Friday, November 24, 2006

Tips for Sales Managers from Marketing Headhunter

I'm catching up on my reading during this Holiday week here in the States. Harry talks about understanding the difference between revenue and profit. He provides some very specific tips on how to boost your bottom line profit numbers.
If you are a sales manager who is looking for new career opportunities, please take a look at your accomplishments in light of these suggestions.
  • To what extent have you improved your employer's profitability by helping it get its arms around its costs?
  • Have you developed and implemented any systems to track revenues, costs per sale, and net profits?
  • Have you partnered with your customers to lean-up the value chain?
When I joined my current employer, I took over a $16mm piece of business. We tracked revenue. That was it. Since taking over, and fighting though and around a development group that has bigger priorities we have laid in some new and knowledge-generating reporting. We look at conversion rate now. The first thing we learned is that there is a lot of "spray and pray". Lots of random, unqualified leads. We begun an immediate continuous improvement effort on that.

Secondly, we now look at the aging of the leads. Guess what...if a lead is open past 90 days, it ain't gonna close. Ever. More effeciencies gained there. No more effort wasted in trying to contact people. And then we tie it back to conversion rate.

Next up for us is churn. My revenue number gets adjusted month to month. But it is difficult to get at a good churn number. These measures (and a few others that we have implemented helped to "lean up the value chain". After that: cost per lead and cost per sale. We are building a nice name for ourselves. This group was once the convenient whipping-boy between marketing and the field. No longer. We are advocates for both groups.

After a half-year of operations center closings and announcements for more, we are at break-even from 2005. I'll take it. Since the second quarter, we were struggling. We turned it around by managing it.

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