Feb 26, 2013 | Change, Management, Sales
Sales, or as I prefer to call it, “Revenue generation” is the core of every business. No sales, no business. However, the thinking around performance assessment and management of sales is generally pretty superficial.
The demarcation of sales and marketing has also changed enormously with the collaboration and automation marketing tools that have emerged over the last few years. Cold calling is dead, replaced by an array of digital tools and techniques which are generally managed by marketing personnel.
Sales performance is under the microscope, and rightly so as it consumes significant resources, and provides the cash upon which survival depends. Why is it then that the measurement of sales has not evolved to the level of sophistication displayed in other functions.?
My thesis is that the obvious measures have been pretty effective to date, and are simple to use, so little thought has gone into it.
However, for the future, the old tools are not enough, so here is a shot at a framework with 3 axes that seek to acknowledge the huge changes that have occurred in the last 10 years
1. Management of the sales pipeline. There are three basic measures of the pipeline,
- The number and type of opportunities
- Value of those opportunities
- Progress through the pipeline, including the drop-out/re-introduction rates, velocity, closure times, resource consumption rates, and most importantly, conversion rates.
2. Where do the dollars go, and what are the returns. The granularity of the management here is simply a function of where the value is. In large businesses with a widely spread sales force, the detail can be extraordinarily useful as a management and motivational tool of both the way people spend their time, and what they spend their time doing.
3. Sales force optimisation. have the right people doing the right things, in priority order. Pretty simple, except that:
- we are dealing with people, and each one should be managed individually. I have never seen a salesforce that is not a mix of personality and work styles, matching the job to be done to the person is an art that comes only with experience.
- Ensuring execution of strategy at the coal face, where the fancy words, clichés and metaphors hold no water, and what counts are the real personal interactions that occur.
Feb 20, 2013 | Change, Communication, Social Media
Nearly 500 years ago, March 1517 to be exact, Social media was born, and rapidly demonstrated its power. On that warm spring day, Martin Luther “posted” his list of “95 Theses on the power and efficacy of Indulgences” on the local social media site, the church door, and inadvertently started a movement that would split the church. His individual action was just a single one, protesting at the aggressive marketing of Indulgences by church authorities, but to have the effect it did, required a whole bunch of other things to be aligned to take off. Similarly, the self immolation of shopkeeper Mohamed Bouazizi in Tunisia in 2011 focused the unrest in Tunisia , that led to the replacement of the Tunisian dictator.
Martin Luther was outraged that locals could buy “indulgences” sold by church clerics, which acted as paid confessions, removing the ritual of the confession and contrition, and wanted to stimulate a debate at the university on the topic. What happened is that a local printer who had one of these new fangled printing presses reproduced the 95 theses, and sold them, rapidly creating a movement that had all the hallmarks of a modern social media movement.
As Clay Shirky tells it, there are three conditions that lead to a social media led change:
Everyone knows the system is broken
Everyone knows that everyone knows the system is broken
Everyone knows that everyone knows that everyone knows the system is broken.
When you get to this third level, it all blows up apart, and that is exactly what happened in Germany in 1517, and again in 1989 when the wall fell, in Tunisia in 2011, and is still rolling through the Arab world.
The tools of social media have changed, but the nature of human activity and collaboration has not. In the 21st century we want the same things our forebears wanted, and are prepared to fight for them, it is just that the tools are a bit different.
Feb 12, 2013 | Change, Communication, Innovation
The next big wave of innovation just may be co-ordination services.
When you think about it, the web has given us huge amounts of data at our fingertips, but created the problem of dealing with all the options we have. Usually we want only a very few options from which to make a choice, the more tailored those options are to our needs, the better, but we are now being deluged.
Think about the co-ordination of travel needs of inner city residents and transport. Often they do not need a car much, but when they do, a standard rental is not always convenient. Enter Zipcar. Travel planning is made easier by the on line room booking systems, AirBnB co-ordinates those plans with the needs of owners of non hotel facilities that people may like, and a bit of extra cash. The list goes on.
The current “scandal” of horsemeat in Findus products in Europe, and the Jindi cheese Listeria recall in Australia highlight the frailties of food safety sensative supply chains. We have the cpability to make the whole chain absolutely transparent, every product traceable, and if we used it, the problems would be gone. The challenge is the collection, analysis and delivery of the data, co-ordinated with the need for the data.
Co-ordinating and organising all this data, seamlessly, instantly, across all your devices and locations should be a fertile field of innovation.
