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Lean sales represent a significant deviation from classic sales. Lag measures such as Orders Booked and Net Sales remain the same, but lead measures are different. You need a good idea which metrics to start with. An important part motivating your team is to see if you are winning it not against the target metrics.
Metrics for everyday use
Lean sales has the potential to drive incremental progress across all flows. The progress need to be measurable and measurable in detail to allow sales teams to improve daily. The lead measures you select has a large impact on which improvements you will see.
When selecting metrics you look for relevant, granular and easy to understand metrics. The relevance is the trigger. Your team members need to see the metrics as their scoreboard as “players” rather than a scoreboard designed for a coach. The granularity allow for daily deliverables and many small incremental improvements.
Metrics stability over time
As we build structures to last, we need to put the same expectations on the metrics. It is worth the effort on how to measure if your team is winning or not. Structures and aligned metrics designed for the long run will serve as anchor points for improvements
If we compare with sports it is fair to expect the games to get more sophisticated if you rarely change the rules. Once you start changing the metrics players get less focused on optimizing the game at hand.
Compensation to lean sales teams
Sales, together with procurement, are the two most number driven parts of an organizations today. Part of these measures translates into variable compensation plans. As you adopt lean sales you should expect a demand from teams to see the new metrics reflected in compensation structures.
You can argue these new metrics driving improvements should be a center piece in the compensation. But since lean often equal lead metrics the classic lag measures OB/NS remain the primary goal.
Questions for you and your team
1. Which lag measures do we manage towards today – keep the to secure you can measure progress between old and new.
2. Which metrics are most relevant for our team – a brainstorming is likely to generate a strong gross list.
3. How would we prioritize the identified metrics candidates – assume a too large amount upfront,
4. Which metrics are linked and how do they support the lag measures – always break them down from the lag measures.
5. Which metrics have potential to be long lasting – experiment early but have a clear ambition from start to find long lasting metrics.
- Lean Key Performance Metrics [SLIDES] – by Lean Enterprise
- 7 lean metrics to improve flow [BLOGPOST] – by Leankit
- The top 6 considerations when applying lean to sales force compensation [BLOGPOST] – by CM Global Partners