Enabling Analysis

As management consultant Peter Drucker once said: If you cant measure it, you cant manage it.
Even large quantities of data arent much good if theres no process to sort through and make sense of it all. What if sales managers were able to do more for their team than just repeatedly question if theyll make their quota? And what if sales operations personnel could carefully tailor an ongoing analysis of performance that gave managers specific insights to offer their people in the field?
2008 Joyce Hesselberth c/o theispot.com

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Effective sales analysis can move an organization away from quota achievement as a primaryyet almost always flawedmeasure of performance. BY JESSICA ROYER OCKEN

Sales analysis enables improvement of activities that are not always easily observed, says Tom Ingram, Ph.D., marketing chairperson for the College of Business at Colorado State University and one of the authors of Sales Management: Analysis and Decision Making. This is a more enlightened approach than pushing everything down to the salesperson, he says. Research indicates that the organization itself has a huge impact on individual salesperson performance. Sometimes we see organizations acting like they dont know that. They push the salespeople harder and harder without thinking about what theyre doing to support them.

This is where effective sales analysis (and corporate leadership that understands its importance) can save the day. You can succeed in being realistic but also ambitious if you have the data, Ingram says. Another common mistake is not maximizing the analysis. [Companies] look at sales and percent increase or percent of sales compared to target, and thats good, but [they should] go beyond that, says Rosann Spiro, Ph.D., chair of the marketing department at Indiana Universitys Kelley School of Business and an author of Management of a Sales Force. Spiro says companies need to know which products are

Determine what questions your salespeople are asking and then design automated analytical processes to give them the answers to these questions without them having to do the analysis.
Dan Ganse, managing director, Synygy
PUTTING A PROCESS IN PLACE
Conducting sales analysis and providing useful information to salespeople is among the best means of support. Deciding what to measure is central to effective sales analysis, but people often use the wrong gauges. Executives love to measure attainment of quota, says Al Case, principal analyst for ES Research Group, a West Tisbury, Massachusetts-based sales consulting firm. However, sales quota as a metric is relatively meaningless. Thats what someone else decided you should sell. It may be based in someones reality, but what empirical evidence is it based on? Case in point, Ingram recalls a previous job as a product manager for a Fortune 500 company. He was working late on his first annual forecast one evening looking at trend data, as well as sales force and customer surveyswhen a co-worker asked him why. Dont waste your time on that forecast, the co-worker said. Corporate has a number. Sure enough, the next day the companys leadership announced a 12-percent growth goal. Based on what Id seen, that didnt seem possible, Ingram says. I thought if we had a great year, we could grow eight percent while the industry would only grow five percent. But in our company that would be viewed as a failure. selling the best, which are not selling, which cost the most to sell, which customers are more important and which kinds of customers are better for the company. The key to doing [sales analysis] right is going in and looking in a detailed way. To get the necessary details, start by thinking about the goal. Goals, methods, metrics is the ES Research approach, Case says. If the goal is increased sales, then determine the method to achieve it: A company could hire more salespeople or require each of the current salespeople to sell more. Next, decide on a quantifiable way to measure progress. If more salespeople will be brought on board, set a target for a number of new hires. Similarly, if youre going to make your [current] salespeople more effective, you need to know how much theyre selling now and how much time they invest, Case says. Only then can you determine how to increase their productivity. The analysis process, however, has yet to begin. You may know what to do based on the goals and methods [youve selected], but you have to measure over time to know if youre achieving, Case says. It may take a few months to know if the correct method was chosen.

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TURNING DATA INTO INFORMATION

Practically speaking, to do sales analysis correctly, let technology help. [Technology] has a huge enabling impact if its done right, Ingram says. Its likely

2008 Joyce Hesselberth c/o theispot.com

Measuring results over time is the key, as research has shown that in the short term, the very act of assessing something has a positive effect. Have someone walk through the office with a clipboard, and productivity is likely to increase. The first 90 days after a training seminar, sales will be up, but then the effects wear off, Case says. This is known as the Hawthorne Effect (after Western Electrics Hawthorne plant where it was first observed), and companies must measure beyond it to know if theyve really effected lasting change. Youll miss it if you dont look six or 12 months out, Case says. We encourage [our clients] to take a longer view. In addition to a longer-term focus, sales team input is an essential part of meaningful sales analysis. Determine what questions your salespeople are asking and then design automated analytical processes to give them the answers to these questions without them having to do the analysis, says Dan Ganse, managing director at Synygy. The best organizations effectively align their strategy with the way they are providing analyzed information to salespeople on an ongoing basis, he says. Asking salespeople what questions they most need answered also encourages them to take ownership of the process of maintaining timely and accurate data. You have to have a sales force committed to providing good information, Spiro says. You do that by involving them. These experts warn, however, not to turn salespeople into analysts. Sometimes in an attempt to do better sales analysis, companies turn to the data query capabilities and other analytical capabilities within their CRM [customer relationship management] systems so that salespeople can query and analyze data, Ganse says. This is a major flaw since salespeople are not trained to be analysts and should be spending their time selling and not attempting to analyze data. A better approach is to use an automated analytical process that consistently and accurately analyzes the data and provides conclusions and recommendations to sales managers and salespeople. Analyses can be performed in a centralized manner that more quickly adapts to changes in strategy, Ganse says. As strategy changes, the analytical process can then be changed in a consistent manner across the entire sales force to ensure an alignment between strategy and desired behaviors.

the easiest means to manage and make sense of the mountains of data that now need interpretation. A lot of good sales analysis spans multiple data setslooking into booking and billing and forecasting to try to get a collective view of a customer or geographic area, Ganse says. The key is that ability to integrate from multiple data sets to produce common answers or analyses. Some of this data can even be extracted from existing systems. Almost every client weve worked with has seen improvement with sales reporting and sales analysis, Ganse says. Weve taken them from row-and-column data tables which require salespeople and sales managers to interpret the data to something that focuses on answering key business questionsand giving salespeople a consistent interpretation of strategy and, of even greater importance, more time to sell.

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