Marketing & Sales Practice
Sales automation: The key
to boosting revenue and
reducing costs
Automation tailored to sales operations is a win for companies,
customers, and sales reps. Here’s how to make it work.
by Manu Bangia, Gui Cruz, Isabel Huber, Philipp Landauer, and Varun Sunku
© Getty Images
May 2020
Sales automation holds the potential to reduce time, higher customer satisfaction, efficiency
the cost of sales by freeing up time spent on improvements of 10 to 15 percent, and sales uplift
administration and reporting and to unlock potential of up to 10 percent.
additional revenue by automating outreach to
customers in the sales funnel. But many decision
makers are not aware—or have not taken About a third of all sales tasks can be
advantage—of the value that sales automation can automated
create across a growing range of use cases. Automation of standard tasks is one of the
megatrends that shapes the global economy.
To benefit from the emerging opportunity, sales Cross-functional research by the McKinsey Global
organizations must adjust their ways of working Institute (MGI) indicates that approximately a third
as well as their technology platforms to ensure of sales and sales operations tasks can be easily
that sales reps and automation solutions work automated with today’s technology (Exhibit 1).¹ This
hand in hand. Early adopters of sales automation makes sales one of the most promising functions in
consistently report increases in customer-facing terms of automation potential.
1
A directional figure based on a top-down assessment and interviews; the exact figure will depend on a company’s starting point and specific
sales dynamic.
Web <year>
<article slug>
Exhibit <x> of <y>
Exhibit 1
Morethan
More than30%
30%ofofsales-related
sales-related activities
activities cancan be automated.
be automated.
Highly automatable with today’s technology
Automation potential of tasks within sales subfunctions
Sales value chain Example activities Percent of total activities (top-down estimate)
Forecasting, channel strategy,
1 Sales strategy
and planning
resource allocation, talent 29% 71%
management
Pipeline management, action
2 Lead identification plans for new and existing 13% 87%
and qualification
customers
3 Configuration, Quota setting, configuration of
pricing, and technical solutions, negotiation, 43% 57%
quotation contracting
Credit checking, invoicing,
4 Order management 50% 50%
order-related service handling
Regular follow-ups, handling of
5 Postsales activities incoming requests (eg, for spare 40% 60%
parts, repairs)
Reporting, analytics, training,
6 Structural support provision of sales support 25% 75%
materials, administrative tasks
Total 31% 69%
Source: Vendor landscape review, expert interviews
2 Sales automation: The key to boosting revenue and reducing costs
Despite this considerable potential, only one proposals are automatically populated with
in four companies has automated at least one enterprise resource planning (ERP) data. A
sales process (Exhibit 2). From our conversations sales rep reviews the finished proposal and
with top executives, we know that many sales sends it to the customer.
executives are not yet aware of the breadth
and depth of state-of-the-art automation This program has resulted in higher customer
applications across the entire spectrum of sales satisfaction and a 5 percent uplift in revenue.
subtasks, nor of the value they can unlock. Other examples of the benefits of automation
include an overall cost reduction of 10 to 15
Best-in-class companies, however, have started percent and a reduction of order processing
adopting automation as a key driver of cost time—from confirmed order until confirmed
efficiency and increased sales. For example, delivery —from two or three days to one or two
an advanced-industries company applied hours.
automation to streamlining its bid process,
reducing proposal time from three weeks to two
hours. Previously, all requests were handled Opportunities exist all along the
by sales reps. “We used to do everything sales value chain
manually—assembling documents, looking up Companies seeking to drive up the automation
specifications, putting together the proposal,” rate of their sales function should start by
a sales executive says. Now, predesigned sizing the total opportunity and identifying the
Web <year>
<article slug>
Exhibit <x> of <y>
Exhibit 2
Automation
Automation implementation
implementation in sales
in sales is lagging.
is lagging.
Which of the functions within your organization have already automated at least one business process?
