By Patrick McClure – Excerpt from the book, Cracking the Business Code
I once knew of a company that seemed obsessed with coming up with “Next Year’s Plan.” Every year, the key sales and marketing managers were called in and told that they had to put together “The Plan” for next year, and that it was critical this be completely done and ready to announce to the troops by the end of December. The revenue targets needed to be in place, the organization should be finalized, accounts and territories completed, the bonus plan approved, and everything must be ready to “rock n’ roll” so they could get off to a fast start in the coming year.
Something was missing, I thought. What about the year we’re just completing? Shouldn’t we take a long hard look at what we got right, and where we fell short? Shouldn’t we take a pause, look deeply into our performance, and critically evaluate our performance before we dash willy-nilly into planning for the future?
Fortunately, wiser heads prevailed and this company, a leading technology firm, decided to perform a thorough analysis and because of what they learned, were able to chart a much more accurate path into next year’s sales success. What about your company?
The Seven Step Sales Diagnosis Plan & Sales Performance Assessment
Here’s an easy-to-use template to follow in conducting an analysis of how you performed last year. You can focus this analysis on sales and/or marketing, or you can use it to analyze other departments or the entire company. If completed thoroughly, it will provide valuable insights, which can be used when building your next year’s sales plan or adapting your current one. Later in this article, you will be able to take a sales performance assessment.
1. Sales Objectives for Year ______ and How Many Were Achieved
These are the “big picture” goals and objectives that you established at the beginning of the year, and they were targeted to be accomplished during this year. Some examples might be:
• “To Grow Revenue in the Southwest Region by 25%”
• “To expand our sales team by adding two new Sales Executives”
• “To open a new office in New York”
• Go through the list and check off which were achieved and you’re done!
This is where you examine your actual sales numbers and compare them to your targets. There are dozens of programs to conduct sales analysis, and you should have ready access to these figures. At a minimum, you should evaluate the following:
• Total Sales Revenue Achieved as a % of what was assigned
• Total sales by rep/region versus what was assigned
• Comparison of these sales results to the past five years’ results
• Amount of Revenue from new accounts versus total revenue (Growth)
• Key Sales Ratios:
- # of inquiries that convert to qualified opportunities (% qualified)
- # of qualified opportunities that closed (the closing ratio as a %)
- Average order amount
- Average time to close an order
- How many opportunities are in the pipeline?
Of course, you can spend a lot of additional time digging deeper into these numbers, but the above will give the management team a good snapshot of sales performance and results.
3. Highlights for the Year
This is a review of the highlights of the previous year or planning period with particular attention paid to any strategic achievements. Included here would be key achievements and a brief explanation of why they occurred, i.e., number of new accounts, new business vs. sales to existing customers, improvements in recurring revenue, changes in client size, wins vs. competition, market share, etc.
4. Lowlights for the Year
The next part reviews the lowlights of the previous year. Included here are the key shortcomings and a brief explanation of why they occurred. While this section can be “painful” to review, it has the benefit of helping focus on areas offering potential for improvement and frequently points to areas that, once improved, offer significant payback.
5. SWOT Analysis
The next section is a SWOT Analysis. It details strengths, weaknesses, risk assessment (threats), and opportunities for the coming year. Given the highlights, lowlights, and challenges you are facing, where are the best opportunities for you to focus on in the coming year.
An example of a SWOT analysis for a small manufacturing company:
|• Custom manufacturing excellence||• Lack of marketing & advertising|
|• Management team experience||• No sales management|
|• Experts in industry||• Management conflicts and churn (lack of stability)|
|• Products built to last forever||• Weak sales volume|
|• Engineering excellence||• Minimal lead generation|
|• Loyal staff||• Lack of CRM, accountability|
|• Strong customer base||• Weak manufacturing economy|
|• Rebranding||• Lack of funds to travel|
|• Capturing new markets||• Brand not visible in marketplace|
|• Increased marketing and social networking to drive leads||• Competition|
|• Develop outsourced services||• Morale problems due to low production and revenue|
|• Increase service revenues, support contracts, upgrades, spares||• Uncertain economic conditions|
|• Excess capacity to utilize||• Not a full service solution set|
|• Not keeping pace with technology|
6. Top 3 Problem Areas to Fix
Given the above analyses, it should become evident where the problem areas might be. In the sales arena, you would look for where the biggest LOSS of customers/prospects occur, or where the sales team is most challenged. For example, you might find that your salespeople are excellent at presenting their product/services, but they may be weak at finding and developing new business. Or, the challenge for your team is weakness in handling common objections, resulting in failure to close sales. There are a myriad of potential problems; you are looking for the “top 3” that, if fixed, will result in huge improvements in performance.
7. Top Three Opportunities for Growth
On the plus side, you should also uncover some “silver bullets” that will allow you to rapidly grow your business and capture market share. One of my clients learned that they were not sending copies of invoices from inside sales to their outside sales reps, thus creating confusion among their customers and losing potential upside business. They were sitting on $2 million in potential business locked away in file cabinets at headquarters, and they didn’t even know it!
Take advantage of this time, right now, to highlight your top three biggest growth opportunities. Later on, you’ll develop sales strategies and campaigns to take advantage of these high-potential areas.
Patrick is offering complimentary 30 minutes over the phone to provide a sales operations assessment to identify likely root causes of sales productivity issues with at least three actionable ideas. You will discover critical problem areas, recognize underlying causes of these issues, learn at least three new ideas to implement and begin a plan of action. To learn more, email firstname.lastname@example.org.
Permission is needed from Lighthouse Consulting Services, LLC to reproduce any portion provided in this article. © 2021
Patrick McClure, Sr. Sales & Customer Service Consultant of Lighthouse Consulting Services, LLC, is a speaker, trainer, consultant, and author who enjoys working with individuals and corporations to help them achieve maximum performance. He has dedicated his practice to helping others become more successful. Over the past 30 years, Patrick has trained customer service teams, salespeople and managers to drive breakthrough sales results using innovative and practical techniques. He has a knack for reducing the most complex problems to utter simplicity, and showing his audience exactly how to start winning. During his corporate career, Pat sold over $250 MM worth of products and services at corporate giants such as IBM, Hitachi Data Systems, EDS, Digital Equipment and mid size companies. He is a black-belt master at selling complex business solutions to C-Level executives. As the author of 3 books on selling, Patrick passionately and patiently serves up his wisdom to readers, clients, and audiences. He caters to both small and large firms seeking to help companies to serve and close more business. To contact Patrick, please email him at email@example.com.
If you would like additional information on this topic or others, please contact your Human Resources department or Lighthouse Consulting Services LLC, Santa Monica, CA 90403, (310) 453-6556, firstname.lastname@example.org & our website: www.lighthouseconsulting.com.
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