What Should a Sales Performance Review Include?

In a field as challenging and dynamic as sales, performance reviews are critical – both for managers and for individuals. Not only are they a way to evaluate past performance, they also provide an opportunity to assess progress, identify areas for improvement, and set goals for the future. 

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But what should a sales performance review for your team include? In this article, we look at sales performance review must-haves, what to include in monthly, quarterly, and half-yearly reviews, and how you can get the most out of your sales performance reviews.

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A sales performance review should focus on evaluation and improvement. Make sure to include a review of sales metrics/performance, sales processes and pipelines, as well as sales activities and skills. In addition, provide targeted feedback and set clear goals for future performance. Another useful addition to a sales performance review is recognition/rewards.

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Before we proceed, it’s important to remember:  what you need to include in a sales performance review will also depend on the frequency and timing of the review. 

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Though annual performance reviews are the conventional standard, the sales function benefits from more frequent monthly or quarterly performance reviews. They give individual sales rep the direction and inputs they need while helping the leadership/managers get a pulse of the team’s performance.

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5 things to include in a sales performance review

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1. Sales Metrics and Performance Analysis/Review

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When it comes to sales performance, metrics and tangible results are critical. This part of the review focuses on the goals and the results achieved. 

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Start by highlighting the sales metrics that matter most to your business. This could include revenue generated, sales volume, conversion rates, and customer acquisition cost (CAC). This sets the right context and tone for the review –  and helps sales reps see how their performance aligns with the company’s goals.

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Next, analyze the team and individuals’ revenue numbers and quota attainment. This gives the team an objective assessment of the results they have delivered for the company – besides spotlighting high-performing individuals and highlighting areas of improvement for the team and individuals.

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How you design this section of the sales performance review will depend on the frequency and timing of the review – which in turn depends on your product’s sale cycle. 

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Here are a few guidelines: 

• When it comes to monthly sales performance reviews, you may not always have performance results, but use the meeting as an opportunity to remind sales reps of the company’s and their goals.
• For half-yearly or quarterly reviews, focus on both the company’s goals and the team’s progress toward achieving them via individual quotas. 
• For an annual sales performance review, focus heavily on the revenues and the company’s goals. 

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2. Sales Process and/or Pipeline Review

Performance reviews are not just about evaluating individuals and their performance, they are also an opportunity to zoom out and evaluate the team’s processes as well as prospects.
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• Process review: As a sales leader, you need to ensure your team is set up to succeed and equipped with everything they need to perform at their best. 
  
  Use a sales performance review to understand process bottlenecks or identify any roadblocks that prevent sales reps from meeting their sales performance goals.
  
  This can help you uncover the need for additional training, specialized sales tools, or sales enablement resources.  
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• Pipeline review:  To ensure that your team is working on the right opportunities, review your team's sales pipeline.
  This will help you assess the quality of leads, identify areas of support/intervention, and understand where deals are getting stuck.
  
  With this analysis and review-based approach to sales performance reviews,  you don’t end up only looking at whether goals were achieved. Instead, you identify how you can help individuals and the team improve, while taking some accountability for their performance – positively impacting each sales rep’s outlook and motivation.

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Typically, a quarterly sales performance would benefit from both a process and pipeline review, whereas a monthly sales performance review might need just a pipeline review.

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3. Sales Activities and Skills Review 

While the number of sales a rep has made, or the revenue they’ve generated is important, a sales performance review is a good time to dive deeper into the activities and skills they need to reach their goals.

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Review your team's sales activities, such as prospecting, cold calling, follow-ups, demos, and closing. These activities that take up the bulk of a sales rep’s time processes are the foundation of their results. Here are a few activity-oriented metrics to cover during your sales performance review:

• Number of leads generated 
• Number of meetings booked
• Number of demos given
• Upsell and/or cross-sell rate
• Length of the sales cycle

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Compare these numbers against the numbers from the previous review. This will help you identify where your team is excelling and the skills or areas in which they need additional training, support, or sales coaching.

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While activity and skill review is most effective in a monthly sales performance review, including them in quarterly, or half-yearly performance reviews will help you identify broader trends and surface kill gaps and productivity or efficiency issues.

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4. Positive and Negative (Constructive) Feedback

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Studies have found that today, 92% of employees want feedback more often than just once a year. Monthly, quarterly, and half-yearly reviews are a great way to ensure you give your sales reps what they need.

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According to a study in Harvard Business Review, 92% of employees feel that negative feedback is important to improve their performance. In fact, 57% of the study’s respondents preferred corrective (negative) feedback over praise or recognition!

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In every sales performance review – be it monthly, quarterly, or half-yearly, acknowledge and highlight sales reps’ strengths, but also give critical but constructive feedback that will help them improve. 

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Be specific – let them know which activities and skills they need to improve, and offer them additional support, training, or resources to help them get there.

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For monthly reviews, feedback on their skills – such as clear communication, objection handling, active listening, etc., might be more helpful. Conversation intelligence tools are helpful in this regard – they can help you identify how sales reps are performing in their meetings, so that you can ground your feedback in data and context.

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For quarterly or half-yearly reviews, your feedback could focus on specific areas or stages of the sales cycle and best practices for them. 

5. Future Performance Goals

A sales performance needs to be as prescriptive as it is evaluative. This means that you need to ensure that it is action-oriented. 

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End the review with a detailed action plan that sets expectations and goals to be achieved before the next performance review. 

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A Gallup study found that only around 50% of employees “strongly agree” that they know what’s expected of them at work. Set performance goals for each sales rep based on their strengths and weaknesses, as well as the company’s overall sales goals. Wherever possible, connect each goal or focus area to a team or company priority.

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Lastly, as recommended for any goal-setting exercise, ensure that the goals set are SMART  – i.e. that they are specific, measurable, and achievable within a reasonable timeframe. This will give your team direction and purpose to keep going till the next sales performance review.

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For monthly sales performance meetings, ensure that goals are a mix of improvements and outcomes. For quarterly reviews, goals can be more outcome-focused. As per a study quoted in Forbes, companies that set quarterly performance goals see 31% greater returns from the performance process compared to those that do it annually. 

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Recognition and Rewards: A Great Addition to a Sales Performance Review

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69% of employees say they would work harder if they felt recognized. 37% of them would be encouraged to produce better work if they received more personal recognition.

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Recognizing and appreciating employees is one of the easiest and most effective ways to motivate and engage them. A sales performance review is a great avenue to do just that,

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Conclusion

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A sales performance review done right is a sure-shot way to boost sales efficiency, improve team morale, and drive better business results.

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The key is to ensure that your review meetings track measurable metrics, review existing processes and systems, provide actionable feedback, and set clear goals.

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Of the five elements we’ve elaborated on in this article, here is a quick summary of top three focus areas, depending on the cadence of your sales performance review.

• Monthly review: Sales activities and skills, pipeline review, feedback
• Quarterly: Performance metrics, pipeline/process review, feedback
• Half-yearly or annual: Performance metrics, feedback, performance goals

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