What are the must have KPIs and what are some useful KPIs teams may not think of?

I like to think about KPIs for any revenue organization in a 3 P's framework :

1. Performance

2. Predictability

3. Productivity

Performance:

It's important to understand the performance trends of the company and the most common KPS in this category include:  

- ARR

- Retention

- Number of Customers (Existing + New Logos - Churned Logos)

- Gross Margin.  

For each of these KPIs, I like to look at the numbers vs. goal, vs. last year (YoY) and vs last quarter (QoQ). These are the basic health markers of any company and ones that all revenue ops leaders should know by heart for their companies/business units.

Predictability:

For any company, it's important for a revenue org to be able to deliver a forecast. And Revenue Ops plays a big role in this process, working with sales leadership. Typically, I like to see:

- Week 1 and Week 7 Currrent Qtr Fcs Accuracy - this is usually measured in % terms and is calculated using the final bookings or retention results divided by the forecast at the start and halfway points in the quarter. I am for at least 90% accuracy in Week 1 and 97% accuracy in Week 7.

- Starting Qtr Pipeline Coverage - how much pipeline (signing in the same quarter) is needed at the start of each quarter to hit the bookings/revenue goals, usually represented in X.X coverage ratio form. This one is good becaause it combines your win/converstion rate with your team's ability to predict accurate close dates. For volume and velocity-based businesses, it's important to also note how much pipe gets generated and closed within the quarter and incorporate that component as a KPI.

- Push Counter - how often are opportunities pushing from their original close dates in your CRM? If you see this number start to creep up over time, you're likely going to start to see some forecast accuracy challenges down the road. It means your team's pipeline hygeine is getting sloppy or deals in your market are becoming tougher to predict close timing,

Productiviity (or Effiency):

Over the course of 2022, many companies have made productivity and efficiency metrics a much bigger part of their corporate narrative. And I think a lot of companies will come out of this year in a stronger position because of it. To me, there's not just one or two metrics that can tell you how well a revenue engine is working. I think it takes a variety of productivity-related KPIs including:

- % of AEs hitting quota (Attainment) - I like to use the rule of thumb that when 75% or more of your AEs are hitting 75%+ quota attainment, then you should hire more AEs. If you're not quite performing at those levels, there is more to do before you start hiring rapidly.

- % of AEs winning a new opportunity (Participation) - It's important to look at what % of your sales team is getting a deal across the finish line each quarter (or every month for shorter sales cycles).   

- Win Rate / Close Rate - I prefer the $-based metric (win rate), especially if you're tweaking your ICP and trying to sell larger ASP deals.

- Contacts per Qualified Opp - a good metric to dermine if you're single-threaded in your opportunities. More contacts on each opp almost always equals a higher conversion rate.

Growth Efficiency - this metrics looks at how much incremental recurring revenue was generated from new investment in sales and marketing $

- Activity - I'm and old school guy in that I still llke to look at seller and SDR activity levels. You can't sell when you're not in front of customers and I think it's a good idea to hold revenue team members accountable to a set of activity metrics, including meetings held, pipeline generated, new accounts touched to name a few.