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Six Sigma & Your Sales Process

Six Sigma and Your Sales Process - Millau Group Global

Six Sigma and Your Sales Process - Millau Group GlobalOrganizations continually invest resources to improve the effectiveness of their sales teams.  There are hundreds of sales training companies offering thousands of programs in all aspects of selling: call planning, presenting, negotiating, managing key accounts, questioning and so forth.  These programs are a prerequisite for a salesperson’s success.

However, what these organizations are often neglecting is something just as fundamental as basic selling skills; a systematic method to continually improve their sales process. Obviously not having a sales “process” is a problem but identifying it as a problem is the first step toward fixing it.

Six Sigma is the systematic way to continuously and intelligently improve your sales process resulting in increased sales, decreased costs and improved productivity.

What is Six Sigma?

Everyone understands the term “Sales Process”, few however, can actually describe their sales process from a Six Sigma perspective. Many of you will find that following the reading of this article, that your sales process isn’t a process after all.

Six Sigma is a structured, disciplined and rigorous approach to process improvement.  The goal of Six Sigma is to increase profits by eliminating Variability, Defects and Waste.  Although Six Sigma is typically thought of in a manufacturing environment, its principals apply to all processes – including your sales process.

Applying the principals of Six Sigma to Selling

How well does your sales process meet your expectations relative to Variability, Defects and Waste?

Variability is defined as lacking a consistent, systematic approach to selling which results in essentially every member of your sales team pursuing opportunities differently.

Do you have variability in execution? 

Identify an active sales opportunity where the outcome is in doubt.  Write it up as a case study and pass it out to your sales organization.  Ask, “What would you do next to move this forward towards a close?”  How many answers would you expect to get?

Defects are lost sales.  According to our studies, the average closing rate across all industries is approximately 25%.

What is your closing rate?

A 25% closing rate is a 75% defect rate. Is that acceptable anywhere in your organization? So why do we accept it in sales?

Waste are resources not invested where they will produce the greatest return.

What percent of your resources are currently being wasted?

If you’re losing at a rate of 75%, you’re investing a significant amount of resources where they do not produce a return.

If you’re experiencing the above issues, Six Sigma will have a significant positive impact on your sales results.

Applying Six Sigma to your sales process

There are 5 key elements to Six Sigma – Define, Measure, Analyze, Improve and Control. (DMAIC) Incorporating these elements into your sales process will produce immediate, measurable results.

1) Define

First, what needs improving?

Identify the problem you want to solve.  While Variability, Defects and Waste are all critical, if you solve the Variability problem, Defects and Waste will also be positively impacted.

For the sake of this discussion, let’s focus on Variability in execution as the problem we want to solve.

2) Measure

Now that we’ve isolated Variability as the problem we want to solve, we need to use facts and data to identify the root cause.

If the execution of your sales process is based on data/facts and not gut feelings or emotions, gathering the data will be straight forward.  If, however, your sales process is not based on data, this will not be possible.  The good news is that you’ve identified a problem that you can now solve.

An example of measurable data is how many of your pursuits are a good fit for your company, i.e. in your sweet spot?  If you have specific criteria as to what makes a good fit and everyone in the sales team utilizes the criteria, it’s very straight forward to identify what percent of pursuits are a good fit.  If your sales process does not specifically state the criteria and how to use them to establish fit, a significant number of opportunities your salespeople pursue will not be a good fit; defects and waste will be high.

3) Analyze

Based on the outcome of the Measure phase in our example, we have identified that salespeople do not ensure that customers are a good fit for your organization prior to investing company resources.

Analyze the situation by using the data to determine the root cause(s) of the problem that’s inhibiting your performance.

Why are they not doing this?  If you were to ask your sales team, “What criteria do you use to determine if a customer is a good fit?”  How many answers would you get? If it’s multiple, you’re close to discovering the root cause of the problem.

Often the root cause can be traced to the fact that they don’t know what makes a good fit, or they do not consistently and systematically filter their pursuits based on fit.

4) Improve

With the root cause identified, develop potential solutions.

For our example, it can be as simple as identifying what makes a good fit, communicating it to the sales team and ensuring compliance.

Test solutions to validate your approach – use data when possible, not emotions or gut feelings.  Test with a control group of salespeople to verify the impact of your solution.

5) Control

Finally, implement your solution, use data to determine the extent of the improvement and to ensure gains are not lost over time.

This is a critical stage; there is a tendency to implement the solution and stop.

The idea is to leverage the key elements of Six Sigma to drive continuous process improvement; it’s not a one-time event.

