Last year I was wearing one of those Fitbit wristbands so I could count my steps on a daily basis. When a colleague of mine in Europe noticed it, he asked me; “Why are you American’s so obsessed with measuring things?”
The answer I gave was; “If you can’t measure it, you can’t improve it!”
As my many readers of this blog are aware, Pinnacle Sales is all about continuous improvement. This leads me to the discussion of metrics in sales. Counting, calculating, valuing effort in the sales process isn’t much different from determining effort on a production floor. For a machine you can measure; cycle time, floor space, amount of electricity used, and many other factors. For a machine operator, you can measure; parts per hour, defects, on-time orders, and even 5S his factory space.
If any of those calculations are out of balance, or not meeting standards steps are already in place to correct them. This is called an OCAP (out of control action plan).
What is the version of a Sales OCAP?
The most often used methods to value sales people are total sales, or total margin for an account or region. There of course are also things like closing ratios and number of contacts per period. Most of us know all the formulas to calculate the answers. Management, training, and coaching come in when you find a gap between a great performer and an average performer.
- Do you know how to correct this?
- Do you know how to find the main cause of the problem?
- When you correct the problem, do you test that method?
- Can you turn the problem on and off?
Having spent a lot of time selling manufactured goods, I have learned quite a bit about problem solving. There are numerous methods in finding causes, ranging from 8D reports to 5-Why’s.
The sales profession is no different from an operations group. Finding out the root cause, and putting in permanent corrective actions is a manager’s responsibility.
- How are you evaluating your sales team?
- Where are their gaps in performance?
- What are the possible causes?
- How can you correct them?
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