Smart Selling Tools: Sales Waste and the Production Line Theory of Revenue Generation

July 9, 2013- 

By Nancy Nardin

“The undirected worker spends more of his time walking about for materials and tools than he does in working; he gets small pay because pedestrianism is not a highly paid line.” Henry Ford

Henry Ford is of course renowned for forever changing the way the automobile industry manufactures cars. Ford hated waste and saw it as the underlying cause of both high automobile prices and poor wages. In the beginning, automobiles were built by craftsmen who assembled the finished vehicle from parts they themselves had made. These craftsmen produced splendid cars, but this method of manufacturing kept the Ford Motor Company stuck between the desire to serve the masses and the unrelenting reality of high-cost manufacturing.

On the road to mass production, the most significant event was when they first began taking “the work to the men instead of the men to the work.”

Ford had 3 principles for eliminating waste in the assembly process:

1. Place the tools and the men in the sequence of the operation so that each component part shall travel the least possible distance while in the process of finishing.
2. Use work slides or some other form of carrier so that when a workman completes his operation, he drops the part always in the same place—which place must always be the most convenient place to his hand—and if possible have gravity carry the part to the next workman for his operation.
3. Use sliding assembling lines by which the parts to be assembled are delivered at convenient distances.

Producing revenue is most certainly a far different animal than producing cars. However, we would do well to consider how we might increase our own sales production, carve waste out of our revenue manufacturing processes and optimize our sales capacity. If we did so, perhaps we can start a sales revolution—a true Sales2.0 World.

For the most part, salespeople still work as craftsmen.
They are almost solely in charge of converting raw materials into a final product. In order to work on manufacturing more than one sale at a time, they must constantly reassess and prioritize tasks, re-focus and re-calibrate their mental resources across all of the different opportunities that are making their way through all of the many sales stages.

Let’s continue with this premise. Imagine that salespeople run their own production lines and each prospect represents the core makings of an end- product (revenue). When the prospect (the raw material) is qualified, it begins its journey down the assembly line (the sales process/cycle). The conveyor belt (time) continues to churn whether or not any new action is being imposed on the prospect opportunity. The longer the opportunity is on the production line, the closer it gets to the end of the line. If the raw material is transformed into a final product (revenue) by the time it reaches the end of the line, it is delivered to the paying customer (the company or share-holders). If it is not transformed to revenue in time, it is either discarded as wasted materials (a closed-lost deal) or it is moved back down the line wasting precious time (forecasts slip).

Continuing with this analogy, salespeople must aim to keep a production line at capacity by first sourcing their own raw materials (leads and prospects) and then by doing their own QA checks (qualifying). This must happen before production can begin. If not enough prospects are available, then there is wasted production capacity. The goal is for each salesperson to keep their line moving at capacity.

Management can increase production by doing one of two things; 1) ensure that more opportunities are transformed into revenue (reduce wasted material) or 2) expand the number of production lines to handle a larger capacity of opportunities (hire more salespeople). However, even if they can accomplish this, there is substantial waste left in the sales production process.

That’s because, while both actions result in a higher “manufacturing” volume (more opportunities can be worked), we haven’t yet addressed a major drag on production efficiency (opportunities are still converted to revenue at the same average speed).

Shortening the sales cycle: Increase the speed at which each opportunity is converted to revenue

In a typical manufacturing production line, raw materials are transformed virtually non-stop until the final product comes out at the end of the line. In the sales production line, opportunities are incrementally transformed in a stop-and-start fashion. Nothing actually transforms an opportunity into revenue except prospect interactions. And prospect interactions do not occur continuously during the production process. Time marches on in between interactions while salespeople create proposals, work to schedule meetings or coordinate resources, or while they strategize on what has to happen next (every sale is, in effect, a custom product).

The key for managers is, therefore, to 1) increase the number of prospect interactions of the kind that 2) propel opportunities toward revenue. High quality prospect interactions are the ball-bearings of the sale process. You can either leave salespeople to their own defenses on this matter, or you can figure out, as a company, how to eliminate wasted time and effort and develop instead, a more efficient and effective way to produce revenue.
There are a number of inflection points in the sales process where waste can be eliminated rather quickly and as a result, they are the areas I recommend companies address first.

Electronic signatures – there is simply no reason to continue with a manual paper signing process that forces both customers and sellers to waste needless time “pushing paper.” Sending documents for manual signature is equivalent to shipping cars across the country by horse and buggy. Instead, get your team DocuSign accounts.

Prospecting tools – When it comes to prospect research, Google is like a parts bin; salespeople dig around sifting through a sand dune of parts until eventually, they find the one they need. Instead, use a tool like OneSource. With these services, “parts” are already sorted and ready for use. Salespeople can do electronic searches for contacts and prospect intelligence with instant results.

Proposal tools – Don’t keep your salespeople firmly entrenched in the craftsman role. They shouldn’t be hand-crafting proposals and meticulously polishing them by hand. They should instead, have access to tools like iQuoteXpress or PROS Quote2Win which will do much of the work for them.

Mobile Sales Call Reporting tools – If managers are to supervise production, they need to see where and when problems are developing. For this, they need information. Unfortunately, it’s the salespeople that must stop the production process throughout the day, week, and month to log information into call reports and CRM systems. Significant waste can be eliminated in this process by using a tool like Front Row Solutions or Salespod.

Henry Ford created the modern day manufacturing line where over-head conveyor belts transport parts to stationary workers each trained in one specific stage of the production. We can’t exactly pass prospects down a sales process in our own (standardized) time-frame nor can we place salespeople up and down the sales process each one specialized on a small sliver of tasks required to convert opportunities into revenue. Should we not consider, however, what there is to glean from Henry Ford’s obsession with eliminating waste in manufacturing? Aren’t there lessons that we would do well to learn from, lessons that might lead the sales world into a new, more modern way of optimizing sales capacity and generating revenue?

Nancy Nardin is the foremost expert increasing sales productivity through the use of tools. As President of Smart Selling Tools, she consults with many of the top sales productivity software vendors as well as end-user organizations looking to select the right tools. Click to get Nancy’s What & When weekly digest with invitations to complimentary webinars and informative publications. Follow Nancy on Twitter @sellingtools or subscribe to her Sales Productivity blog. Nancy can be reached at 916-596-3035.