Feb 11, 2013 | Change, Governance, Leadership, Strategy
How often do we hear that we learn more from our failures than our successes, that if we do not fail sometimes, we have not done enough, and that an innovative, exciting culture embraces failure? Thomas Watson Senior, creator of IBM once said “the fastest way to succeed is to double your failure rate.”
So how is it that we rarely see failure really celebrated if it is so productive? Such celebration is very rare in my experience.
An Canadian NGO, Engineers Without Borders has broken the mould, and published their “Failure Report” and attracted considerable attention, this article in the Guardian outlines the background.
How brave is that?
NGO’s depend for their funding from groups that you would expect to be pretty risk averse, they would hate to see their donations seemingly wasted, and admitting failure is on the surface at least, admitting to waste and potentially putting their funding at risk.
I wonder what would happen if Australia’s public companies were publish their own failure reports?
Rio Tinto’s foray into Aluminum , Harvey Norman missing the on line shopping revolution, Woolworths finally admitting Dick Smith had turned feral, James Hardie and asbestosis, Eddie and the Labor party, the list goes on. We get outside analysis, sometimes the entrails of failure are exhumed by legal processes, but never do we get the honest, gut-felt, reactions of those involved in the decision making examining their behavior, and taking responsibility for the failures. All we hear is the spin of the successes, and the message that the protagonists are all seeing, all knowing, who only act in the interests of others. Ducking of responsibility has become a management core capability, “I cannot recall” the last refuge of the villain.
How much better if we did as we say we should do, and celebrated failure as a part of the learning process, and that intelligent analysis of the reasons for failure, and the resetting expectations makes for a healthy culture.
Jan 31, 2013 | Change, Personal Rant
The good news is that at least part of the nasty, smelly, political wind coming our way in 2013 will be avoided by the Prime Ministers announcement yesterday of the September election date. The context of the statement, that she wanted to remove the uncertainty that accompanies an election date announcement, and allow people to plan for the year is nonsense. The only people whose lives are run by election cycles are the pollies and the befuddled bureaucrats supposed to do their bidding. The truth is that the loss of political initiative and flexibility afforded by being able to call the election at short notice, is outweighed by the costs of continual leadership speculation, the ugly spectre of by-elections labor would certainly lose, and the value of being seen as trying to be positive about the long term, and sensible policy development.
The bad news. This current shambles of a government will probably be replaced by the largely invisible, talentless, non entities of preening self indulgence that currently inhabits the opposition benches. The only one of them who appears to be able to make an intelligent argument, supported by facts, logic, and wit is Malcolm Turnbull, who it seems will struggle to keep his vitriol in check in the face of the rampant “ordinaryness” of his party and coalition colleagues.
Where are the John Buttons, Fred Dalys, Peter Walshs, Paul Keatings, Tim Fischers, Lindsay Tanners, and Jim Killens of past Parliaments when you need them. (most of these examples from my memory seem to be Labor???) Like them or not, agree with them or not, at least you knew they stood for something, what it was, and they were prepared to openly debate the merits with facts, listen to divergent views, and set out to turn them around through adult conversation and debate, albeit laced with humor, sarcasm and irony.
It is going to be a very long year!
Jan 30, 2013 | Change, Marketing, Small business
I wonder how anybody could be in the slightest bit surprised that Coles and Woollies are raking in the profits from petrol retailing, as has been reported recently.
We have allowed a virtual duopoly to emerge and duopolies behave in pretty predictable ways, for the benefit of shareholders, that is the way the system works. Oh, you will not be able to nail collusion, or any of the other nasty anti competitive behaviours on them, probability is they will not be happening, as they are not necessary with a duopoly, simple self interest will drive profitable behaviour. The opportunities to cross merchandise, cross promote, and leverage operational logistics costs that exist just enhance the attraction of it all.
The scale of the major enterprises makes competition from local businesses a huge challenge. Pundits like me can wax on about the opportunities the small agile enterprises have, how the net has given them the flexibility and transparency to take on the big guys, but when it truly is David Vs Goliath in a local market, the little guy will rarely win. He will be swamped by the “man” who can simply ignore as a short term irritation the slower traffic, lower basket value, squeezed margins, and any resident reaction that occurs, that would mean death to the smaller operation.
I feel for the small guys who have made a huge effort to compete, but being in a commodity market means that scale counts, and in the petrol market, Coles and Woolies now own it, as they do groceries and hardware, with office supplies evolving down the same path. I bet they cannot wait to get their hands on the still regulated pharmacies and newsagents, where the regulation has enabled a cosy club for small businesses to exist.
