What It Means to Measure a Sales Process

You’ve heard it a thousand times: “What can’t be measured can’t be improved.” Yet when it comes to marketing and selling processes, measurement can be a frustrating mess.

Most people, who grew up in the culture of sales and marketing, including the authors of most books on the subject, do not believe sales and marketing can, or even should, be measured. To them, measurement seems like a geeky exercise, a waste of time.

As a result, the marketing and selling functions of most businesses are without usable measurements, and their management teams don’t realize it. They may have tons of data around costs and orders, but they are pretty naïve when it comes to understanding what drives those costs and what drives those orders.

Process improvement requires that you go first to principles: you have to trace the meanings of words and phrases back to facts in the real world. This is especially true in sales and marketing, where the most important facts are those that drive customer’s actions. And the most important measurement system is the one that tracks whether customers are taking actions that lead toward a transaction with your company. This is simultaneously known as “the sales process” and “the Customer’s Journey.”

What kind of information do customers look for when they realize they have a problem that needs to be solved? What kind of interactions would they appreciate as they grapple with their situation? What distinguishes people who are “just looking” (for information) from those who are ready to buy something now? This is the kind of knowledge that makes or breaks companies. It is knowledge of a market, something far more useful than “knowledge of marketing,” which is why it is so crucial to measure it.

A Reluctant Sales VP’s Own Logic Provides a Process Approach

Once I was hired by a CEO who heard me speak about the possibilities of measuring marketing and selling activities and results. He was tired of spending millions on marketing to provide thousands of leads to his distribution channel and then never hearing about those leads again. He sensed there was waste, but couldn’t put his finger on where or when. A key problem was his Sales VP, Charley (not his real name), who was a great performer, yet resisted analyzing things with every breath.

Once we got Charley talking, he actually showed many good insights into his market. By carefully arranging his “business plan” on a flow chart, we helped him develop a diagram he was happy with, and one that could also be used as the basis for some rudimentary process structures and even some measurements. That discussion worked partly because of Charley’s savvy insight into what really motivated his customers, distributors, and salespeople.

The rudimentary process map we developed with Charley broke a log jam between the CEO and the marketing and sales department, because it facilitated a productive conversation about what types of resources they needed and what kinds of results they could be accountable for. To Charley’s surprise, those discussions led to decisions that streamlined his salespeople’s workloads around cooperative advertising and special pricing. He had expected a process approach to increase administrative requirements rather than reduce them.

The bad news was that Charley, for all his brilliance, still had some blind spots. For example, he held strong preconceptions about the right way to use media advertising and the pointlessness of measuring anything. He was convinced that he already knew the answers. It seemed likely to me that unless we could get Charley to listen to data that came from the process, he wasn’t likely to learn any more than he already knew.

This illustrates the problem with weak approaches to the sales process: they do not get down to observable facts. Instead of identifying what observable facts are meant by words such as “lead” or “qualified opportunity,” they make assumptions. Instead of setting up a mechanism for counting and analyzing these observable facts, weak sales processes rely on more guesses and more assumptions.

Getting Salespeople to Request Better Record Keeping!

Here is an example that illustrates a different aspect of this same problem: Executives who bring my team in to improve their sales processes often warn us that we might find resistance among members of their team. They are often speaking from experience: their own attempts to lead process improvement generated very real resistance. Their people pushed back because they didn’t see the value of doing all that measurement work.

However, when we interview those team members, we ask about their customers, what challenges and problems they were having, and where they think the marketing and sales bottlenecks are. Generally, they become very engaged in the discussion and readily agree that improvements are needed. Often they are the ones to point out that gaining those improvements will require more careful record keeping and analysis of what exactly has been going on. In fact, they often become excited about the prospect of making something new and better happen.

Now, of course, sometimes an outsider like a consultant is treated differently than an insider is. Yet still, why would that happen so regularly? I think it is because of the assumptions we all have; assumptions that not just our sales and marketing have, but also the meaning of the term “measurement.”

Once people realize that measurement is a means of “figuring out how to find more of the people who are going to buy now,” it no longer becomes boring or geeky or pointless. It becomes their bread and butter, the way they make money.

Michael J. Webb
August 13, 2007