. No human can reasonably sit down and read through line
after line of customer data all day long, and even if they could, they probably
wouldn't make much of a dent.

As machine learning algorithms and other forms of AI proliferate and improve,

data analytics becomes an even more powerful field for breaking down the sea
of data into manageable tidbits of actionable insights. Some AI programs will
flag anomalies or offer recommendations to decision-makers within an
organization based on the contextualized data. Without programs like these, all
the data captured in the world would be utterly useless
Leading and Lagging Indicators

Leading and lagging indicators are useful to track business performance. To

successfully conduct your business, you need to have full control over it. There
are many key performance indicators that companies use to gain complete
visibility of their business operations. These indicators can be grouped into two
categories – leading and lagging indicators.
Business performance indicators are usually measured in advance so that the
outcome can be adjusted in the favor of the organization. Few indicators are
measured beforehand while others are measured based on the result.
 Leading indicators are the metrics that allow you to measure change.
They are the clear indicators through which you know in advance if you
are going to achieve your goals or not. By measuring these indicators,
you come to know if there are any gaps in your strategies. Then an
appropriate action can be taken towards the improvement of the
processes.
When you have the power to track the progress of your business in advance,
you are in a better position to enhance your business. You don’t need to wait till
the end to know the final outcomes. The early warnings of any unfavorable
outcome allows you to take proactive measures to improve the parameters
towards better outcomes. Hence, leading indicators are useful in any SaaS
business aspiring towards operational excellence.

 Lagging indicators are the metrics that allow you to measure results.
These indicators are usually measured when the events have already
occurred. Hence, it leaves a lesser chance to improve upon the outcomes
because by the time you measure your outcomes, it is already too late.
Nevertheless, these indicators are still useful for doing the root cause
analysis and preventing any negative outcome from happening again.
The difference between leading and lagging indicators dissolves in a process
that is constantly in progress. By improving upon the lagging indicators, you are
in a way changing the leading indicators for the further process. Especially in
customer success, where there is no such thing as post sales, leading and
lagging indicators play a pivotal role in enhancing business growth.
 Some of the types of leading indicators in customer success include:
NPS

A net promoter score is a clear indicator of how a customer feels about your
brand. You ask a simple question to the customer that says “how likely are you
to recommend our product to others”? The response is measured on a scale from
1 to 10 with 1 being least and 10 being most likely. Any response less than 7 is
a red flag and allows you to know if the customer is going to continue with your
business or not.
CSAT

Customer satisfaction score is another leading indicator that tells about the level
of customer satisfaction with your company. Any customer with high
satisfaction would most likely remain loyal to your brand. With a low CSAT
score you can predict future events like customer churn.
 Few types of lagging indicators in customer success are:
Renewals

Customer success efforts have no meaning until the final outcome turns into
customer’s contract renewal. When a customer renews their subscription, it is a
clear indicator that your efforts in the past were in the right direction. This is
one of the lagging KPIs which every SaaS company desires the most.
Revenue growth

This is another lagging indicator which tells clearly if your organization is on

the right track. The revenue growth measured at the end of each fiscal year
reveals the percentage growth of a company. This allows you to keep a check
on your yearly growth. And any measurement below the benchmarks send you a
clear signal that you need to improve upon your business.
Churn

This is the most unfortunate outcome or a lagging indicator in any business.

When customers churn, it is the right time to evaluate your customer retention
strategies and find gaps. Churn rate for any month, quarter or a year becomes
the leading indicator for the next time-period.
Alignment of KPIs with strategic goals
 KPI 1
Achieve personal sales targets by developing new business with existing and
potential clients.
 Brings in new clients.
 Brings in revenue to the organisation.

 KP1 2
Prepare proposals and detailed costings and prepare contract documents for
review by Sales Director prior to negotiation with clients.
 Calculates risks and reduces unnecessary cost involved.
 Helps in finding alternative methods.
 Helps in finding various ways and methods available to perform the
action.

 KPI 3
Actively and successfully manage the sales process: lead generation;
credentials pitch; asking questions; solution pitch; negotiation; close; handover
to the account management team.
 Relaxed and flexible sales process.
 Motivates in lead generation.
 Develops communication skills with clients.

 KPI 4
Deliver an excellent client experience at all times, ensuring client needs are met
or exceeded.
 Client satisfaction.
 Builds and improves client relations.

