A fundamental assumption…
All professional sales reps, managers and executives are committed to the relentless pursuit of excellence.
Unfortunately, this statement does not apply universally. Even a less ambitious assumption – that all are committed to sustaining continuous improvement – might well be too aggressive. Be that as it may… Those who genuinely embrace either form of this outlook will find the greatest value in this book and its underlying Sales Process Engineering principles.
There is another key factor inherent in this assumption. That is the need for relentless, never-ending, methodical discipline. Discipline in critically and formally analyzing the weaknesses in your sales process and its execution is essential. The more discipline one can muster and maintain, the greater the value of these results and principles.
Please take the paragraphs above seriously. There are no silver bullets or quick fixes presented here. Be prepared to move outside your intellectual comfort zone. Those who do will be both humbled and energized by the potential for sales performance enhancement that’s out there.
The Need for Metrics
Most sales managers measure the effectiveness of their reps based on a single number – revenue production. Clearly, that is the key metric. By itself, however, it is woefully inadequate as a comprehensive management tool. Many sales managers, use 4 or 5 metrics, including things like calls made, proposals submitted, profitability and growth rate. A few use as many as a dozen or more. So, how many metrics of sales performance is optimal? Fundamentally, the answer is, “more than you have now.” Consider the following scenario…
You have just “volunteered” to manage a little league baseball team. Maybe you played the game yourself at age 10 or so, but assume that for the most part, you really have no idea what to do. (By the way, even if you really do know little or nothing about the game, the analogy will still be quite clear.)
One of your first tasks will be to decide on the batting order, the sequence in which the kids will step up to the plate and attempt to hit the ball. Having no metrics at all, a random decision is the only choice. That is, the success of your first management decision will be based purely on luck.
Change the scenario. Add a metric. Assume that you find a listing of last year’s batting average for each kid on the team. Now you know the percentage of time that each batter is likely to get a hit. You can now make a better batting order decision. One sensible approach would be to put the kid with the highest average first, the second highest, next, etc. That way, the best hitters have a greater chance at getting more turns at bat. Other approaches – based on your data – could also make sense. The point is, your decision is no longer random. Success in no longer based purely on luck.
Change the scenario again. Add a second metric. Assume you also find the percentage of time each kid actually got on base last year. (This is different than batting average. In addition to actually getting a hit, a batter can get on base by drawing a walk, getting hit by a pitch, or due to error made by a fielder on the other team.) You can now make an even better batting order decision. For example, put the kids with the three highest on-base percentages up to the plate first, second and third. Put the kid with the highest batting average up fourth. Doing so increases the odds that your best hitter will go to bat with three runners on base, thus increasing your odds of scoring more runs. One metric yields a better decision than no metrics. Two metrics yield a better decision than one.
The scenario can continue to change. What if you also knew each player’s stolen base percentage, runs-batted-in, extra-base-hit percentage… Each additional metric enhances the manager’s ability to make a better decision.
Now shift gears from your local Little League. How many metrics does a real baseball manager use? Major League Baseball’s web site (www.mlb.com) lists 109 distinct measurements of individual performance. (109!!!) Since both individual and team metrics are important, it’s really twice that, or 218. Also, in the real world, they consider right-handed and left-handed pitching, so it’s 436. Then you have day games and night games – 872. Then there are those other measurements that aren’t published on the web site… Then there’s X… Then there’s Y… You get the picture.
Big league baseball managers use literally thousands of metrics, along with the possible combinations and permutations. They do so because they are committed to excellence. They do so because their competition is tough. They do so because each additional metric enhances their ability to make good management decisions. Metrics help them predict what is most likely to happen on the next pitch, which in turn enables them to maximize the odds of having the right player in the right place at the right time, anticipating the right thing.
To further reinforce the point, consider Major League Baseball’s Oakland Athletics. Since 1998, they have been extremely aggressive in applying process engineering and statistical analysis to winning baseball games on a tight budget. Their total budget for player salaries is less than 1/3 that of the New York Yankees. ($57 million vs. $180 million) In 1999, Oakland ranked 11th of 14 in the American League in terms of total salaries paid to players and 5th in the number of games won. In 2000 they were 12th in salary paid and 2nd in wins. In 2001, 12th and 2nd again. In 2002, 12th in salary, but 1st in wins. In 2003, 12th in salary, 2nd in wins. The Yankees spent roughly $1.8 million for each of their wins. Oakland spent less than $600 thousand.
Not only does extensive, aggressive use of metrics produce excellent results, it also dramatically decreases the investment required to do so.
