An Eye for Details: Measuring Your Business Success

No sales force can truly be considered a “best practice” unless it meets the test of measurement. If the ‘practice’ works, you should be able to visualize, define, and measure the results. There is no easier way to prove the ‘measurement’ theory than with sales.

In the past 15 years, strategic management has focused more and more on measurement. Strategic management was revolutionized in the early 1990s by Drs. Robert Kaplan (Harvard Business School) and David Norton when they created their measurement system, the ‘balanced scorecard’. Other approaches adhere to the same rule of accountability by recognizing some of the weaknesses and vagueness of earlier management approaches.

Measurement provides a clear prescription as to what companies in all areas, from sales to marketing, should measure in order to reach their financial goal. You often hear the expression in sales, ‘what gets measured gets done’, but in recent years I have expanded this statement to, ‘what gets measured by the individual, creates accountability and therefore gets done’.

For instance, as a sales manager, you may give your sales force a specific sales target, a measurement if you will. At the end of the month or quarter, if the salesperson did not reach that target, you may question them on it. Chances are you have heard every variable and excuse in the book; ‘Our product or service has no name brand recognition’, ‘Our product was too expensive’, ‘I cannot get anyone to meet with me’. Giving the sales force a ‘target’ or a measurement still leaves a window of accountability. In fact, what gets measured still may not get done.

Measurement alone is not enough to create accountability. You also need a commitment or buy-in from the salesperson. Commitment is internally motivated while compliance is external. Compliance is following a rule, commitment is something you believe in. If you empower your sales force to create their own set of measurements, they are going to be more motivated to meet them. Often when measurements or targets are instituted and monitored by someone else, the responsibility can easily be diffused to other external forces.

There are various ways to create accountability and commitment in a sales force. For example, in the weekly sales meeting, you can ask your salesperson to quantify each and every prospect and opportunity in his or her sales cycle. If they are given a target of X amount, ask them to determine the number of appointments they will need to reach that goal, take it a step further by asking them to determine the number of calls needed each day and week to make the specified number of appointments. Once they have created their own set of measurements, ask them to rate each prospect. Which ones have a greater chance of closing? Why?

Accountability and ownership is the first step in establishing legitimate return measures. With systematic assessment and ongoing evaluation, an individual can become more and more committed to reaching his or her own personal goals.

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