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When Sales goes wrong, it can go really wrong…MCE’s Sales Excellence Journey program helps senior management avoid the pitfalls of easy decisions that may not work when Sales goes wrong

To help Senior Management avoid going seriously wrong…Many companies are struggling with declining sales results and deteriorating margins. They often fail to make the right diagnosis of this problem.

Management uses Sales Analysis or the Balanced Scorecard (BSC) to monitor, control and keep track of decisions taken. Most critics call the BSC a “table of metrics”, because it does not tell management why the situation is as it is. Many executives then draw their conclusions on pure intuition (“I believe...”) or on easy assumptions (“We need to train the sales force…”) and fail to create a lasting improvement of their competitive edge.

Sales Excellence is about much more than just having a well-trained sales force. It is about understanding all measurable and identifiable interfaces that can—and will—affect your sales results. The Sales Excellence Journey is about how to manage these interfaces and how to prioritize indicated actions to get to improved results.

Sales Excellence is about the Customer’s 360° view on your company.

This document illustrates all elements of an in-depth analysis of the interfaces affecting sales. It shows how to understand the gap between the sales objectives and the achieved results, and paves the way towards outstanding sales performance.

Sales & Marketing

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Detecting the symptomsBefore jumping to conclusions about how to solve the bad sales results, it is crucial to collect all observations regarding the declining sales. Even if sales figures and margins indicate the decline, they are insufficient to explain what is going on. Senior management needs to answer the question: “Why is this happening?”

The easiest and most obvious conclusion is that there is something wrong with the sales force.

And indeed, there is: They are not selling enough. The cause probably involves more reasons than just lacking the right skills. The reason sales decline is simple: Customers don’t buy. Selling is about making the customer buy, making him know, want and desire your product. Customers buy or don’t buy for many different reasons. The skills of the sales force may be one of those, but it definitely is not the only one. You will need to look in the right places to find the answer to your question: “Why?”

The Management Pulse CheckIt is often heard that the revenue is going down and that profit margins drop because the sales force is discounting the prices. This may be so, but does the sales force do this spontaneously, simply because they feel like it?

Probably not.In order to understand the general acknowledgement of what is going on with your sales team, we start with guided interviews of all members of the Senior Management Team and the CEO. They will tell us what their perception and understanding is of the situation. It is important to know what they believe is the reality of “where we are” and what the ideal situation for them looks like, i.e. “where we want to be”.

Through this simple, guided interview technique we can create two visions of the company’s results: the actual one and the ideal one. We also can identify the gap between both visions and quantify the gap in terms of time, revenue, margin, people, customer, product and other elements that affect sales results.

Gaps between the actual and the desired situation can be illustrated either graphically (figures and evolutions over time) or in text (situations, attitudes, organizational design, etc.)

WHEREWEARE

GAP

WHEREWE

WANT TOBE

WHEREWEARE

TOBE

ACHIEVED

WHEREWE

WANT TOBE

INITIALGAP READJUSTED

GAP

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In some cases the “where we want to be” situation may be too far away from what is realistically achievable because of time, budget or human constraints. In such cases it is up to the Management Team to (re)set the goal to a realistic and achievable level. The outcome of such readjustment will be the “to be achieved” situation or the outcomes at the end of the Sales Excellence Journey. It is preferable to communicate the ultimate “where we want to be” target to the staff and other stakeholders in an appropriate and understandable way.

Looking in the right placesOnce the gaps are identified and adjusted to a realistic level, we can start digging for the root causes of their existence. We will dig in all elements that impact the buying behaviour of the customer, to find the answers to the question “Why?” We call this Root Cause Analysis (RCA).

Root CauseAnalysis Basics

Symptom of the problem.

Above the surface(obvious)

The Underlying Causes

Below the surface(not obvious)

The word "root" in Root Cause Analysisrefers to the underlying causses.

not the one symptom.

RCA practice tries to solve problems by attempting to identify and correct the root causes of events, as opposed to simply addressing their symptoms. “Success” is defined as the near-certain prevention of recurrence.

Questions to ask as part of Root Cause Analysis:• Product: Is the product that you sell adapted to your customers’ expectations?

• Price: Are customers willing to pay the price that you ask?

• Service: Are you offering the service your customers want?

• Place: Is it easy for customers to get your product, where they expect it?

• Promotion: How do your customers discover your product and how do you make them want it?

• People: How motivated and trained is your (sales) staff to satisfy customer needs and wants?

• Processes: Do your people understand how to please the customer in a consistent way?

• Tools: Do your people have the right tools to do the above?

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The process of documenting and performing root cause analysis generally comprises the following steps based on the eight elements described above that impact the Customer Buying Behaviour.1. Define the problem or describe the situation factually. Include the qualitative and quantitative

attributes (properties) of the outcomes. This usually includes specifying the type or category, the size, location and timing of events.

2. Gather data and evidence, classifying it along the Customer Buying Cycle (see figure below). For every behavior, condition, action, and inaction specify in the “Cycle” what should have been done when it differs from what was done.

3. Ask “Why?” and identify the causes associated with each step in the sequence towards the defined problem or event. “Why?” is taken to mean “What were the factors that directly resulted in the effect?”