 KPI 5
Work closely with business development team, share knowledge, discuss ideas
and help the team to achieve targets.
 Reduces communication gap.
 Creates a creative work environment.
  Creates responsibility and accountability.
 Motivates to complete target.

 KPI 6
Contribute to healthy competition within the business development team and
develop strong and effective working relationships with the account
management teams.
 Promotes healthy work space.
 Helps in team building.
 Promotes more productivity among employees,
 Helps in managing teams and works.

 KPI 7
Adhere to company policies and procedures and the corporate Code of
Conduct.
 Ensures legal and ethical operations of activities.
 Ensures that a proper legal framework is followed.
 Ensures rules, regulations and policies are followed.

 KPI 8
Compile with all local legislative requirements.
 Ensures safety of personal information of information.
 Ensures data confidentiality.
 Ensures security in workplace,
Calculating costs of KPI tracking
 SALES GROWTH
Is your business growing steadily?
It's a fact that by tracking the growth of your sales, you also track the growth of
your company.
Performance Indicators
A positive sales growth over a specific period of time indicates that you are on
track with your sales goals to grow your business.

 SALES TARGET
Are you on track regarding the sales targets?
One of your top priorities should be to understand if you are on track to reach
your planned goals.
Performance Indicators
In a good assessment of your actual revenue versus your forecasted revenue, the
goal should be to outperform your forecasted amount.

 CUSTOMER ACQUISITION COST

How much does a new customer cost?
When we mention customer acquisition cost (CAC), we are referring to all costs
incurred in signing up a customer.
Performance Indicators
The goal is to increase customer lifetime value and average revenue per unit or
user/account while cutting CAC, to maintain a profitable business.
  AVERAGE REVENUE PER UNIT (ARPU)
What is your average revenue per user?
ARPU stands for average revenue per unit, the unit part of the acronym can also
stand for user, account or any other paying customer. This sales KPI indicates
the average customer’s revenue from all your sales.
Performance Indicators
If your ARPU is rising you should be on track. This usually means that you are
signing bigger customers, or signing customers with bigger plans.

 CUSTOMER LIFETIME VALUE (CLV)

How much do you expect to earn per customer?
Our next sales KPI example refers to your customer lifetime value (CLV) which
is important to track because the longer you keep having paying customers, the
more you’ll make.
Performance Indicators
As long as customer lifetime value and average revenue per unit are growing,
you’re in the green and your CAC are appropriate.

 CUSTOMER CHURN RATE

How many customers do you lose?
One of our sales KPI examples is especially important for businesses with
monthly recurring revenue such as SaaS businesses. The customer churn rate
expresses the number of customers who stopped using your company’s products
or services in a defined timeframe and gives you a realistic overview of your
customer retention strategies and what kind of trends you cope with.
Performance Indicators
The higher the churn rate, the more customers and revenue you will lose. It
should be on top of your priorities when it comes to developing retention
strategies.
  AVERAGE SALES CYCLE LENGTH
How do you shorten your sales cycle?
If it's realistic to shorten your sales cycle in your industry, you first need to
understand how you can optimize your current sales cycle.
Performance Indicators
Once you have a sales cycle length baseline, the goal should be to decrease that
number, resulting in more sales in a shorter period of time.

 LEAD-TO-OPPORTUNITY RATIO
How about your lead quality?
For the most part, every new lead is an unqualified lead at the beginning.
Conversely, a qualified lead refers to a lead that meets qualification
requirements.
Performance Indicators
Your lead-to-opportunity ratio is the first part of the sales funnels to be
examined. By looking at what is working and what isn’t you have a better idea
of where quality leads are sourced from and can guide the marketing and sales
team better.

 OPPORTUNITY-TO-WIN RATIO
How many qualified leads result in closing a deal?
This sales KPI tells us how effectively a sales team or sales manager closes
accounts.
Performance Indicators
The closer the ratio of opportunity-to-win, the more effective your salespeople
are at the later stage of the pipeline. If your team isn't closing a minimum of
15% of your qualified leads, you might need to rethink your qualifications
process.
  LEAD CONVERSION RATIO
Is your conversion ratio stable?
One of the most important KPIs for sales is the magic number, the lead
conversion ratio – ostensibly the number of interested people that turn into
paying customers.
Performance Indicators
If your lead conversion rate is on target, you know that your sales pipeline is in
good shape. A low lead conversions rate alerts you to weaknesses in your sales
pipeline. Find benchmarks for your specific industry and use them as a target.

