According to legendary quality expert W. Edwards Deming, there is one critical, but often overlooked, factor upon which success in almost any business endeavor depends. The ability of your sales team to meet and exceed your revenue targets will be determined largely by your awareness, or lack of awareness, of this one thing. It amazes me how many companies neglect it entirely, focusing instead on individuals and performance issues while the real problem goes unnoticed and unaddressed. Obviously it is vital for you to understand this important component and learn how to manage it properly so that you can unlock the full potential of your sales organization.
According to Dr. Deming, the critical component is your system, or process. For the purposes of our discussion, we?ll be focusing on the process that has to do with generating sales?your selling process. In my experience it doesn?t matter how talented, educated, or experienced your salespeople are, or how hard they work at it, there remains a very large gap between the actual results they will produce and the results they could have produced had someone been paying attention to process. In today?s ultra competitive business environment, where the margin between winning and losing is so slight, I am surprised at how many companies continue to ignore an area that holds such potential for drastic increases in productivity and bottom line results.It?s easy to say that your salespeople could be producing better results. It?s not so easy to actually demonstrate it and then formulate a workable plan to do something about it. Most managers would agree there?s always room for improvement. The challenge lies in knowing where to look in order to find the weaknesses in the selling process that are holding your people back. It?s hard to stop the bleeding when you can?t find the cut?or worse yet?when you don?t even know there?s a cut. Most companies don?t even know where to start. In that sense, it?s easier to manage people than to engineer process improvement. It?s always easier to treat the symptom than to actually diagnose and treat the underlying cause. The result is a selling environment where the true reasons for most mistakes and failures go unaddressed and are blamed on people instead. Companies who operate this way often find themselves grappling with the same basic problems year after year with the only change being the people doing the grappling. It?s an ineffective and expensive proposition, certainly much more so than teaching your sales managers how to apply the principles of Sales Process Management.
Sales Process Management (SPM) promises to do more than just identify and improve the weaknesses in your selling process. Another major benefit you will enjoy when you make the commitment to SPM is seeing the best practices in your selling process identified and duplicated across your entire organization. I?ve heard many leaders talk about implementing best practices but have seen very few of them actually manage to consistently achieve it.
I first stumbled upon the benefits of SPM a few years ago when I was on the other side of the management fence selling online recruiting solutions for a major Internet company. The Internet bubble had burst and the economy was starting to slow down. As a result, our prospects and clients weren?t hiring at the same rapid pace as they had been before.
Sales started to slump. Salespeople who had always hit their numbers were now coming up short every month. Management focused immediately on inspecting and monitoring the individual performance of the salespeople. The decision came back that we were not making the necessary number of daily sales calls. A resolution was made to mandate ratcheting up the activity levels on the floor. If we failed to make X percent more dials every day we could be penalized or otherwise punished. Incentives were introduced to reinforce and reward the required behaviors.
Employee morale plummeted. Salespeople expressed concern that management was unfairly targeting them for blame. Management expressed concern that perhaps many salespeople had been taking advantage of the situation during the good times and didn?t really care about the company, or, worse yet, were lazy and needed to be weeded out. The mandate had its intended effect? at least on call volume. The average number of daily sales calls on the floor did increase dramatically. Unfortunately this increase in the number of sales calls did not result in a corresponding increase in sales and revenue.
During this time, my focus was on finding something that would work to produce measurable results for me. Initially I ratcheted up my activity levels too. In order to accomplish this I began coming in early and staying late. After a few months of this I noticed that although I was working harder and longer, and sacrificing time with my family to do it, I wasn?t seeing any appreciable return on my investment of additional time and energy. I began to realize that I wasn?t addressing the real problem. The market had changed dramatically while my sales process had remained the same. I was doing the exact same things I had been doing when the market was hot. The only difference was that I was now doing a lot more of them.
I began to analyze how the marketplace was different now and to think about changes I could make to my own approach and what the results were likely to be. Unwittingly I was applying SPM to my own selling process!
I recognized that during the time the economy had been booming almost every company seemed to be hiring. A salesperson could just pick up the phone and dial a prospect (seemingly at random), and chances were that they would be hiring or could refer you to someone who was. I had always kept data on the number of sales calls I was making and the results and success ratios my efforts generated. The data showed that before the bubble had burst, nearly one in three of my sales calls resulted in a lead. It was the perfect market for making as many sales calls as you could possibly fit into the day.
The present situation was very different. I was now making almost 30 dials, on average, to get to that same lead. I did the math and found that increasing my outbound sales calls by the suggested 50 percent wasn?t going to get me even close to where I needed to be. I would have needed almost a 1000 percent increase in call volume to come close!
Another difference was that, whereas during the boom, I could approach a prospect without specific knowledge of their business or hiring plans and effectively communicate using very general terms, now, leads were so few and far between that I needed to have a more thorough knowledge, and a specific, customized solution prepared in order to engage the prospect in any kind of meaningful discussion. Each lead was too rare and too valuable to risk losing on a random, generalized cold call.
I concluded that I needed to change my selling process from one in which I was making a higher volume of random sales calls, to one where I was making a lower volume of more targeted inquiries. Talk about flipping conventional wisdom on its head! I couldn?t argue with the numbers, however, and, after some initial hand wringing, my manager couldn?t either. He agreed to let me try out my new process.
The new approach began to yield results immediately. I was opening up far more new cases than ever before and my sales numbers jumped up higher than they had been when the economy was booming! I began to apply the same thinking to every process I was using.
First, I would identify all of the activities within my current selling process. Then I would analyze each one to try to understand its true importance to advancing the sale and producing the intended outcome. Whenever possible I would look for patterns and ways to measure the cumulative results of each activity or behavior. I soon found that by taking the time to isolate and understand the role each activity played within the context of my whole selling process, I could better reason from cause to effect and more accurately pin point the relative strengths and weaknesses of each. The result was a sort of behavior pattern algorithm that told an accurate story of my process from beginning to end.
After gaining an understanding of exactly what I was doing and how each component of my process contributed to the outcome I wanted to achieve, I would look for ways to improve upon my results. I would repeat this process over and over again; continuously looking to identify inefficiencies and replace them with new, improved ways of doing things better. Often the improvements would come as a result of talking with and observing other top performing salespeople. Now that I knew what I was looking for, I could more readily identify what others were doing differently in the same area that was allowing them to perform at a higher level and immediately incorporate it into my own process.
The results were immediate and dramatic, enabling me to finish 2002 as the top telesales rep in the entire company. Since then, I?ve successfully introduced SPM to my clients and to my own salespeople and have never seen it fail to produce the same outstanding results. SPM is easy to implement and works in any situation, economy, environment, industry, or company. It will work for you too.
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