Applying the DMAIC to your sales process will enable you to experience the benefits of continuous process improvement and minimize the negative impact of Variability, Defects and Waste.  Over time, you will find that focusing on your sales process will yield similar, or greater, returns than continually investing in conventional sale training and provide you with a sustainable competitive advantage.

David L. Varner
Founder of The Millau Group Global

Having started his career in engineering and spending the last 20 years in sales training, David is passionate about bringing the consistent, repeatable, data driven approach of engineering to selling.

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5 Minutes to Increased Industrial Sales

Overview

Selling in the industrial marketplace presents many unique challenges.  Salespeople are required to have a high degree of technical skills. My first sales position was as a sales engineer for a machine tool and robotic systems company.  I had been an engineer until they put “sales” in front of my title.  To be effective at selling and providing my customers with solutions required that I have a high level of technical expertise.  So far, so good.

 

Challenges for Industrial Salespeople

As a sales engineer, I was most comfortable out on the production floor looking for problems to solve and areas where I could help my customers increase productivity, whether it was a priority for them, or not.  I thoroughly enjoyed my time on the floor because I was in my comfort zone; I was the expert.

This comfort with the technical portion of my job also posed my greatest challenge.  I would spend the vast majority of my time focused on the engineering portion of my title.  What I didn’t recognize at the time, was that I was neglecting the “sales” portion of my title.  I was more comfortable with the “science than the selling” (which also applies to other industries where the salesperson’s job requires special knowledge, or expertise, to be effective).  Looking back, I was often an unpaid consultant for many companies!

 

The impact?

 This technical focus negatively impacted not only my results, but those of my company.

For me, pursuing essentially all opportunities, I was not able to focus on the ones that were likely to profitably close.  Additionally, I was not pursuing net new business.  The opportunity cost was significant.

For my company, I was tying up critical resources, such as engineering, on projects that we were not going to win.  Since I was not alone pursing science projects, engineering’s response time was slow.  Additionally, they didn’t have the available resources to fully support the real projects.

 

The solution?

First, recognize the fact that your sales are currently being negatively impacted by not having an acceptable balance between the science and the selling.

Take a minute to truly understand your opportunity cost of pursuing opportunities that are not going anywhere, or as we used to call them in engineering, the science projects.  The average closing rate in industrial sales is 25%, or a 75% losing rate.  How would your sales be impacted if you could systematically disengage from 1 out of the 4 opportunities you’re currently pursuing? How would your company be impacted if the sales team systematically disengaged from 25% of the pursuits that they’re not going to win?  The answer is obvious, but doesn’t it seem too good to be true?

Second, add one step to your sales calls.  Before executing the sales call, think about whom you’re calling on and where they are in their buying process.  Then, identify what is a reasonable action for them to commit to that supports they are making a buying decision, and you’re seriously being considered.

Once you’ve identified the action that you’re seeking, consider how you’re going to ask for it.  It’s not enough to have identified what action you want, you need to be comfortable actually asking for it.

An action is binary; you either get it, or you do not.  Think of a go/no go gauge.  If you get your action, keep pursuing the sale.  If you don’t get your action, this is an opportunity to sit back and consider if this is one of the opportunities that you’re not going win.  Getting your ask, or getting a no, are both successful outcomes.

There are no “maybes” on a go/no go gauge!  (No matter how hard you push…)

 

Summary 

  • Before any important sales call, meeting, demo, etc., identify specifically what action you’re going to ask for as a result of the meeting. If it’s a team call, share it with all the participants.  Take a few minutes to practice your ask.
  • Once you know what action you’re going to ask for, practice your ask. Ideally role play it with someone.
  • Deliver your ask and seek success. Success isn’t a yes.  Success is defined as either a yes or a no.  Use this data to make an informed decision regarding the next step to move the pursuit forward, or if you didn’t get your ask, use the no as a compelling event to either change your approach, or disengage.

Do this and your sales will increase.

There you have it.  Simple – as selling should be!

7 Deadly Sales Mistakes

Chase customers who are not a good fit

Us salespeople love chasing all sales opportunities that come our way. That is resulting in a mistake. A mistake of chasing opportunities that are not a good fit for us. These opportunities are not likely to move forward or turn into positive ROI. If your sales team is closing 20% (1 out of 5), it’s likely one of those four losses was a poor fit.
It’s also likely that if the opportunity made it’s way down your sales process (assuming you have one) far enough to be forecasted, it met your ideal customer profile on paper. Which means it was likely the right size, in the right industry, used your type of product or service in their business already (manufacturer for example), and are credit worthy or established in their network. These are all characteristics to look for in a customer or prospect, but they are not the reasons salespeople lose or are blindsided by the outcomes.

