As someone trained in Lean Six Sigma, I see a lot of content focused on the concept of “Lean”. Eric Ries has had success with “The Lean Startup” and we are proponents of the concept of a Minimum Viable Product, which we used with the launch of our INK Sales Strategy Software. So how about Sales and applying lean methodologies to a world that has traditionally lacked some of the fundamentals of other functional disciplines?
The term Lean conjures up images of trimming the fat, which is not really the essence. The roots of Lean go all the way back to Henry Ford, but became more mature with the practices of the Toyota Production System. Lean is all about value and the primary measurement for Lean is time. Lean is about the removal of all non-value added time or waste from process or activities. Lean could be tools or methods for improving processes or an entire operational framework.
So how could this apply to the world of Sales? Let me give you an example from a prospective client that we talked to a few weeks ago. A highly successfully industry leading technology company that has $800M of revenue and over 600 sales people. They are very typical of large and small businesses that we meet with in that they do not have a common way they sell, no common sales governance, no sales methodology/training and no tools to create alignment or daily habits. CRM does not qualify. Despite best efforts, essentially every sales leader and their teams do something different. What is their biggest challenge? The business is growing and doing well, but they are concerned about the $50M a quarter of opportunities they purge from their funnel due to “no decision”. The size of that number likely got everyone’s attention. From a root causal perspective, you immediately think that these are not well qualified opportunities and many are likely outside of their target market. That said, think about the time and effort (waste) that their sales organization has put into these hundreds if not thousands of opportunities that in most cases they should not have pursued at all or at least made it to the funnel.
We have seen this across every industry and the impact on cost of sale, win rate, sales predictability, sales cycle length and other effectiveness metrics. There are vast amounts of waste within the sales system and that goes all the way back to Sales Strategy and lack of potential focus and alignment throughout the system. If you were a Sales Factory, as the roots of Lean are in manufacturing, to be certain you would invest in common strategy, structure, process, training, and tools to achieve consistent results. You will see that far more in transactional sales environments like call centers than you will in complex sales environments. We are working with a large client right now that has made significant investments in strategy, process, training and tools to get their teams focused on the right targets, differentiating in how they sell and getting themselves quickly out of opportunities where prospects are unlikely to make change or where they are not well positioned. This takes discipline and focus, but they have already become vastly more productive and effective.
If Lean is about time, then Six Sigma is about quality. We believe their is a large opportunity for Sales organizations to reduce waste, increase productivity and improve the quality of their outputs through some relatively simple principles and improvement methods. That said, improvement starts with problem understanding and a commitment to make change, which is where it stops for most companies.
What do your experiences tell you about this topic?
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