SPIF Tip #26: Reason Cures Stagnant Sales Productivity

Recent sales productivity

research attempts to provide insights to help companies improve. It points out the “stark disconnects between what management sees/does and what reps want/need.”

The culprits? Disconnects between the aims of marketers and sellers. Inability to measure the impact of improvements. And the absence of quality/effectiveness measures. In other words, it’s the same old story.

In the 1800’s scientific approaches dramatically transformed medicine. Unfortunately, modern management has not yet made this transition. Sales productivity is stagnant because most executives do not apply scientific reasoning to sales and marketing. Yet the basics of doing this were laid out by W. Edwards Deming many years ago.

Understanding variation

• Customers and sales opportunities (not to mention salespeople) vary in many, many ways. What, exactly, is an ideal customer? A qualified sales opportunity? To avoid wasted time and resources, these must be defined. That means referring to specific observations in reality. Unfortunately most businesses don’t consistently do that. As a result, their words (and their sales and marketing efforts) float unconnected to the problems at hand.

To be fair, Deming was referring to statistical variation. Since he worked mostly in manufacturing, he took operational definitions for granted. That’s a big mistake in sales and marketing. Statistics are meaningless until they are applied. Like the doctor’s X-ray, they can make hidden factors quite visible when applied properly.

Systems’ thinking

• It is so easy to think “the sales department didn’t make its numbers, so there must be something wrong in the sales department.” That may be true, but it is also true that your company’s assumptions, policies, and culture comprise a formidable context built up over time. If that context makes it harder to give customers what they want, your salespeople will struggle.

In fact, struggling salespeople are a give-away something is wrong with your system. Is the problem in the market, the marketing, the sales force, or something else? Again, like the doctor’s X-ray, only evidence and systems thinking provide the context for proper diagnosis.

Method for learning

• Sales and marketing is a “blind men and the elephant” kind of problem. (Customers, opportunities, and salespeople vary in so many ways, remember?) Companies require an explicit method for identifying and classifying these variations across people and geographies so they can be properly integrated answer the question, “What’s the best way of achieving the goal? Ask yourself this: “If our managers are not following the Deming’s management cycle, what exactly are they doing instead?”

Like human bodies, businesses are complex things. When providing potentially dangerous treatment, doctors expect you to come in for a follow up examination. When operating on your own business, you should do no less.

Respect for people

• People will not continue to sacrifice their interests to the corporation for long. Instead, they should be willing participants in a relationship based on trade. The business offers them many things – a chance to stand out, gain experience, to learn, to be part of a respected community, and much more (not to mention a paycheck!). In return, the business gets the only resource capable of identifying and adapting to reality.

A scientific approach is the cure for stagnant sales productivity. If you’d like to see how your firm stacks up, take the World Class Sales Process Self-Assessment.