Not working hard enough to identify AND ENGAGE with active DI’s

With the average number of people involved in a decision to go forward increasing (5-8 depending on your source), we salespeople need to do a better job at navigating through multiple decision influencers and understanding how they’re impacted. Leaders now are catching onto the “buyer persona” or helping their teams understand what drives each role they sell to. For example, “purchasing” is impacted by _________, and the “plant manager” is impacted by this ________ (when talking about a product you sell).
What ’s challenging isn’t identifying influencers (i.e. the people you sell to), it’s engaging with them, and not realizing how not engaging with an influencer completely changes your positioning in moving a sale forward. Simply knowing someone exists and is involved in the decision-making process isn’t enough, you need to ENGAGE with them.

Mis-handing sales tools with the wrong people

Today there are more buyers involved in a single sale, it can be difficult to allocate which tool to leverage, with who, and when. Sales tools are defined in our world as anything you use to differentiate or explain something about your product, service, or both. Traditional marketing material could be considered a sales tool, so could success stories, testimonials, personal experiences, or a specific feature description.
Salespeople can easily sabotage themselves by trying to leverage a certain sales tool with the wrong decision influencer (or “buyer”…whatever you call a person involved in the buying decision). Based on my experience, software salespeople do this quite often (as do many of us salespeople). They’re quick to talk about features of their tool without understanding how someone will use it (if they will at all).

Forcing a demo, slideshow, or deck instead of discovery conversations

Based on our conversations with the market, buyers are tired of being “shown” the next demo, deck, or slideshow from salespeople. Sales meetings are twice as long as they need to be because strategic discussions are not happening.
Instead, ask for a 15-30 minute discovery conversation to help your audience understand how you can impact their business, show off credibility, and exchange questions to shape their vision. Make it a conversation between two or more people, not a show and tell.

Not reminding their prospect of reasons for a change, from start to finish

A reason for change is called a trigger event. Trigger events are reasons for change that your audience experiences on their own or you help them realize. This is the cause of a buying decision. Without identifying a reason for change, or creating one, it’s likely you’ll be treated like a commodity, chase quotes or “science projects” as I call them, or both.
Continuously remind your audience of the reason for change they’ve shared throughout your conversations. DO NOT expect them to remember the one or multiple challenges they have, that’s your job. As a professional salesperson, you’re on the lookout to determine your prospect or customer’s priorities have changed as time goes on. Most salespeople I know would say their sales cycle is months, not just days. So it’s important to keep track of this data by verifying during conversations.

Basing their positioning off of gut feelings or emotion, not data

“They loved the presentation and are really excited about what we could do!”
That gut feeling and emotional response don’t make VP’s very happy when forecasting. Remove the “Grey Area” when it comes to talking about sales.
What did you want to accomplish? What did you accomplish? What’s going to happen next? What are you going to ask for? These are all binary questions for planning a pursuit.

Not asking for the next step

Too often we think we’re asking for something, but we’re leading with information. Why is asking so difficult anyway?

Not proactively seeking coaching from their manager

Always be looking for ways to improve.

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Add this skill to blow away your Q4

Add this to your Q4 plans immediately – We can Help

Many of your training and sales leaders are looking how to squeeze every little bit of training, travel, and sales improvement budgets you have left available for the year.

It’s November. Mid Q4; some start to sweat, others are cool and confident in their forecasts and plans.

I’m going to throw you a monkey wrench. Here’s an area of training you’ve not considered…

 

Teaching your team how to ASK with influence and confidence.

In Q4 we will improve your sales team’s ability to ask for what they want and get it.  How would your year-end results be impacted if your sales team was proficient at asking:

  • For the order
  • For the next project
  • For the next meeting
  • To be specified
  • For more of the customer’s business

 

These are real “asks” as we call it.

Like you, we take a hard look at the training industry and what it has to offer. So many sales teams invest in “sales training” to teach them negotiating, buyer profile, prospecting, branding, social selling, and anything else that’s offered in the wide and deep sales effectiveness vertical.

However, how many of those training topics come second to being able to ask for what you want?  How much more effective would your sales team be if they were skilled at developing and delivering influential asks?

Dave Varner and I took a step back and realized that salespeople were coming out of multiple day sales training programs but still couldn’t confidently ask for the order, price increase or even a meeting. That sneaky “gut feeling” of nervousness negatively impacts our level of confidence and influence. It’s the same feeling we had when we had to ask someone out on a date for the first time.