% of respondents, N=764
IT 48
Finance 44
Supply chain 36
Customer service 34
HR 31
Sales and marketing 26
Procurement 25
Risk and compliance 15
Communications and PR 13
Legal 6
Source: “The automation imperative,” McKinsey & Company, September 2018, McKinsey.com. The online survey was circulated from January 16–26, 2018, and
garnered responses from 1,303 participants representing a full range of regions, industries, company sizes, functional specialties, and tenures. Of these
respondents, 764 work at organizations that have piloted the automation of business processes or have fully automated them in at least one function or
business unit. To adjust for differences in response rates, the data was weighted by the contribution of each respondent’s nation to global GDP.
Sales automation: The key to boosting revenue and reducing costs 3
Sidebar
How we define sales automation
We define sales automation as any technology that is able to replicate human cognitive capability, such as logical reasoning,
pattern recognition, and so on, thus reducing manual labor in a given sales process. While multiple technologies are available,
we see five technologies as core to sales automation efforts: machine learning (ML), robotic process automation (RPA),
natural-language processing/generation (NLP), smart workflows, and virtual agents.¹ Currently, machine learning and robotic
process automation are the most popular technologies in sales, with adoption rates of 70 and 55 percent, respectively, among
sales automation pioneers.²
1
Federico Berruti, Graeme Nixon, Giambattista Taglioni, and Rob Whiteman, “Intelligent Process Automation,” March 2017, McKinsey.com.
2
Based on the comprehensive MGI definition of automation in “A future that works: Automation, employment, and productivity,” January 2017, McKinsey Global Institute: “Our
definition of automation includes robotics (machines that perform physical activities) and artificial intelligence (software algorithms that perform calculations and cognitive
activities). Companies may adopt these technologies for reasons other than labor cost savings, such as improved quality, efficiency, or scale.”
most promising use cases, based on a systematic Based on the ML output, sales and marketing
review. Use cases exist all along the sales value staff can take targeted actions to prevent
chain (Exhibit 3). churn, such as preconfigured price discounts to
incentivize customers.
Examples include:
— RFP generation. Solutions based on natural-
— Lead management. Chatbots enable language processing/generation and robotic
companies to re-engage prospective process automation can help reduce the time it
customers who are stuck in the purchasing takes to draft requests for proposals (RFPs) by
funnel, thus creating new opportunities up to two-thirds and eliminate human error. For
without any extra human effort. The bot example, one solution decodes the questions
independently selects customers, contacts to be answered and proposes responses in a
them through text message or email, uses customized file that can be automatically sent to
natural-language processing to understand the prospective customer. This kind of solution
the context of their response, and answers has the potential to speed up RFP response
accordingly to drive conversion. This solution time and efficiency while also improving internal
can increase sales reps’ selling time by 15 version tracking and storage of relevant RFP
to 20 percent, while increasing deal-flow content.
transparency and conversion.
— Post-sales customer journey optimization.
— Churn prevention. Scoring tools can create Robotic process automation and virtual agents
360-degree customer profiles automatically, can be used to reinvent the customer journey
leveraging variables such as buying patterns, and create a seamless online process for
interaction preferences, and web data to ordering, tracking, and query management. For
identify customers with the highest propensity example, this approach helped a B2B supplier
to churn. Compared to previous models based increase its customer-satisfaction score by 24
on simple analytics, machine learning triples percentage points and improve throughput by
the predictive power to identify churners. about 20 percent.
4 Sales automation: The key to boosting revenue and reducing costs
Web <year>
<article slug>
Exhibit <x> of <y>
Exhibit 3
Automation
Automationcan
cantransform thethe
transform entire sales
entire valuevalue
sales chain.
chain
Examples of the role of automation in sales
1. 2. 3. 4. 5.
