Applying an Engineering Process or Six Sigma to Your Sales Force
CRM software is great, but the biggest challenge of CRM is having it support your existing processes. Most organizations look at selling like a magic black box, not understanding it is a series of processes with a singular objective.
Making CRM Work: Employ an Engineering Process to Sales
To make CRM work, you can apply engineering principles, such as Six Sigma, to capture your existing process, then through any process improvement gains with CRM gather measurements in return to improve sales once your selling processes are captured. It's a cycle of continuous process improvement.
Why can't you have multiple selling processes? Selling skills are often thought to be based on experience rather than some fixed method. This is true and false; however, once you apply the constraint of software (for the purpose of measuring, oversight, information capture, compliance) each user’s process needs to be simple.
This introduces another problem faced by organizations: standardize the selling process or generalize the CRM solution. Both have their problems, both problems again solved by engineering, more importantly by Six Sigma methodologies.
Utilizing Three Levels of Six Sigma
Start with a metric: Simple selling metrics include number of contacts, number of appointments, number of new customers, volume of estimates/quotes, volume of new customers, total volume of accounts.
Next look at methodology: Have each sales person articulate how he gets to each number. Most selling processes have a foundation in "prospect, present and close." Have each sales person put a period (when it happens), duration (how long does it take) and estimate sales cycle by line (time from start to finish).
As a management system: From similarities in process, consistency in measures and input from your sales team, tailor your CRM solution to support and automate these efforts. Start with efforts to capture data and gain more accurate measures. Next build in automation for common cross process tasks.
I use the term "engineering process" rather than strict Six Sigma because I want to stress the importance that this is a measurable process. Once metrics, methodology and a management system are in place, your team can move forward with process improvement and reducing "defects" in your selling system.
In the case of selling, your "defects" include: number of contacts who do not become customers, number of customers who do not repurchase and a ratio of customer complaints/service items to sales. The last factor helps handle "customer was sold the wrong solution" moving from a selling to a service model.
The same business process improvement methodologies apply to the selling process, including understanding customer requirements, aligning key business processes (both internally, with client and with partners), utilizing measures to be sure you are providing the right solution and driving for continued sales (rapid and sustainable improvement). Unfortunately many sales people don't embrace the connection because it makes the selling process seem longer. In truth, transaction size increases and you have greater customer satisfaction.
Key to Embracing Process Improvement: Knowing Your Customer Is Satisfied
In order for sales people to embrace this kind of process improvement, they need to see the benefit of satisfied customers. A business needs referral and feedback collection, not just to improve process, but to equip marketing and sales with social proof to reinforce this change in behavior.
Collection of endorsements, feedback, customer satisfaction and even testimonials must feed back into selling from across your organization. These materials can be used to demonstrate lower risk choosing your organization and is essential to motivate executives to buy.
Depending on how you collect this information, it can be connected to a scorecard measure of sales quality. One difference is the actual content of the measure can also be incorporated into marketing materials and sales presentations as proof of performance. In other applications of process improvement, this kind of "feedback" is very often limited to planning meetings and isn't shared with customers (or even prospective customers).
Any information that can be shared will be packaged by marketing or used by sales both before and after a customer comes on board. Best practices can be applied all across the selling process, including advanced selling that extends measures into customer benefit then presents them post sale as an "assurance of results."
Some careful consideration is required here. You can't plug in your general process improvement to show proof because some measures are very useful for competitors. When applying the engineering process or Six Sigma in selling, information needs to be segmented and categorized, and specific guidelines are necessary on what can be publicly shared.
Specific Application of Six Sigma DMAICT Model
Sales people can use the DMAICT model in their sales approach. From a sales management prospective, the DMAICT model in Six Sigma coupled with a sales process approach provides oversight. This kind of oversight helps weed out unproductive sales people, no matter what kind of complex solution you are offering.
The DMAICT model of process improvement applied as a sales person:
- Define opportunity. What problem does a customer have? What result does he desire?
- Measure performance. What does the problem look like? How much does it cost to have? What kind of defects does it introduce?
- Analyze opportunity. Is the problem big enough to be worth solving? Will our solution solve the problem in a cost effective manner?
- Improve Performance. Are there any skills I'm lacking that keep me from closing more sales? What are the limiting factors that keep a prospect from purchasing?
- Control performance. Does the customer understand how this change will improve his ability to reach the desired result? As a sales person, do I understand the customer’s desire and have I matched his concerns?
- Transfer best practice. What works in selling what I offer? What are other sales people doing who are getting better results?
- Define opportunity. How much does the organization need to close? What are the sales quotas established? How many new customers do we need?
- Measure performance. What is the value of customers coming on board? Where are sales people performing in relation to targets?
- Analyze opportunity. Where will numbers fall short? Where is performance lacking (see metrics in the sales process)? Are the opportunities in our sales funnel going to make numbers?
- Improve performance. Where do sales people need coaching to overcome limitations in performance? What kind of training, resources or compensation is necessary to gain results?
- Control performance. How are reviews conducted, can sales people self monitor actions? What happens when someone makes quota, exceeds quota? How is customer satisfaction compared with volume?
- Transfer of best practices. What are my best people doing, and what can others be doing? What performance measures (actions) are common across successful sales performers?
What's critical to your entire organization is providing a volume of sales to support other process improvements. For accurate measures in other areas of process you need transactions. Your company’s business development (sales and marketing) team make this happen—but don't exclude them from process improvement. You can measure this part of your business.
One thing I shy away from when describing the "engineering process" to selling professionals is mentioning Six Sigma. Very often sales teams think Six Sigma just applies to manufacturing or the warehouse. This assumption of Six Sigma is a huge mistake and misconception.
Linking Six Sigma or the Engineering Process for Sales Back to CRM
How does the application of Six Sigma or an engineering process to sales go back to CRM? Your CRM system often provides the easiest way to enforce existing processes, capture metrics, or automate low result activities. However, jump in too quickly without considering the sales process and you'll waste resources while frustrating sales people. This is why applying the engineering process or Six Sigma to selling helps even before you have CRM or any other sales management software.