Wax on, wax off. - Mr. Miyagi, from the film “The Karate Kid”
Two hundred years ago, expert craftspersons didn’t need a lot of process to produce a product or service. Whether it was a butcher, a baker, or a candlestick maker, they were thoroughly familiar with all aspects of their operation and with what their customers wanted.
As the production of goods became industrialized, processes to improve the efficiency, productivity, and quality of manufacturing were developed. Well-known figures like Charles Taylor, Frank Gilbrith and W. Edwards Deming made major contributions to process improvement in manufacturing.
More recently these process improvement methods have been applied to domains beyond manufacturing. These domains include health care, professional services and marketing and sales. Just as manufacturing is a value-adding process which takes raw materials and produces a finished good, Michael Webb explains that marketing and sales is similar. Marketing and sales “takes the raw materials of people in the marketplace who have the kinds of problems your company solves and adds value to them until they are transformed into customers.”
Danny Russo had to learn from Mr. Miyagi that developing the spirit is as much a part of martial arts as training the body. Similarly, we have to study the principles of process improvement methods before applying them to marketing and sales.
You’ll get different lists of these principles depending on which expert you ask. I’m using the principles from Michael Webb in his book Sales and Marketing the Six Sigma Way. I’ll summarize the principles here and then write about each one in a future post.
Creating value for customers. The purpose of a company is to create value for customers, who in turn pay the company for the value received. Companies create value for customers at each stage of the marketing and sales process of finding, winning and keeping customers. Process improvement in marketing and sales is constantly looking for ways to add value for customers at each of these stages in the process. Activities which don’t add value to the customer are discarded.
Managing on data and facts. Process improvement requires more than measuring the end result (sales figures). It means measuring activities and results at each stage of the process. Without these measurements the marketing and sales teams only have opinion and past practice to rely on. By approaching marketing and sales as a process, the organization can break up the process into many steps, measure the inputs and outputs of each step, and discover which steps are most in need of improvement.
Analyzing cause and effect. Once you start to collect the data and facts of your marketing and sales process, you can not only see what is happening, you can start to learn why it’s happening and do something to change it.
Minimizing waste, errors, and defects. In many companies, sales and marketing is a kind of black box. Leads go in one end and customers come out the other, but no one really knows how it works inside. Attempts to increase the number of customers are based on throwing more activity into the front end of the box. Getting a 2% click-through-rate on your search advertising? Buy more keywords. Process improvement looks for ways to remove waste from the system. Are you capturing lots of unqualified leads at trade shows? These are all waste if you can’t find a way to add value to these leads. They are errors and defects if the results are unwanted.
Setting the context for collaboration. It’s common in marketing and sales for groups to believe that the other departments are preventing me from getting my job done. Sales believes that they could make their number if marketing would just give them enough good leads. Marketing perceives that sales doesn’t follow up on the leads they worked so hard to get. Process improvement methods recognize that every activity and result is interconnected. These methods make the connections explicit by making all the activities and results explicit. Once everyone can see what is happening and why, it is much easier to begin working collaboratively to solve the problems.
Companies are accustomed to capturing the major metrics of demand generation - sales quantity, revenue, profit. But these measurements aren’t enough to know what is happening in sales and marketing and why. They aren’t enough to let individuals and groups know what to fix and whether the change is working. Process improvement is the method by which marketing and sales can look at the details of what they do, see how the parts are connected, and improve the quality and productivity of how they add value to customers.
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