Measuring Sales Relationships but not by Value

measuring

Many organisations measure their sales efforts in too binary a way – they either have work from other organisations or they don’t. I think this is a mistake. It encourages a particularly pushy style of selling, to get their contacts to buy.

This approach is particularly inappropriate for complex, high value and repeat products or services, where the service provider needs to be seen as a trusted adviser. In many businesses, it can take months or years to win work from a rival firm.

Then, of course, what makes matters worse is that the accountants in your firm will want to measure the sales value (and the write off’s and margins).

On top of that, management tends to reward those who sell more than others by giving them a promotion or bonuses.

This culture and method of measuring and rewarding business development might not be encouraging the right behaviours. Why should anybody focus on building a relationship with a new large company where it might take 3 years to win the work when there are easier pickings from an established, though perhaps declining, client?

Here’s the answer. It’s a 10-point measurement scale and a way of putting a value on the progress of developing a relationship with a contact over time. And I think it’s totally objective. After all, there’s either evidence that the contact has returned calls or emails or there isn’t.

0 = we haven’t met them and they have probably not heard of us

1 = we have spoken on phone or sent an email

2 = they are returning our calls/emails or reading our e-newsletters 

3 = we have met them

4 = they know us well, what we do and that we are good

5 = they have said they will use our services when they have a budget

6 = they have asked for a proposal

7 = they have instructed us once

8 = they have instructed us more than twice

9 = they have referred us to other parts of the organisation

10 = they have recommended us to other organisations

Each person with responsibilities for building client relationships should set a target for their contacts – perhaps moving Joe from level 4 to level 8 over the next 12 months. At performance reviews it will be perfectly possible to assess whether objectives have been reached or not.

If the specific targets associated with my 10-point scale don’t work for your firm, I’m sure you could design your own scoring system.

As an aside, it seems to me that many established clients only get to level 8 and don’t make any referrals. That’s a shame. The best business development is usually a loyal client saying great things about you to others in the marketplace. It’s more convincing that you saying great things about yourself! So get your key relationship managers out there looking for shifts from clients from level 8 to level 10!

 

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