Think about a company’s performance across functional groups. If manufacturing produced defective circuit boards, or accounting produced quarterly reports that didn’t accurately reflect their financials, or the company’s internet/intranet’s connection was spotty at best … would this get the attention of the entire C-Suite; especially the CEO? You bet it would.
What about the sales organization? How can sales deliver a forecast to these very stakeholders, that according to recent studies, has a win rate of forecast deals and the associated revenue of less than 50%.
Sales forecast impact several of a company’s investment decisions. Consider the impact of an unreliable forecast.
· How many new-hires will the company really need to support the projected business growth?
· Will there be the cash flow to invest in capital expenditures?
· Is now the right time to expand into a new geographical market?
· Will we be able to fund new product development?
In a nutshell, the forecast allows companies to accurately allocate resources for future growth and manage its cash flow. Why is the sales forecast, the very means by which a business makes important decisions, not on par with the standards of manufacturing, finance, or IT?
Could it be that sales have long been considered part art and part science? And therefore, there isn’t a means by which to bring rigor, discipline, standard processes, and measurable results to the sales organization?
What about Six Sigma? Could Six Sigma help B2B sales organizations much in the same way it has reduced defects and brought predictability to manufacturing, finance, IT, etc.?
If Six Sigma standards were brought to the sales function, the single most measurable input of the sales production process would be the sales call and the . Regardless of the product or service being sold, questions would be:
· How many calls did you produce?
· What was the quality of those calls? (your specifications)
· What did it cost you to make them?
· Who is inspecting that on the line? 1
If sales have good standards around what makes a quality call and everyone knows what those standards are and managers coach to those standards, companies will have good inputs (calls) on the front-end that directly impacts a predictable, highly competent forecast and pipeline.
The question with respect to Six Sigma in the sales organization becomes: Do sales leaders know the number of defects in their current sales process? Or, what’s working and what’s not working in their revenue generating department? In a recent CEO publication, there is a quote from a CEO who said, “If I put a dollar in a vending machine, I know what is coming out; however, if I put a dollar in my revenue generating department, I have no idea what’s coming out.”
The watchwords from this CEO’s comments are rigor, discipline, standard processes, and leading and lagging indicators that help create a predictable revenue generating department.
Can Six Sigma be applied to B2B sales? The answer is a definitive yes. Six Sigma is a method that provides organizations the tools to improve the capability of their business processes. Six Sigma is a natural fit for putting rigor and discipline in B2B company’s sales processes—from prospecting, to calls, to closing business.
In our Six Sigma Part II blog, we will discuss in more depth the leading indicators (activities and behavior) that will impact and add predictability to lagging indicators (sales results).
If you would like information on how ZZ Sales Systems can bring higher reliability to your sales forecast and help your company with sales performance improvements, reach out to: info@zzsalessystems.com
Tom Lazzaro Managing Partner 719-351-2415 tom@zzsalessystems.com Jerone Jackson Managing Partner 404-918-9524 jjackson@zzsalessystems.com About ZZ Sales Systems
We are a sales transformation improvements consultancy. We bring over 75 years of experience running sales organization and advising Company and Sales Leadership on their Revenue Growth Strategies.
Our offerings and solutions help build and sustain a successful sales organization that delivers profitable revenue and top line growth. Core deliverables include: Key Performance Indicators, Customized Sales Playbooks, Equipping Frontline Sales Managers as Coaches and Trainers, Salesforce.com Optimization, Productivity Tools, Advising and Consulting.
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