Applying process improvement to the art of sales
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Applying Process Improvement to the “Art” of Sales. Air Products University. Reduce L&D costs in support of organization objective to achieve 13% (RONA) Return on Net Assets Organized L&D by colleges that align to organization core processes Created Shared Services organization.

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Applying Process Improvement to the “Art” of Sales

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Applying process improvement to the art of sales

Applying Process Improvement to the “Art” of Sales


Air products university

Air Products University

  • Reduce L&D costs in support of organization objective to achieve 13% (RONA) Return on Net Assets

  • Organized L&D by colleges that align to organization core processes

  • Created Shared Services organization


Sales training

Sales Training

  • Complex selling process at Air Products

    • From selling tanks of oxygen to entire gas production plants that are built on client’s site

    • Sometimes long sales cycles managed by deal teams

  • Doug Timmel - College Leader for Sales

    • Analyzed the sales process and began to align L&D needs to sales process steps

    • Discovering how to apply L&D as a continuous improvement mechanism to improve the sales process


Applying process improvement to the art of sales1

Applying Process Improvement to the “Art” of Sales

Case Study: Air Products and Chemicals

Douglas Timmel

February 16, 2006


Fast facts

Fast Facts

  • Global gases, chemicals,

    equipment and servicesprovider

  • Serving customers intechnology, energy,healthcare and industrialmarkets

  • Fortune 150 company -- $8B sales

  • Chemical industry safety leader

  • Geographically diversified, with half of our sales outside of the U.S.

  • Operations in more than 30 countries

  • 20,000 employees worldwide

  • Known for operational and business process excellence.

  • 15 Different Sales Organizations, 17 SBUs


What is a sales process

What Is A Sales Process?

The Gartner Group defines a sales process as the “Critical steps in selling linked together …[to] … provide the common framework, vocabulary and metrics for how sales organizations review and analyze territories, accounts, opportunities, individuals and sales cycles…”


Why focus on sales process

Why Focus on Sales Process?

  • A well-managed sales process helps to improve visibility, predictability, consistency, scalability and sustainability, which often translates into a competitive advantage.

  • The reality is that selling in today’s complex environment requires a coordinated effort and team approach, making a standardized sales process all that more important.

  • Training must support competency development, which must support process improvement, which lead to better sales performance.


The problem

The Problem….

  • The challenge for all sales organizations is to grow revenue in a predictable, consistent manner and sustain performance over an extended period of time.

  • The Sales Manager’s challenge is to improve the effectiveness and productivity of the Sales organization so revenue and margin DO increase.

    How to do this in an increasingly difficult Sales environment?


The new selling environment

The New Selling Environment

  • Increased competition with lower cost basis

  • Consolidation of Purchasing companies

  • Buying Decisions by committee and moving up to the “C” level to make final decisions

  • Transparency of information

  • Same number of Suppliers and competition intensifies

  • Opening up new markets and establishing a sale presence where a history of sales processes is not established.

  • Pressure on Cost of Sales

  • Increased emphasis on Supply Chain Efficiency


The selling environment has changed does sales have skills

The Selling Environment has Changed...Does Sales have Skills

  • To Sell at the “C” level?

  • Understand and be able to “Sell into” a customers Value stream?

  • Have a discussion with the customer on how the offering may affect the customers financial performance?

  • To be able to sell to a purchasing committee with many buying influences?

  • To sell into complex, global accounts with multicultural buyers with different expectations?

  • Be able to sell (and keep) price increases in a very dynamic cost environment?

  • To understand the cost impact of supply chain and service levels, and the vale of forecasting ?

  • To understand the Value of a robust sales pipeline?


By implementing a single sales process and training approach

By Implementing a Single Sales Process and Training Approach

  • Improved and standardized sales pipeline, with clear visibility and forecast accuracy.

  • The ability to replicate and scale best practices and learning across the organization.

  • Improved communication, cooperation, coordination and, resource allocation.

  • Improved win rates and sales velocity

  • Lower cost of sales and sales training

  • Common assessment of competencies

  • New hire training ramp up time and an accelerate ROI payback period.

  • Increase in sales productivity and effectiveness.


Case study how air products implemented sales process and results

Case Study How Air Products Implemented Sales Process and Results


Key business issues for ap

Key Business Issues for AP

  • All the same challenges facing other selling organizations,

  • No Alignment of Sales Processes

    • Many sales processes, little documentation

  • No holistic or consistent Sales Training approach, all training “ad hoc” at SBU level

  • SAP “Steamroller” created a burning deck

    • Connections from SFA/CRM tools “broken” by move to SAP

    • Lost visibility of customer data

    • Previous systems were a myriad of CRM applications


Our path

Our Path……..

