Sales Kaizen

CRM makes several promises to its users, including selling more or selling faster, resolving service issues faster or at least quickly, and generating more leads. If you do root cause analysis, however, you can quickly conclude that at least in some cases, you are looking through the wrong end of the telescope.

For instance, the best way to resolve service issues is to avoid them in the first place. Figuring out how to head off problems is both highly cost-effective and better for raising your profile with your customers. Heading off trouble is beyond the scope of CRM, though a close second in this derby is deflecting customers to other less-expensive channels. Although these things have a passing resemblance, deflecting is worlds away from heading off.

Much the same can be said of selling faster. I am not a fan of faster selling because we’ve reached the point where we are pushing on a string. You need only recall that the customer buying process is in direct competition with traditional sales processes to see this.

That leaves marketing. If you look at the strides made by marketers in the last few years, you might come away wondering how they did it. Marketers really are generating more leads, and they are better qualified by the time they get to sales people. So how did they do it?

The Customer Feedback Loop

One of the big differences I see between marketing and the rest of CRM is that marketers constantly ask customers for feedback. They might not launch questionnaires every minute, but the data stream coming back from numerous marketing initiatives provides them with great insight into what’s going on in their respective patches, and it tells them what needs to be done next.

This feedback loop is not new; it goes way back to W. Edwards Deming and his regimen of statistical analysis. Deming was all over manufacturing like a cheap suit. He collected data and ran stats on manufacturing so that he could know what worked and what didn’t. He then went the extra mile and tried to weed out what didn’t work and reward or encourage what did.

In the process, manufacturing got better. There were fewer defects, better tolerances between parts, and less waste, resulting in a decline in manufacturing costs.

Japanese manufacturers were, famously, the first big adopters of Deming’s ideas — and we all know what that led to. They have a word that’s useful to remember, kaizen, which means, roughly, “continuous improvement.”

So how does this apply to CRM? Quite simply, modern marketing has its own kaizen thing happening, and I think it’s worth asking how we can apply these principles to sales and service.

In service, we have metrics that look at speed — like time in queue, time in resolution process, and lots more metrics that measure speed, but not necessarily effectiveness of the encounter. It’s great to get customers on their way quickly, but what does this do for handling cross-sell and upsell opportunities?

It’s in sales that I am most intrigued by the possibilities of a kaizen strategy. A slim majority of sales people make or exceed quota — in recent years, 58 percent, plus or minus a little, according to CSO Insights Managing Partner Jim Dickie.

The interesting thing about selling, for me, is that there’s usually only one evaluation point: Did you close the deal? What if we used a more incremental approach to assess sales, like marketers do when they capture customer input throughout the nurturing process?

Mid-Sales Survey

That might be a scary proposition for a lot of sales people. If there were a natural point in the process when everybody stopped swimming for a moment to look up and determine if they were still on track, then the feedback might be very useful. For example, how was the demo? It’s a very important part of the sales process, and good reps will ask during and after if the demo answered the customers’ questions and concerns. “Was it all right?”

Customers often will play along, but saying that the demo answered all questions is not the same as saying that the demo showed me that this solution would work in my shop. A customer running a buying process wants to be able to have alternatives at decision time, so it’s not good to eliminate all contenders lest there be no leverage when discussing price.

So, everybody keeps swimming until most of the sales people are surprised at the end when their solutions aren’t selected. After all, everything in the process went according to plan.

That’s why it might be useful to go up a level of abstraction in the sales process by sponsoring a mid-process questionnaire. Rather than asking about nebulous things like the rep’s professionalism or even if the five major points of the demo were articulated well, ask open-ended questions about fit. On a scale of 5 or 10, how would you rate this solution’s suitability for your needs?

There are a lot of questions you could ask and they would give you a better picture of your position in the account than relying on traditional process milestones that are completely vendor-oriented — e.g., if we’ve done the demo, then we must be X percent of the way through the process.

If we take a kaizen approach and don’t simply wait until the process is over to assess our performance, we may not be able to impact an ongoing sales process (though we might) but we will do two other useful things. We’ll improve selling over a short time and we’ll be able to safely weed out deals that won’t go anywhere. Eliminating bad deals saves resources and is the ultimate form of sales acceleration.