Measurement has only recently become an integral part of what marketing and sales people do.
Why do we need to measure? How is knowledge of quantitative relationships more valuable than personal experience and the observations of others?
Let’s start with Michael Webb’s explanation:
“The purpose of measurement is to expand the range of conscious awareness beyond the perceptual level—beyond a single person’s ability to perceive directly.”
Measurement expands our awareness in two ways.
Measurement makes you aware of information that you cannot perceive directly. For example, you can’t directly see the close rate for your sales reps. You only know the close rate after you measure the number of sales opportunities, the number of wins, and then calculate the win/opportunity ratio. When you calculate the ratios and then compare them across your sales staff and across different periods of time, the information expands your awareness well beyond what you could perceive directly. Sales process improvement rests on a foundation of measurement, ratios, and analysis.
The second way that measurement expands awareness arises from our collective observations. By ourselves, we can only observe what is nearby. The same is true for each person on a team. What’s more, each person’s experience is a little different. But this variation in viewpoints changes when we agree on what to observe and how we will collect our observations. With this agreement the team can assemble a broader view that let’s everyone see the collective experience of the whole group.
Webb explains it this way: Many people are involved in a business and agreed-upon measurements expand everyone’s understanding of the situation. It’s like “shifting focus from the trees to the forest while ensuring the picture is grounded in reality and not just abstractions floating in our heads. It is the essence of rational thinking.”
Collecting measurements at each stage of the buyer’s journey let’s us establish a baseline of the team’s performance so we can make comparisons. It gives our experiments in process improvement a reference point. Measurements enable everyone to see the answers to the vital questions in a sales production system:
How do we know which activities are creating value and which are creating waste? How are the activities performing against the goals and objectives? Howcan we improve their effectiveness and efficiency?