  • Implementing SAP provided the opening to define a single sales process for the company

  • Sales Process was established and agreed

  • Established an Enterprise Approach and converged on crucial decisions such as opportunity stages and corporate metrics.

  • Tool was chosen to help measure KPIs and become shared vault of “customer knowledge”

  • Agreed to begin a single, global, Sales University where all Sales Managers could send their salespeople, agents, distributors.


The selling process at ap two distinct sub processes

The Selling Process at AP Two Distinct Sub-Processes

  • Find and Win Customers – Leading Indicators

    • Provide an Indication of future success

  • Retain Customers – Lagging Indicators

    • Provide Revenue and Profits to the Company

    • Provide the Forecast to the Supply Chain

    • Supply the correct inputs for Perfect Order Fulfillment


Level 3 process find and win customers

Level 3 Process“Find and Win Customers”

Inputs to SELL

Market model

Offerings (from INNOVATE)

Business objectives

Output to FULFILL

Valid and viable customers

Process Steps

1

2

3

4

5

6

7

Identify Opportunities

Develop Relationship

Review Requirements and Engage Organization

Develop and Submit Proposal

Obtain Commitment

Establish or Modify Customer Account

Process Contract Information

Outputs to Next Process Step

leads / sales target list

prioritized list of qualified leads

decision to offer or not

proposal in hands of customer

agreement to do business

approved customer account

contract data input to SAP

relationship

confirmed customer requirements

configured offering

Move Data to SAP

Needs

Assess

Leads

Qualify

Proposal

Close

P

Neg.


Enterprise process enterprise tool

Enterprise Process = Enterprise Tool

  • Business Rules Can Drive the Process

  • Sales force automation tool Overlays the Process & Allows for Business Rule Inclusion

All Businesses use the SAME Stage field!


Ap leading indicators align to find and win customers

% Leads Becoming Prospects

Revenue Potential from Prospects

Revenue potential in pipeline

A) By Salesperson

B) By Segment

Number of Customer Touches

A) By Segment B) by Time Period

Sales Cycle Time on New Opportunities

Won/loss % on new opportunities

% Contract renewals

AP Leading Indicators Align to “Find and Win Customers”


Examples of leading indicators

Examples of Leading Indicators

  • Customer Touches

    • Increase of 72% from May through August!

  • Opportunity Pipeline Stage Analysis

    • First time we have analysis across company


Kpi won vs loss

KPI – Won vs. Loss %


Sales cycle time by sbu

Sales Cycle Time – by SBU


Ceo dashboard

CEO Dashboard


Examples of level 4 processes for find and win customers

Examples of Level 4 Processes for “Find and Win Customers”

Find and Win Opportunities...

Identify Opportunities

Develop Relationship

Review Requirements and Engage Organization

Develop and Submit Proposal

Obtain Commitment

Establish or Modify Customer Account

Process Contract Information

Create leads

● Build awareness in the marketplace

● Collect leads

● Validate leads

● Distribute leads

● Act on leads

● Collect data on lead quality and quantity

Pre-Selling

  • Build personal marketplace recognition

  • Establish / expand marketplace contacts

  • Discover needs

  • Understand needs

  • Understand buying habits

  • Identify decision makers

  • Build relationships

  • MAKE SALES CALL

  • Screen opportunities

  • Evaluate competition

  • Match offerings / capabilities to customer need

  • Create interest in offering

  • Support customer’s RFQ creation

  • Respond to RFQ

  • Prepare / engage organization for offering development

  • Develop cost estimates (link to CIA processes)

  • Approve pricing and proposal

  • Prepare proposal documentation

  • Submit and present proposal

  • Solicit feedback on proposal

  • Negotiate

  • Analyze and revise offering

  • Develop contract

  • Close

  • Collect feedback on won / lost orders

  • Develop lessons learned

  • Approve project

  • Complete documentation

  • Complete, review, and approve customer information in workbook

  • Recognize / reward success

  • Document contract information in workbook


Find and win level 4 processes drive behavior and outcomes

Find and Win Level 4 Processes Drive Behavior and Outcomes

Make Sales Call

Skills needed:

Pre-call planning Setting appointment Opening statement Probing

Training required:

Sales call Methods Questioning skills Listening skills

Key Outcome: Process Definition and need to Drive Continuous Improvement has Allowed AP to Justify a Sales University


