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Is Your Sales Process Lighting the Way or Shrouded in Mystery?

by Michael Webb | Comments (0)
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Many people believe that sales and marketing should be more organized, more accountable, and more predictable. This is much easier said than done, of course. In working with these organizations over the years as a manager, a leader, and a consultant, I’ve uncovered some patterns that you can learn from.                     

A Crucial Tool for Reengineering Your World

First, market conditions are requiring that sales and marketing functions themselves create more value for less cost.

Consider this simple example: search engines and a well-designed web page can provide information and administer ordering with the equivalent or better value than a good industrial distribution salesperson making cold calls 15 or 20 years ago, and at a tiny fraction of the cost.

Sellers and marketers are being forced to elevate their value: if a market has latent demand, enabling those transactions is a function that can largely be automated (reducing cost).

If a market requires educating prospects on their risks and rewards and learning enough about them to make offers that meet their specific requirements, well, that is value (creating demand). Some of it can also be automated, but a lot can’t, at least not yet.

To survive in this new world, companies must shift their thinking. That shift is very similar to the one Lean manufacturer’s must make: they have to shift from an internally oriented perspective to an external perspective–the customer’s. Ultimately, they must learn what the customer values (most don’t really know), and then they have to respect it.

Three Stages of Sales Process Maturity

Typically, organizations fall into one of three groups when it comes to their sales process. Most are in the first group, which is somewhat tribal in their approach. An increasing number have moved on to articulate their tribal knowledge and are struggling with its inconsistencies and weaknesses. I call this the “In name only” group. Finally, a small number have made the shift to an external perspective. Rather than repeating the words of their forefathers in the company, they base their thinking on the behaviors of their customers (evidence, facts) instead.

Here is a brief description of these groups and how you can recognize which one you fall into.

Tribal Stage

All human civilizations start out as tribes, so there is nothing to be ashamed of here. Tribes are led by chiefs (such as founders), and the chief’s view of the world is what matters if you are to stay in the tribe. In a healthy tribe, you might be able to do what you want if it gets results immediately, but if it isn’t working well or it takes a while before you can see any results, you better be doing and saying what the leader wants to hear or you are going to get some resistance.

An organization in tribal mode is easy to spot. Strangely, the selling organization may be blind regarding why the customer buys; its world view is simply defined by the fact that they buy sometimes. The focus of selling activity, naturally, is on what the seller is interested in: revenue. Implicitly, selling is what is “done to” the prospect. Typically, a few leading sales performers succeed through their relationships and/or personalities. Because this is difficult to duplicate, it can breed a command and control mentality or sometimes a Darwinian kind of free for all. Marketing in these organizations may be minimal or nonexistent and is generally product focused.

The result of this state of affairs is not necessarily bad. After all, when demand exceeds supply and the company is growing and making money, it is unusual for senior management to care about how things are organized in the sales department.

However, when the market swings to the other side and supply exceeds demand, this kind of organization is in for trouble. They have wide variations in people’s performance without the ability to understand why. Further, it can be hard for management to change the way the sales organization operates, much less its results. Salespeople can be quick to protect their freedoms and way of life. Forecasting in this world is difficult, if not impossible, in any scientific sense. Data and evidence (other than bookings and revenues) are basically nonexistent, because "reality" in these environments begins-and ends-with what the chief thinks is true.

Process in Name Only

Obviously, life in the tribe is difficult, and many companies rightfully attempt to make their world more rational and understandable. These efforts can improve the sophistication of the team’s language about their work and customers. When they are led by someone influential, such as the sales VP or the training department (with the sales VP’s blessing), they can have a positive effect.

You can often spot a company in this stage because they say they are “using Solution Selling, ™” or “Miller Heiman, ™” or have the stages of their sales process defined in their CRM, although not everyone really uses it in any case.

Although this stage is an improvement, it is still focused on what the seller is interested in. Yes, it is dressed in a structured sequence, and the training, tools, and process language can enable the team to be more coordinated. Although there may be more visibility into what stage prospects are in, salespeople (rightfully) will do what makes sense to them, regardless of the defined steps of the process. As a result, the process is “in name only,” and its value to the organization is limited. Marketing may attempt lead generation, but their efforts are not generally respected by sales.

In most other ways, this company is quite similar to the tribal organization. These Companies struggle mightily, because it appears to them that the problem is one of compliance (it isn’t, but that is what it looks like to them).