4. Classify causes into causal factors that relate to an event in the sequence and root causes that, if eliminated, can be agreed to have interrupted the buying process.

5. Identify all other harmful factors that have equal or better claim to be called “root causes.” If there are multiple root causes, which is often the case, indicate those clearly for later optimum selection.

6. Identify corrective action(s) that will with certainty improve Customer Buying Behaviour.

7. Identify solutions that—when effective and with consensus agreement of the group, prevent recurrence with reasonable certainty—are within the institution’s control, meet its goals and objectives and do not cause or introduce other new, unforeseen problems.

8. Implement the recommended root cause correction(s).

9. Ensure effectiveness by observing the implemented recommendation solutions.

10. Identify other methodologies for problem-solving and problem-avoidance that may be useful.

11. Identify and address the other instances of each harmful outcome and harmful factor.

We gather data and evidence and classify it along the Customer Buying Cycle from ‘awareness’ to ‘loyalty’. For every behavior, condition, action and

inaction, we specify in the ‘timeline’ what should have been in place when it differs from what happened, and we ask: ‘Why?’

Customer Buying CycleAwareness Loyalty

I Know

I LikeI Want

I Look I Find

I Choose

I BuyI Use

I Stay Come back

MCE, together with the Project Team, defines the appropriate buying cycle for your company, either B2B, B2C or both. All corrective actions are associated with actions/steps on the Cycle and improvements are evaluated. Processes are

adapted accordingly, tools improved, people’s skills and attitudes adjusted and trained. The root cause of every step in the Cycle is addressed and eliminated.

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Fight the right battles: You get what you measureOnce we detect the root cause of malfunctioning, we can fix it. We can quantify the impact of the fix, and we can identify quick wins.

During the root cause analysis we can turn problems into opportunities. When you fix the cause, the issue goes away. Only measurable, quantifiable and ROI-based initiatives will be the must have drivers of the Sales Excellence Journey. They will

maintain management’s attention and deliver the consolidated view that every CEO wants: “What is the impact, what will it bring and how much will it cost?”

Number ofstreams

Overalimpact

List of actions

ProjectStart/end

Total budgetROI

Monitoringstatus

Quan�fied Quan�fied For info Defined Target On track?

By turning problems and issues into opportunities, you build a positive vibe that contributes to better results in your company. Even if cuts have to be made at times to achieve better performance, they

will be done by the Project Team and the Project Sponsor in support of the strategic goal: to please the customer and to improve results.

Plan to winIf you want your plan to be implemented, we advise to assign a Project Sponsor among your Senior Management who will keep the project alive. Preferably this will be the Sales Director.MCE will provide assistance and project management for the Project Sponsor to ensure that all of the following gets done:

• Weekly monitoring of progress per stream

• Assistance of stream leaders

• Monthly coordination and progress meeting with all stream leaders

• Ensuring involvement of sales people

• Accompany implementation of stream results (initiatives, behaviors, attitudes)

• Ensure end-of-stream validation and hand-over where needed

• Ensure that the teams are motivated and that the streams produce results

4 Phases ApproachThe Sales Excellence Journey consists of four highly critical phases. At the completion of each of the phases a comprehensive brief will be presented to the Management Team for approval and input.• Phase 1: “Where we are – where we want to be” and Gap analysis – high-level data gathering

• Phase 2: Root cause analysis and identification of improvement opportunities

• Phase 3: Selection of opportunities, implementation and action plan

• Phase 4: Management of the Journey

The Expected Outcome is a Sustainable Growth Model for Your Company

At the end of the Journey you will have achieved much more that you could have achieved by just “training your sales force”.

You will have achieved Sales Excellence throughout the Company and you have constructed a sustainable growth model.

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All the Root Causes of the reluctance for Customers to buy your product have been removed and have been turned into opportunities by you own people.

• Product: The product that you sell is adapted to the customer’s expectations

• Price: She/he is willing to pay that price that you ask

• Service: You are offering the service that she/he wants

• Place: It is easy for your customer to get your product, where she/he expects it

• Promotion: Your customer discovers your product easily and wants it

• People: Your people are motivated and trained to satisfy the customer’s needs and wants

• Processes: They understand how to please the customer in a consistent way

• Tools: They have the right tools to do all the above

The Track Record of the Excellence Journey provides you with a detailed report of all initiatives that have been implemented. This ensures the Sustainability of the Sales Excellence and allows fine-tuning when things may shift again over time. The acquired RCA methodology and the ROI-based action plan ensure that new initiatives are implemented in a consistent way.

Methodologies and processes have been adapted, documented, implemented and acquired. The existing tools have been improved where necessary; new tools have been put in place. The usage of the tools is embedded in the process.

You have not wasted budget or resources, you have built a solid basis for improved sales and margins.

About Management Centre Europe

Management Centre Europe (MCE) is the largest provider of organizational, management development and strategy execution programmes for international companies, wherever they have operations. We enable individual managers and management teams to deliver on their strategic goals, through open enrolment workshops, in-company workshops, advising, business coaching and mentoring, and a variety of tools, assessments, and simulations.

For more information, visit www.mce-ama.com

If you have an issue that needs a creative solution you would like to discuss, contact us:

• Main Office (Brussels, Belgium): +32 2 543 21 20

• Email: info@mce-ama.com