Level 3 process retain customers

Level 3 Process“Retain Customers”

Inputs from SELL

Of a WON CUSTOMER

Output to Fulfill

Valid and viable customers

Output to Supply Chain

Demand forecast

Process Steps

9

9

10

11

12

13

14

Segment Customers

Monitor Segment / Customer Performance and Feedback

Analyze Gaps and Engage Organization

Authorize and Plan Improvements

Implement and Control Improvements

Modify Customer Account

Forecast Demand

Outputs to Next Process Step

customers in segments

financial performance

improvementopportunities

actions, changes, and expenditures

improvedfinancial performance

customer data / segment changes

demand forecast for Supply Chain

service performance

improvedservice performance

contract data changed in SAP

Results

Improved customer loyalty

Improved segment performance

Obtain Revenue and Margin


Examples of level 4 processes retain customers

Examples of Level 4 Processes“Retain Customers”

Manage Customer Experience

Segment Customers

Monitor Segment / Customer Performance and Feedback

Analyze Gaps and Engage Organization

Authorize and Plan Improvements

Implement and Control Improvements

Modify Customer Account

Forecast Demand

Input from…

  • Customer Loyalty measures

  • Customer Complaint process

  • Periodic performance assessments

  • Feedback from on-going customer relationships

  • Mass price changes

    • Determine need

    • Develop plan

    • Execute

  • Account planning

  • Modify commercial terms, mid-contract, such as…

    • price changes

    • hardship issues

    • force majeure

    • improvements

    • cost reductions

    • term extensions

      etc.

  • Negotiate

  • Close

  • Develop lessons learned

  • Complete documentation

  • Complete, review, and approve customer information in workbook

  • Recognize / reward success


Lagging indicators align to retain customers

Revenue Attainment / Growth

A) year to year change

B) actual total revenue

Actual New Business Profitability

A) by sales territory B) by customer

C) OR by account

Wallet share

A) by customer B) by territory

Price Increase Effectiveness ( within a customer or a territory)

Customers Segmented based on Value/Return

Inputs to Perfect Order Fulfillment

Lagging Indicators Align to “Retain Customers”


The results at air products

The Results at Air Products

  • Enterprise Sales Process, Enterprise Design

    • Business Rules drives the process

  • Insight into Leading indicators of Success & Performance for the Entire company

  • Leading Indicators can be tied to Lagging Indicators

  • Visibility of customers across the Enterprise

  • One Tool for the entire company

  • Have a base to now measure continuous improvement and a justification for establishing a budgeted Sales University for Training


Process improvement is dependent on training

Process Improvement is Dependent on Training

  • Process Steps identify the critical measures.

  • Ability to measure the Process Steps indicates speed to execute, efficiency of execution, identification of best practices

  • Knowing the Process Steps and metrics allows identification of critical activities and competencies to be continuosly improve.

  • Competencies can be established and training defined to allow Sales to execute the process steps faster and more effectively.

  • The Process improvements can then be measured and tracked in Dashboards.


Applying process improvement to the art of sales

Effectiveness

Efficiency

Productivity

Right Markets

Shorter Sales Cycle

Higher Profits/ Sales Rep

Right Customers

Higher Sales Closes

Faster Growth

Right Message

Faster Prod/Offer Dev.

Market Share & Brand

Right Product/Feature

Faster Response Time

Customer Loyalty

Right Competence/Skill

Quality Prod. Delivery

Better Products/Service

Right Process/System

Cost Effect. Supply Chain

Better Capital Control

Having and Executing a Sales Process Effectiveness X Efficiency = Productivity


Benefits for air products

Benefits for Air Products

  • Unexpected cross selling opportunities

  • One unified Sales Training approach tied to Process and measurable with defined metrics.

  • Global visibility on accounts

  • Better forecasting for all of Air Products

  • Better overall competitor assessment

  • Reduced cost of sales and sales training

  • Greater Sales Productivity

  • Eliminated many administrative tasks/costs

  • Better direction to spend on Marketing funds as can assess return on leads.

  • Expect shortened sales cycles

  • Better Alignment of Rewards with Performance

  • Better allocation of spend to customer segment and specific customer opportunities


Conclusion

Conclusion

  • Organizations that effectively align and leverage their people, process, training and technology assets are likely to sustain competitiveness over organizations that lack standardized sales processes and a consistent sales training approach.

  • If you have defined your winning sales processes but have yet to embody these best practices into your company, consider a solution that aligns process to measurements and forms the basis for assessment and training.


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