It doesn’t go away. As we age and grow our personal brand and status, the need for asking (not questioning) for an action doesn’t go away. Yes, this is a plug for our workshop, but it should also be a wake-up call to your training curriculum. Our clients come to understand that a sales team without the ability to effectively ask for what they want and get it, cannot maximize their previous investments in training.  Their “ah-ha” moment is that the training they deliver is HEAVILY dependent on the participant’s skills to effectively ASK for something from their customers, prospects, and internal support teams.

Give us 6 hours and we will provide your sales organization with a skill that will move the needle immediately.

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How to Increase your Sales in Home Healthcare …in 3 Minutes!

Background

Selling in the home healthcare arena presents unique challenges.  Most salespeople come from caregiving backgrounds, not traditional sales roles.  As such, most do not view themselves as conventional salespeople.  This makes it easy for them to focus on the caregiving side of their roles, i.e. their comfort zone, and not the selling aspect.  As we say, they’re more comfortable with the “science than the selling.”  That combined with the fact that the time in front of the decision maker, often a physician, can be as little as 30-60 seconds, presents unique challenges to overcome.

The Challenges

To be effective, a home healthcare salesperson must be effective at asking physicians, hospitals personnel, skilled nursing facilities management, discharge planners, insurance companies and case managers for actions such as:

  • Referrals
  • Meetings
  • To be a primary source
  • To be a secondary source

3 reasons why asking for referrals is difficult for home healthcare sales representatives:

The goal for most home healthcare salespeople is to obtain patient referrals.  However, getting a referral requires the person to ask for one.  Sounds simple, doesn’t it?  So why doesn’t it happen?

1) No one has taught them the skill of asking.

2) Most don’t view themselves as traditional salespeople; asking is often considered too salesy, pushy and uncomfortable.

3) The salesperson often only has an extremely short period of time to ask a physician for a referral.

Is it any wonder why they are not effective at asking?  Is it any wonder why there is often high turnover?

While it’s common practice to plan for sales calls, most of the time salespeople do not identify the specific action they want the customer to take as a result of the call and how they are going to ask for it.

I see this all the time. Often when I’m coaching clients and ask them what they are going to ask for during the call, I get a list of questions.  Asking questions is necessary to help you identify pain points, or trigger events.  Asking for an action is completely different.

 

A quick story will reinforce this point.

A customer of ours developed a list of questions for their salespeople to ask clients.  Their goal was to obtain referrals from physicians, caregivers, etc., to use, or try, their services.  They routinely captured the basic questions such as how many patients, what are they doing now, what would they like to improve, etc.  When coaching them on their sales calls, it became apparent that salespeople were not actually “asking” for the referral.  They felt their role was to ask questions and deliver their presentations.  Surely, if someone was interested, they would ask to do business with them.  After it became apparent that nobody was actually asking for a referral, we coached them on the key elements of an effective ask.  This approach was especially appealing to the salespeople who often came from the caregiver side of the business. Initially, they were not comfortable with the idea of asking for a referral.  It was only after they understood that an effective ask is based on the WIIFM for the recipient (enhanced patient outcomes), did they embrace the idea.

The results were outstanding.  They learned to deliver an ask that solved a problem specific to a physician, or other decision influencer, to whom they were selling.

 They’re happy that their competition is still just asking questions and not asking for the referrals.

Understanding that questions are designed to get information and asking is designed to get an action, will enable you to incorporate both into your customer interactions and immediately improve your sales results.

 

How does your sales team currently ask for referrals? 

The Solution

As with everything involved with sales should be, the solution must be simple; simple gets used, complex does not.  Make no mistake, there is sophistication in simplicity.

How can you or your team become better at asking? There are 4 key elements to an effective ask:

1) What do you want?  What action do you want as an outcome of the call or visit?  If it’s a referral, plan your ask around gaining a referral.

2) What issue are you solving for the decision influencer?  If you’re asking a decision influencer to make a change from what he or she is currently doing and begin giving you referrals, what problem are you solving for them?  If the physician doesn’t perceive any issues with what he or she is currently doing with their referrals, such as excessive patient readmissions, they are not going to make a change.

3) How do you and your organization uniquely address this issue?  What about your brand and services are different and apply to the issue?

4) And finally, WIIFM (What’s In It For Me?) for the decision influencer.  If you’re asking a decision influencer to make a change such as to begin giving you referrals, think about what’s in it for this person.  If it’s a physician, how will granting you referrals positively impact them?  For example, improved performance rating through decreased patient readmissions.

 

Now all you or your team need to do is to ask!  As Ghandi said, “If you don’t ask, you don’t get.”

Simply taking a few minutes prior to every sales call to think about what you want, the issues facing the person you’re calling on, how you and your organization addresses these issues and finally, what’s in it for the person, will immediately improve your sales results – assuming you ask for it!

Simple, isn’t it!  Good luck!