Sales strategy Lead identification Configuration, pricing Order Post-sales
and planning and qualification and quotation management activities
Territory and coverage Automated workflow Automated proposal/ RPA-based receivables Cross/up-selling
planning for marketing RFP generation and payables workflow recommendations
Pipeline health and sales interaction
NLP-based inquiry SLA tracking Journey optimization
monitoring Lead evaluation and resolution
Smart workflows Product activation
Market intelligence prioritization
Discount manage- Customer billing Contract auto-
gathering via RPA Bot-driven lead ment workflow Inventory renewal
Customer profiling for engagement management
churn prevention
Structural support
RPA-based report generation/distribution
AI-enabled compensation management
RPA-based HR document generation (eg, offer letters)
— Product activation. Bots can prepare license machines working together to provide optimal
certificates for new customers and create service to customers. Companies should think of
emails that provide customers with license keys automation not as a replacement of their sales
to activate their purchases. Bots verify that an force, but as a powerful tool that complements
order is valid and update internal functions, such salespeople, rids them of low value-added tasks,
as finance and legal, about the activation. The and boosts their efficiency.
bot can save sales operations teams hundreds of
hours per year and enable customers to activate
their products much faster than before. How to deploy sales automation
successfully
So will the sales function of the future be fully To capture the benefits of sales automation,
automated? Not likely. According to MGI research, sales leaders must first recognize that, while
not all jobs are fully automatable, and our anyone can deploy sales automation and capture
experience in sales confirms this. In reality, the its benefits, those with standardized sales
future of sales will be characterized by humans and processes in place and colocated/centralized
Sales automation: The key to boosting revenue and reducing costs 5
Sidebar
Using the time gained from automation
According to McKinsey research, there is high correlation between the time sales reps spend with customers and sales productivity.
On average, high-performing sales reps spend 20 to 25 percent more time with customers than lower-performing reps. Companies
that standardize and automate non-customer-facing activities, such as administrative tasks, free up time for activities that directly
drive performance, such as opportunity identification, negotiation preparation, and customer interaction.
sales support functions usually capture bigger sales function; best-in-class solutions can help
benefits from automation and see impact faster complete this task in a few weeks.
than their peers. This is because their costs for
data integration, technological deployment, and — Phase 2: Implement prioritized use cases. This
change management are lower. phase involves comprehensive process review
and mapping in prioritized areas. It is typically
Similarly, an extensible customer relationship conducted in three steps:
management (CRM) system² and a consolidated
IT stack usually help enhance the scalability of • Step 1: Eliminate activities that don’t add value
automation solutions. The leaner, more simplified, from consideration
and more digitized the internal sales processes,
the faster basic automation (RPA) can be • Step 2: Standardize processes with colocated
deployed and more advanced solutions, such as sales support and consolidated data
machine learning and cognitive agents, can be repositories
implemented.
• Step 3: Automate manual, time-consuming,
Finally, companies should select an and repetitive tasks.
implementation approach that reflects their
starting point, the structure of the sales — Phase 3: Scale-up. Companies should not
value chain, the competitive landscape, and seek to automate the entire sales function
customer preferences. In our experience, a full at once. Successful players take a wave
implementation journey typically takes 12 to 18 approach, creating a pilot to test and refine new
months, with impact from prioritized use cases processes, starting with the most promising and
within six months. It comprises three phases: least critical applications. Automation teams
should work closely with sales reps and sales
— Phase 1: Quantify automation potential and support staff to make sure their experience
prioritize opportunities. A team of experts and expertise is reflected in the system, both to
quantifies the automation potential by subtask create buy-in and hedge against risks.
and prioritizes use cases across the entire
2
In this context, “extensible” means “designed to allow the addition of new capabilities and functionality.” For details, see Niklas Johansson and
Anton Löfgren, “Designing for extensibility: An action research study of maximizing extensibility by means of design principles,” May 29, 2009,
University of Gothenburg Department of Applied Information Technology, gupea.ub.gu.se.