So back to the original question… How many metrics of sales performance really is optimal? Same answer as before, “More than you have now.” Every additional metric enhances the sales manager’s ability to make better decisions.
Focus on process!
People execute processes to produce results. Achieving consistent good results is more dependent on the process than on the individual executing it. In fact, the process is far more important.
If you get nothing else from this book, get that point.
Consider Henry Ford for a moment. Undoubtedly, he was a genius. He built his first vehicles by himself, assembling them one piece at a time. Having invented and produced a viable, low-priced car, he had two choices. He could either focus on people (by hiring and training high-priced folks with the wherewithal to imitate his own craft), or he could focus on the process of building cars (by thoroughly understanding, documenting and continuously improving his know-how).
His pool of potential talent for option one numbered – at most – in the hundreds. For option two it numbered in the tens of thousands. Henry chose option two. The result was an assembly line-based car production process and the ability to manufacture a massive quantity of high-quality cars at a reasonable cost. Further, he worked very diligently to create a legacy of capturing the flashes of brilliance from his employees, incorporating the flashes into the existing process and creating a cycle of continuous improvement.
Henry Ford became a household name because he focused on process.
Dell was a relative latecomer to the PC business. Today, Dell is one of a very few top-tier providers of PCs. Oddly, Dell is not at all proficient at building PCs. “Youngblood”, you say, “How can this be?” It is so because Dell focused on and got to be world class at a more relevant process than did its competitors.
If you happen to use a Dell, do you care that it was not built by them, but probably by SCI in Huntsville, AL? Of course not. You do care about how easy Dell made the process of configuring, ordering and getting delivery of the right hardware and software to the right knowledge worker at the right time.
Michael Dell became a household name because he focused on process.
The same focus-on-process concept holds true for any business, public sector, personal, artistic, athletic, individual or group process you can name. Take a minute and think about it.
While you’re thinking, notice a subtle difference between the two examples above. In the early 1800s, the idea of focusing on process at all was enough to create a huge competitive advantage that lasted for many years. In the late 1900s, it took a focus on the appropriate process that created marketplace leadership.
People are still important
Good, well-trained employees are still required to achieve success. Continue to read the self-improvement books. Continue to focus on learning more and more and more about sales techniques and tools. Continue to push your team to become a true “learning organization”. As an individual, learn all there is to learn. The more you know, the more successful you will become.
Just remember that the greatest sales rep in the world, using a poor sales process, will not progress beyond production of mediocre results. Conversely, an average rep can break the bank by using a superior sales process.
People are still important, but it is good process that creates the real leverage.
Sales is a process
The goal of this book is to help you and your company to sell more faster. The strategy to do so is to provide a roadmap to get you started down the path of Sales Process Engineering. Sales is a process. It is far more than a polished, professional sales call delivered by a product/service expert who also understands the prospect’s needs, potential applications, industry and internal operations. (…not that you don’t need all that…)
Sales is a process, just like manufacturing, distribution, financial management and purchasing are processes. The traditional rep who wants to be given product/service training, a few brochures and then to be left alone is a thing of the past.
Like any other process, an in-depth understanding of your sales process is essential. Like any other process, its linkages to other internal and external processes must be understood.
Creative Discipline
Think about those two words for a minute… Think about how they represent conflicting concepts.
Creativity – the hallmark of the right-brained free spirit; freedom from the constraints of bureaucracy; independence; the ability to see and articulate the big new picture. Without it there is no progress.
Discipline – the hallmark of the left-brained engineer; methodical execution of the scientific method; adherence to mathematical standards; control; the ability to repeatedly produce identical results. Without it there is no progress.
The fact is, both creativity and discipline are pre-requisites for progress. One without the other simply does not work. All of the heroes in history – be it philosophy, government, sports, music, inventing, politics, the military or business – demonstrated “Creative Discipline.”
Most of you reading this book are in a sales role. Most likely your DNA makes you very comfortable with doing creative work. That’s why most people get into sales to begin with. For us sales types, however, the discipline stuff is not so comfortable. Rules and procedures cramp our styles and seem to interfere with our effectiveness. Down deep though, we understand the need for repeatability, and appreciate the value of discipline.
For that reason, the focus of this book is on the discipline side of the coin. Not that the creative side is unimportant. Quite the contrary; it is essential. Much, however, has already been written about the creative, “dolphin-like” aspects of sales discussed in the preface. There is not too much that addresses the need for “cow-like” discipline.