 NUMBER OF SALES OPPORTUNITIES

What is your potential purchase volume?
The number of currents and new sales opportunities plays a decisive role in
sales management. To properly optimize and increase the value of your sales
metrics, the number of opportunities should be high on your list.
Performance Indicators
Monitor the number of (new) sales opportunities and their potential purchase
value. This allows you to identify bottlenecks in your sales funnel at an early
stage.

 SALES OPPORTUNITY SCORE

Do you prioritize your sales opportunities?
First of all, every single sales opportunity needs to meet your minimum lead
requirements. However, there are of course still different classifications within
opportunities in terms of potential and sales opportunities.
Performance Indicators
Adequate opportunity scoring enables you to achieve your sales targets even in
highly competitive markets so this metric should be monitored regularly.

 AVERAGE PURCHASE VALUE

Is your average purchase value sustainable?
The average purchase value is one of the sales performance metrics that you can
use when developing a sales growth strategy, revenue projections, and
forecasting.
Performance Indicators
Compare your average purchase value with your past performance in order to
understand if the metrics increased or not and look into it together with the
number of opportunities.

 REVENUE PER SALES REP

How much revenue do your sales reps bring?
KPIs for sales must include stats about sales reps. You need to know how your
team is performing and what kind of targets they need to reach, and this sales
KPI will help you to do just that.
Performance Indicators
Identify which of your sales rep is bringing the best results and compare them
with other representatives to be able to improve your team’s performance.

 PROFIT MARGIN PER SALES REP

Is your sales team profitable as expected?
Profit margin is one of the KPIs for sales that expounds on the profitability of
the sales reps. This KPI is useful when management needs to determine whether
to offer promotions or bonuses for each representative or to determine the
amount of the commission.
Performance Indicators
Compare your results over time and identify each sales reps’ strengths. See if
the targets are met or your sales strategy needs additional adjustments.

 UPSELL & CROSS-SELL RATES

How do you increase your revenue and ROI?
By implementing effective upselling and cross-selling tactics in your sales
department, you stand a greater chance to increase your return on investment
(ROI) and revenue in the long run.
Performance Indicators
Compare your upselling and cross-selling rates by the sales reps and see which
one of them is the most successful. Implement their tactics to the whole sales
department.

 INCREMENTAL SALES BY CAMPAIGN

Which campaign brings you the best results?
Incremental sales by a campaign is another important KPI as it shows the
number of sales generated by each marketing activity you have performed,
whether through social media or e-mail.
Performance Indicators
Identify your best campaigns that have brought to you the highest number of
incremental sales, and monitor the results over time.
Role Of a Business Development Manager  - B2B Sales - SaaS

Maintaining and developing relationships with new & existing clients.
 Closes new business deals by coordinating requirements; developing
and negotiating contracts; integrating contract requirements with
business operations.
 Locates or proposes potential business deals by contacting potential
partners; discovering and exploring opportunities.
 Acting as a contact between a company and its existing and potential
markets.
 Develop a clear understanding of the client's needs, concerns,
objectives and plan an appropriate approach/pitch.
 Marketing Coordination: Assist with trafficking of marketing
projects such as follow-up with clients, lead generation, content
development, website management, new business activities, and more.
 Social Media: Managing social media handles which includes:
Content Writing, Managing Blogs.
 Experienced and confident in writing propositions/bids, E- Tenders
creating presentations, and writing external reports.
 Enhances organization reputation by accepting ownership for
accomplishing new and different requests; exploring opportunities to
add value to job accomplishments.
Expected Behavior Vs. Reality

Expected Behavior in SaaS: A culture that embraces SaaS tends to be growth-

minded, engagement-driven, knows how to tap cross-functional expertise in
scalable ways, is data-aware, and thinks in terms of agility for real-time services
delivery and customer success.

This viewpoint is influenced by the evolution of real-time feedback, continuous

learning, and performance management concepts. Employee engagement is
business critical because employees will learn new behaviors and skills,
improve their productivity, and be happier in their roles when they are fully
engaged and aligned with business goals. Based on hundreds of customer
relationships and our own research, the level of employee engagement and
growth are directly linked to the quality of an employee and manager
relationship.

