How Do You Improve Sales Efficiency?

Sales efficiency is net new ARR divided by sales and marketing spend. Three things move it: the share of worked deals that close, the revenue each closed deal actually carries, and the amount of capacity spent on deals that never resolve. Everything else is downstream of those.

Stop paying for pipeline that will not close

ORM sees 10% or more of pipeline sitting untouched for twelve months at a typical customer. That inventory absorbs review time, distorts coverage math, and produces nothing. ORM treats a change in stage, close date, or amount as meaningful activity, and an opportunity with none of those over a long window is not a deal.

Apply an aging rule and enforce it. ORM runs a twelve-month rule with most customers, grouping opportunities with a machine learning model and predicting a close curve for each group. Those curves run from 1 to 80 weeks, with most of the expectation landing before week 12 and very few groups carrying expectation past 52 weeks. A deal past its group's curve is a decision, not a forecast line.

Protect realized deal size

The efficiency numerator is booked ARR, not CRM ARR. ORM's position is that most deals close for less than the value carried in Salesforce. A pipeline showing an $80,000 average deal size against $40,000 in average closed won value is the shape of that gap. Every point of unmanaged discount lands directly in the ratio.

Two mechanisms compress realized size. New competitors entering the market create pricing pressure, and pulling deals forward from future quarters usually costs discount plus the future quarter's revenue. The second one is self-inflicted and shows up as a good quarter followed by a bad one.

Raise win rate before touching the budget

Win rate is the cleanest lever because it changes the numerator without changing the denominator. Work the two inputs that respond fastest.

Earlier disqualification. A no-decision outcome costs the same rep hours as a win. Tighter entry criteria convert that capacity into worked deals that resolve. Close date discipline. The strongest slippage signal ORM finds is a rep changing the close date, and a deal that slips one quarter is less likely to close even when it sits in commit. The earliest signal is absence: no activity, no field changes, no notes. Treat silence as a stage, not a gap.

Measure it where the spend lives

Company-level efficiency averages segments with different economics and hides the one that is failing. Split the ratio by segment, then by channel, then by rep tenure. Fix the weakest cell rather than the blended number.

For the underlying inputs, see win rate and deal slippage. For the forecasting practice that keeps the numerator honest, see sales forecasting best practices.