I’ve worked with many organizations to help them advance from “tribal” to this stage. We did elaborate process maps and even articulated the value of each stage to the customer. It was easy to attach such work to a sales training engagement or as a precursor to CRM. It feels good for a decision maker to decide how things should be and in a collaborative environment people even learn from these
types of exercises. Unfortunately, this approach doesn’t really change anything and thus produces little in the way of measurable payback.

The solution, as has been discovered in Lean manufacturing, is to look at the functions from the outside in: through the customer’s eyes. Staple yourself to a customer, and ask them what would capture their attention, get them to spend time investigating, cause them to opt-in, or take a salesperson’s call!

Evidence-Based Sales and Marketing

The key transition companies need to make is to ensure that everything they do to find, win, and keep customers actually creates value for the customer, with the evidence provided by the actions those customers/prospects take.

Clearly, not all prospects are ready to buy now. Many may not even be willing to investigate now, but they may be in the future. The key is to gear your interaction with the prospect so it matches whatever stage they are in (their stages are called the “Buyer’s Journey” or the “customer journey.”) As a seller, your tactics, such as generating opt-ins, first contacts, qualified opportunities, and so forth, should help the customer get to the next stage.

Contrary to the old school of “always be closing,” your initial interactions with prospects should be geared to generating trust, especially in business-to-business markets where there must be a relationship for value to be recognized. There should be little need to force prospects that are not ready to act. Instead, your process should measure your activities and their responses so you can get a handle on which tactics are effective and hopefully why. Marketing is not separated from selling. Instead, marketing designs and shapes when and where the selling occurs.

The result of this more evidence-based approach to sales and marketing is the ability to trace causes-and-effects and thus to hold people accountable for more of what they can control and less of what they can’t.

Being Helpful to Prospects Works Better

One of my clients uses call center agents (an entry level job) to qualify leads from their website. They had been holding these agents accountable for the number of calls they make and the number of qualified prospects they find.

Frustration with the department was high partly because the agents didn’t have the background to know whether a contact was qualified or not. Instead of holding them to this (what the client wanted but the agents couldn’t control), I recommended they provide coaching to help the agents establish a rapport and to give the prospect a reason to talk and share information. Then the agent’s performance could be evaluated more on the amount of good information they generated from the interaction. This works better, because the agents are more able to do it.

Evidence-based approaches produce more consistency in sales performance while providing insight into the causes of variation. On a plant floor, the language of quality enables people to characterize what they are producing (they can see, touches, and measure the materials they work with).

It is the essentially the same in sales and marketing. Money is spent generating leads, which are like raw material. Thus it pays to ensure that you also develop a language to characterize the quality of the leads and opportunities. Furthermore, it does not pay to put people in no-win situations (something which happens all the time in sales and marketing, unfortunately).

Once the quality of your leads and opportunities can be identified and recorded, management can gain the data to begin tracing the effects on the flow of leads and opportunities. Forecasts can be based on statistical analysis of the marketing and selling activities that actually generated them. Forecasts based on historical performance of a process step can become quite meaningful when the causes of variation start to be removed.

Conclusion

A properly defined sales process is the key to your company’s long-term (and possibly short-term) success. Such a process is your only means of linking the eyes and ears of the people on the front lines to the cold, hard data your executives should be seeing on the corporate dashboard.

Michael J. Webb
August 28, 2007

 

All human civilizations start out as tribes, so there is nothing to be ashamed of here. Tribes are led by chiefs (such as founders), and the chief’s view of the world is what matters if you are to stay in the tribe. In a healthy tribe, you might be able to do what you want if it gets results immediately, but if it isn’t working well or it takes a while before you can see any results, you better be doing and saying what the leader wants to hear or you are going to get some resistance.

An organization in tribal mode is easy to spot. Strangely, the selling organization may be blind regarding why the customer buys; its world view is simply defined by the fact that they buy sometimes. The focus of selling activity, naturally, is on what the seller is interested in: revenue. Implicitly, selling is what is “done to” the prospect. Typically, a few leading sales performers succeed through their relationships and/or personalities. Because this is difficult to duplicate, it can breed a command and control mentality or sometimes a Darwinian kind of free for all. Marketing in these organizations may be minimal or nonexistent and is generally product focused.

The result of this state of affairs is not necessarily bad. After all, when demand exceeds supply and the company is growing and making money, it is unusual for senior management to care about how things are organized in the sales department.

However, when the market swings to the other side and supply exceeds demand, this kind of organization is in for trouble. They have wide variations in people’s performance without the ability to understand why. Further, it can be hard for management to change the way the sales organization operates, much less its results. Salespeople can be quick to protect their freedoms and way of life. Forecasting in this world is difficult, if not impossible, in any scientific sense. Data and evidence (other than bookings and revenues) are basically nonexistent, because "reality" in these environments begins-and ends-with what the chief thinks is true.

