Sag should be 25% to 30% of the total suspension movement up and down.
If the total suspension movement (front or back) is say 4" then when you sit on the bike in your normal gear, it should sag by about 25% to 30% ie about an inch!
If it sags 2" (half it's movement) it's too soft (50%) then you want to wind up the preload.
If it sags 1/2" ( an eighth of its movement) it's too hard (12.5%) so you want it with less preload
THEN you need to set the rebound damping... as little as you can get away with. Back it right off... right off. You'll probably pogo stick down the road so wind up the rebound a couple of clicks.
If the bike rides back end down then you have too much rebound ... the spring doesn't 'recover' before it hits the next bump, so remains partially compressed. If it boing boings down the road then another click or two on the rebound should sort
BUT the normal BMW suspension fitted as standard aint good enough in reality and a click here and a click there won't make much noticeable difference. Fit good aftermarket suspension such as Ohlins or Wilbers and you can then fine tune and tell the difference.
Good suspension is worth 20 bhp