6 Sales automation: The key to boosting revenue and reducing costs
For automation programs to be effective, operations, the COE drives the implementation
salespeople need to work differently. Change of automation. It’s important to ensure that
management involves training reps and managers; the teams driving sales automation consist
tracking impact via key performance indicators of members with skills ranging from general
(KPIs), time saved, or the monetary value of bot- management to technology and analytics,
enabled customer conversion; putting in place combined with relevant process domain and
appropriate incentives; and communicating with all customer journey expertise.
relevant stakeholders. Best-in-class companies
train sales reps both in workshops and in the One technology company used this approach
field. As manual tasks are reduced, leaders can to build a comprehensive ticketing system for
increase productivity targets and incentivize assigning sales tasks automatically to either
reps based on customer-oriented KPIs, such as human sales reps or bots. Key central sales and
revenue growth or acquisition rate. A periodic sales operations functions were colocated with
communication cadence should be established the automation team to improve efficiency.
to engage and inform reps in “townhall” meetings.
In our experience, change management is a The team explicitly developed a rollout
crucial catalyst of success. In fact, 90 percent of program with sales reps to build their trust and
companies that successfully scale automation capabilities as the effort proceeded, starting
invest more than half of their budgets in change with noncritical processes (market intelligence
management and capability building.³ gathering and pipeline monitoring enabled by
RPA) and advancing to more critical processes
The most effective model for delivering automation (pricing recommendations supported by ML) in
includes an automation center of excellence later waves. Use cases were prioritized based
(COE) that provides enterprise-wide AI tools and on ticket volume, length of the process, and
expertise to guide the automation agenda. A sales- potential impact.
specific hub reporting to the head of sales or sales
3
Michael Coyne, John Larson, Jessica Shieh, and Hyo Yeon, “Winning in automation requires a focus on humans,” December 2019,
McKinsey.com.
Sidebar
A day in the life of the sales rep of the future
In the morning, the rep receives an automatic update on priority customers. In a conversation with a given customer, the rep
uses automated proposal generators to respond to an RFP, with terms and conditions approved within minutes. Returning
from the customer site, the rep scans the order, and the contract is uploaded into the system. Key stakeholders, such as
manufacturing, finance, and customer service, receive copies of the order. As the order is shipped, the invoice is generated
automatically and sent to the customer with the sales rep in cc. The customer and sales rep can check the order status online at
any time. Automatic notifications are set up to alert the customer in case of unforeseen delays.
When the sales rep starts the videoconference with the next customer, a notification on critical talking points, such as the fact
that the customer’s order profit margins are falling below a preset limit, is sent to the sales rep’s tablet.
Sales automation: The key to boosting revenue and reducing costs 7
All data was then integrated into a central ticket With automation, everybody wins. Customers will
repository that served as the single source benefit from faster turnaround. Companies will
of truth. The ERP system was augmented benefit from higher sales-force productivity. And
with custom solutions that powered the bots. sales reps will experience greater job satisfaction
“Customers are amazed by the responsiveness. because automation lets them focus on what they
The bots resolve many issues in as little as two love: delivering value to customers.
minutes,” a CRM manager says.
Manu Bangia is an associate partner in McKinsey’s London office, Gui Cruz is an associate partner in the New York office,
Isabel Huber is a partner in the Munich office, Philipp Landauer is a partner in the Stuttgart office, and Varun Sunku is a
knowledge expert in the Marketing & Sales Practice in the Amsterdam office.
The authors wish to thank Pedro Assunção, Mathilde Castet, Michal Cieslikowski, Richelle Deveau, Wyszomir Janikowski,
David Levitch, Ewelina Marcinkiewicz, Clemens Rengier, Siamak Sarvari, Cristiana Torres, and Rob Whiteman for their
contributions to this article.
Copyright © 2020 McKinsey & Company. All rights reserved.
8 Sales automation: The key to boosting revenue and reducing costs