Process in Name Only

Obviously, life in the tribe is difficult, and many companies rightfully attempt to make their world more rational and understandable. These efforts can improve the sophistication of the team’s language about their work and customers. When they are led by someone influential, such as the sales VP or the training department (with the sales VP’s blessing), they can have a positive effect.

You can often spot a company in this stage because they say they are “using Solution Selling, ™” or “Miller Heiman, ™” or have the stages of their sales process defined in their CRM, although not everyone really uses it in any case.

Although this stage is an improvement, it is still focused on what the seller is interested in. Yes, it is dressed in a structured sequence, and the training, tools, and process language can enable the team to be more coordinated. Although there may be more visibility into what stage prospects are in, salespeople (rightfully) will do what makes sense to them, regardless of the defined steps of the process. As a result, the process is “in name only,” and its value to the organization is limited. Marketing may attempt lead generation, but their efforts are not generally respected by sales.

In most other ways, this company is quite similar to the tribal organization. These Companies struggle mightily, because it appears to them that the problem is one of compliance (it isn’t, but that is what it looks like to them).

I’ve worked with many organizations to help them advance from “tribal” to this stage. We did elaborate process maps and even articulated the value of each stage to the customer. It was easy to attach such work to a sales training engagement or as a precursor to CRM. It feels good for a decision maker to decide how things should be and in a collaborative environment people even learn from these
types of exercises. Unfortunately, this approach doesn’t really change anything and thus produces little in the way of measurable payback.

The solution, as has been discovered in Lean manufacturing, is to look at the functions from the outside in: through the customer’s eyes. Staple yourself to a customer, and ask them what would capture their attention, get them to spend time investigating, cause them to opt-in, or take a salesperson’s call!

Evidence-Based Sales and Marketing

The key transition companies need to make is to ensure that everything they do to find, win, and keep customers actually creates value for the customer, with the evidence provided by the actions those customers/prospects take.

Clearly, not all prospects are ready to buy now. Many may not even be willing to investigate now, but they may be in the future. The key is to gear your interaction with the prospect so it matches whatever stage they are in (their stages are called the “Buyer’s Journey” or the “customer journey.”) As a seller, your tactics, such as generating opt-ins, first contacts, qualified opportunities, and so forth, should help the customer get to the next stage.

Contrary to the old school of “always be closing,” your initial interactions with prospects should be geared to generating trust, especially in business-to-business markets where there must be a relationship for value to be recognized. There should be little need to force prospects that are not ready to act. Instead, your process should measure your activities and their responses so you can get a handle on which tactics are effective and hopefully why. Marketing is not separated from selling. Instead, marketing designs and shapes when and where the selling occurs.

The result of this more evidence-based approach to sales and marketing is the ability to trace causes-and-effects and thus to hold people accountable for more of what they can control and less of what they can’t.

Being Helpful to Prospects Works Better

One of my clients uses call center agents (an entry level job) to qualify leads from their website. They had been holding these agents accountable for the number of calls they make and the number of qualified prospects they find.

Frustration with the department was high partly because the agents didn’t have the background to know whether a contact was qualified or not. Instead of holding them to this (what the client wanted but the agents couldn’t control), I recommended they provide coaching to help the agents establish a rapport and to give the prospect a reason to talk and share information. Then the agent’s performance could be evaluated more on the amount of good information they generated from the interaction. This works better, because the agents are more able to do it.

Evidence-based approaches produce more consistency in sales performance while providing insight into the causes of variation. On a plant floor, the language of quality enables people to characterize what they are producing (they can see, touches, and measure the materials they work with).

It is the essentially the same in sales and marketing. Money is spent generating leads, which are like raw material. Thus it pays to ensure that you also develop a language to characterize the quality of the leads and opportunities. Furthermore, it does not pay to put people in no-win situations (something which happens all the time in sales and marketing, unfortunately).

Once the quality of your leads and opportunities can be identified and recorded, management can gain the data to begin tracing the effects on the flow of leads and opportunities. Forecasts can be based on statistical analysis of the marketing and selling activities that actually generated them. Forecasts based on historical performance of a process step can become quite meaningful when the causes of variation start to be removed.

Conclusion

A properly defined sales process is the key to your company’s long-term (and possibly short-term) success. Such a process is your only means of linking the eyes and ears of the people on the front lines to the cold, hard data your executives should be seeing on the corporate dashboard.

Michael J. Webb
August 28, 2007

 

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