End of Third Quarter Provides Opportunity for Evaluation of Metrics

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This time of year tends to ‘strike’ most of us like the blasts of cold Canadian air that will be coming our way soon.   How did we get to the fourth quarter of the year already?  Wasn’t it just the Fourth of July?

This is the perfect time of year to evaluate the measures we’ve been using throughout the year, both to monitor our year to date performance, and to begin to evaluate whether or not the measures have been helpful in directing our strategic decision making.

The key question to ask yourself relative to what you’ve been tracking this year is whether or not the results have been part of any ‘meaty’ discussions you’ve had as a management team.  Have your scorecard results been reviewed with exceptions discussed and options evaluated?  Have metrics not met been the catalyst for robust discussions on allocation of resources?

If your metrics are helping your management team to talk about the “why” of business results instead of just reporting out, then they’re probably worthwhile measures to continue evaluating into the next fiscal year.

Sales Plan Requires More Science than Art

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When I started in sales for the Business Imaging Systems division of Eastman Kodak after college, my notion of a successful sales person was someone who could talk to anyone, had a good personality and was likeable.  Once I actually got into the position though, I quickly began to realize that true consultative selling is actually more about the science of selling than the art of selling.

The science of selling requires looking at the process from beginning to end, and defining what needs to happen at each step of the way to advance the process forward.  Most complex sales cycles take weeks if not months to come full circle.  This means that the incremental steps that advance the process need to be monitored and measured to insure forward motion is occurring. 

If your organization doesn’t have a defined sales process, consider engaging a systems oriented person in your company, or form a task team to analyze your sales process.  This should include an analysis of the sales cycle from beginning to end including the marketing activities that create opportunities and the success rates at each step of the sales process.  This analysis could also include interviews with your salespeople and perhaps a few customers to get their perspective.  The goal is to have a solid picture or framework of all of the steps that need to occur and some best practices around each of those steps. The time spent understanding the science behind your sales process will be well worth the investment as it leads to stronger sales results over time. 

A Business Plan Represents a Set of Decisions

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Have you ever found yourself struggling to create a plan for your business?  Clients tell me that writing a business plan can be overwhelming.  First of all, the writing part of it trips a lot of folks up—it can feel a bit like writing a term paper.  Then there is the analysis that’s required—for those that don’t like the numbers it can feel a bit like doing math homework.  And finally, there’s the defining the future part of the plan—what will this business be when it grows up? 

One way to reorient your thinking on the subject is to realize that a business plan is basically a document that communicates a set of decisions.  Deciding is a powerful thing—it focuses your energy and provides clarity.  A business plan in essentially asking you to answer five questions:

1.      What am I building?

2.      Why does this business exist?

3.      How will we grow this business over time?

4.      What results will we measure?

5.      What is the important work to be done this year?

The on-going benefit of the business plan is that the decisions you make in the creation of the plan will guide your day-to-day decisions and provide a path for moving forward.

Effective Communication is Key to Performance Management

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When we hear the term ‘performance management’, many of us think of performance reviews which include numeric ranking scales or scorecards measuring various business measurements.  

While it’s true that effective Performance Management must include metrics in order to provide substance and accountability, the real key to performance management is communication.  Everyone including the business owner needs to have someone; a trusted advisor, board member or manager, to help them process the data that supports performance management.

Having performance data is just the first step.  Communication is needed to interpret the results, talk about successes, identify barriers, and determine next steps.  Because employees sometimes feel threatened when discussing their performance, it’s especially important to pay extra attention to how the message is being delivered and received.  Keeping an on-going and consistent dialogue going related to performance, will also make the conversations easier to have and less threatening to the individual.

Does Your Culture Embrace Measurement?

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If you ask your employees to rank how important measurement is in your organization, how would most respond?  Would they perceive measurement is important but also feel their own performance isn’t measured?

The plain fact is that some companies are culturally resistant to change and resistant to measurement.  It’s possible that resistance comes from a fear of accountability.  But without accurate measurement, decisions are often made on how a program ‘feels’ or how much an initiative is liked by employees.

If your organization doesn’t currently have a measurement culture, it’s important to first educate employees on the importance of metrics to facilitate growth and innovation.  Gaining buy-in at the emotional level is an important first step to gaining acceptance and participation.