1. Positional Leadership: people follow you because they have to

2. Permission Leadership: people follow because they want to
3. Production Leadership: people follow you because you make them
more productive
4. People Leadership: people follow because you help them to become
better
5. Peak Leadership: people follow because you help them become better
leaders

According to a recent blog by HR Leader Rachel Ernst, leadership is not

something that people schedule around but is actually delivered and observable
in their every move. Leaders are mindful of their behaviours in real-time, and it
takes an authentic leader to empower employees. She states there are three areas
to focus on to support and lead high-performing people and retention across
functions:

1. Work with genuine curiosity

2. Enable the power of people
3. Instil humanity in the workplace
Reality
This real-time reality directly impacts our ability to manage and lead in any role
as high-performing individual contributors and people-management leaders.

According to Gartner Inc., mainstream adoption of software-as-a-service (SaaS)

is forcing software providers to transform their businesses to be more
responsive to customer needs, market changes, workforce capabilities, and skills
development. Further, technology business unit leaders are adopting new
indicators of success, unconventional business models, and practices to help
ensure more personalization, speed to market, sustainable growth, and more
predictable profitability.

In this real-time, highly-connected environment, SaaS can help HR leaders and

organizations at large to develop new behaviours and leadership skills if they
choose to embrace organizational agility and urgency, rather than fight it.
According to McKinsey & Company, “Agility is the ability of an organization
to renew itself, adapt, change quickly, and succeed in a rapidly changing,
ambiguous, turbulent environment. Agility is not incompatible with stability —
quite the contrary. Agility requires stability for most companies.”
Organizational agility goes well beyond development and IT teams; organizing
for urgency is a business imperative. McKinsey advocates that “to compete at
the speed of digital, you need to unleash your strategy, your structure, and your
people.”
Rewards Matrix for Improved Performance
Cash Incentives vs Non-cash Incentives
Cash rewards are the traditional incentives that the sales reps receive
outside their compensation/commission. These rewards are given as a
bonus to the sales reps upon achieving a specific sales target.
Non-Monetary incentives are non-cash perks or benefits provided by an
employer to an employee

1. Split incentives
Many products and services are highly complex and require sales specialists to
assist front line sales reps with the sale.
For example, a SaaS company selling white-label applications may consistently
add new features to their software developer kit (SDK). As these features are
rolled out, the specialized product manager on the sales team may need to assist
with in-depth explanations of the product’s new capabilities.
In this case, there are two main stakeholders involved with the sale: the sales
rep and the sales specialist or product manager.
Alternatively, you may want to pair two or more reps on your team to work
together to close a deal. The reps may work in different regions, for example,
and both need to get their regional prospects on board in order to help close the
deal.
If this is the case, a split incentive program may encourage your reps to work
together and collaborate on their efforts. It’s also the fairest way to compensate
all parties involved in the close.
You can either split the incentive down the middle or by a predetermined
proportion. No matter what structure you choose, make sure you have clearly
defined the rewards ahead of time in order to reduce tension and promote
fairness.

2. Presales incentives
As alluded to above, today’s sales process is more complex than ever before.
Customers are inundated with advertisements and outreach from companies that
sell similar products and are trying to outperform one another.
This results in the customer taking a longer time to compare and contrast their
choices. They may request demos from each company and spend time
researching the benefits and drawbacks of each. Ultimately, the entire customer
journey is elongated because of this extended evaluation period. A rep may be
in contact with a prospect for a year or longer.
In extended sales scenarios, it may be worth rewarding your reps throughout the
various sales stages in order to keep them motivated. This will encourage both
short-term and long-term focus.
Ideally, you will assign a balanced portfolio to your reps comprising both short
and long sales cycles. But in a situation where a deal turns into a long-scale
pursuit, presales incentives can help keep your reps on the ball.

3. Travel:
Most people love a free trip so a travel voucher is an incredibly popular option.
People get enthused about travel plans and it’s usually the most sought-after
reward. Therefore, you may want to save it for the top performer or whatever
you qualify as your highest value output.

4. Recognition in the company

Although most workers are satisfied with their jobs overall, a study from
the American Psychological Association found that a whopping 44% of workers
are not satisfied with the recognition they receive from their employer.

Another study found that up to 50% of workers who received an incentive at

work are more focused on how the reward is presented to them than on the
reward itself.

So, recognition in itself can be a powerful motivator. 

5. Lunch with CEO

For some reps, the ultimate reward is to learn, grow professionally, and get
recognized by their peers. For such employees, offering to have lunch with
the CEO of the organization is a good option. This will give them
recognition among their colleagues and also a chance to pick the brain of
your company’s leader.