Ed. Technical difficulties! OMG, we’ve had technical difficulties! Fortunately we have enough interesting and compelling content here at The HUB that we can dig into our archive and still offer up something that you should find, well, interesting and compelling. I’ve gone back to the early days, our 3rd week of publication, in fact, to pull up an article that you may have missed from then. Enjoy it. Meanwhile, I’ll get back to whipping those tech types to solve our difficulties.
Sales are picking up. Wonderful! We really feel good.
But is it because our sales team is doing an excellent job, or is it because the market is booming? The same applies to the other way round. Sales are down, is it us or them? Although it is so vital to our success we often do not know the real truth, and if we find out, it is very late – too late for taking the right actions early enough for meeting our targets.
But where can we get the information we need?
Companies usually collect a huge amount of data. A lot of it is available in spreadsheets, and more in ERP and CRM systems. Sales people are writing visit reports in which they describe in great detail, what they are doing and what happens with their customers. On top of that, there are publicly available market reports and information that can be gathered from magazines, internet and many other sources. So, we should know what´s going on and where we stand.
There is no doubt that all of that information is very important for managing a business. However, there are two main problems with it: It is not easy to evaluate, and most of it supports strategic long term planning but not the daily management of a sales organization.
Let´s take the success ratio typically analyzed by most companies. It tells us how well we are doing against the competition, but unfortunately, post mortem. This may work pretty well if your sales cycles are only a week long, but it will not help at all if they are months or even more than one year – the information comes too late to allow timely action. The same applies to other key performance indicators like market share, profitability, etc. None of these numbers will point to the right issues before it’s too late for appropriate corrective action. Also, these key performance indicators do not give us any hint about why they are like this.
Sales analytics, if it shall help us in managing the sales force, must be based on information generated much earlier. It must be based on information generated in real time within the sales cycles. Information which is entered by the sales people in real time while doing their day-to-day sales business. It does not have to be much information; it only has to be the right information.
Let´s look at what happens when the economy is taking a dip. We still get the same number of enquiries. Sales people will be kept busy with customer visits, making modifications to their offers and giving presentations. What changes is that there will be no decisions. Rather, decisions are postponed at an increasing rate. Sales people report budget problems by their prospects. Customers have a need, but money is not released. Discounts tend to go up.
Sure, this will also become evident when we analyze actual sales figures post mortem. But that is history. Only by looking at the signals coming from analyzing the sales process while it is transpiring will see the indicators we need to manage the future.