Today's post was written by Michael Liebow, founder and CEO of Foretuit Inc., the leading company in predictive sales pipeline management. Michael has successfully built organizations that uniquely address the needs of global markets and industries.
Was August's Dreamforce a corporate event? Or a counter-cultural San Franciscan summer of love replete with shouts for an "Enterprise Uprising?" If you were one of the 45,000 attendees, you probably think the latter. Now that I'm returning from my 'cloud high', I find myself searching for the means in which to make the grandiose vision of the Social Enterprise a grounded reality – and to enable the kind of hard metrics that most senior executives crave in order to rationalize the required investment and resource allocation. Based on my research, socialization allows you to focus on improvements in these five areas:
#5: Reduced Organizational Costs: Reduce the overhead of administrative tasks and redirecting high value resources to generating revenue not managing process. Yes – there's a novel idea – have sales people in front of customers instead of doing mundane chores. How much time is spent each week in your org on sales reviews? Some organizations spend upwards of two days each week, allocating hours to understanding what is happening with each forecasted deal. This burden keeps resource from being with customers which is why you hire a direct sales org in the first place. The goal should be to reduce the weekly process to minutes, not hours or days. Do you have metrics in place for selling time improvement?
#4: Improved Sales Efficiency: Support automated task planning, streamlining labor intensive and error prone activity. What is the compliance rate of associating information within opportunity records? How many clicks does it take to add a task or associate an e-mail? And what is the currency of the information? If some actions take upwards of 30 clicks, then is it any wonder why adoption, compliance and currency are so low. What if you handle the same load in one, two or no clicks? Wouldn't that yield significant improvement?
#3: Increased Leverage/Effectiveness: Better target sales effort at prospects that are winnable and redirect resources away from lost causes as early as possible. On average, losing deals stay in the pipe twice as long as winning deals. Orgs are loathe to 'de-clutter' the pipe of what can only be referred to as “coverage fodder.” For some reason, big coverage factors on a 1x target seems to make management happy, that is, until deals begin vaporizing at quarter's end (they never slip, now do they?). Having a clean, clear pipe helps allocate resource better but requires a degree of organizational integrity to let go of the failed opportunities. Lowering deal maturity days is critical.
#2: Better Risk Management: Reduce the need to build in margins and improve the accuracy of projections – projections that are critical to right-sizing production and other upstream and downstream decisions. Intellectual honesty in forecasting can be difficult to achieve primarily due to subjective and highly interpretive nature of deal stage maturity assessment. Making the process fact-based has been elusive at best, but can be done with the right pipeline management capability and transparency. What's your forecast accuracy? How is it measured and tracked? Do you use standard measures of deal maturity? Are they uniformly applied?
#1: Improved Employee and Process Assessment: Provide the opportunity for detailed performance assessment and continual sales process improvement, not to mention allocate incentive compensation more fairly to those most responsible for winning deals. Many organizations find attributing contribution difficult at best. With a clear understanding of actual contribution to the deal and an understanding of behavioral characteristics associated with internal and external activity – an organization has better odds of improving productivity and process, not to mention retaining the most valuable performers. Do you measure contribution, responsiveness and timeliness of interaction, throughout the entire deal lifecycle?
Bottom-line, modest improvements in sales efficiency and effectiveness can yield significant short term ROI – not including higher deal win rates which would boost the return exponentially. Take a solution that costs an incremental $50/per user/month but yields a certifiable 25% increase in sales operation efficiency and a 10% improvement in management time. Based on average comp, you would likely see a 400% ROI within 12 months. Now you can rationalize the underpinnings of a socially connected enterprise. And for any leading enterprise to be social, its sales people must become more effective and efficient – in other words, they must spend more time in front of and with customers. Now that's love.