Sales Marketing | Sales Improvement Techniques | Mark Woeppel

Manage and Align Performance by Applying Uniform Standards

Mark Woeppel — Thu, 21 May 2015 14:56:48 +0000

The more contractors or departments involved in a project, the more chances for variation and, often, more confusion. There is always the opportunity for misalignment and miscommunication. The larger the organization, the more opportunity for missing cues on priorities and direction. For the process owner, the challenge is to align a team to drive progress towards the goal. For the team member, there is the question of identifying the actions that will drive progress of the entire system; the problem of managing and aligning performance at the global level and local level. To put it more simply, how does the actor at the local level know which actions to take to drive the system towards the global objective? How does the process owner know if his team is doing the right things to move progress towards the goal?

In a more practical sense, if I’m a leader of an organization, how do I know my team is doing the right things? If I’m a team member, how do I know what actions to take?

Every organization is formed for a purpose. In order to achieve its purpose and goals, organizations develop around sub-organizations (functions) and processes that accomplish them. These sub-organizations then have their own purpose and goals, for example; accounts payable’s goal is to ensure the bills get paid. Presumably, each of these sub-organizations is in alignment with overall goals and objectives of the global organization.

As the organization becomes more complex, it becomes more challenging to maintain this alignment, so the organization establishes performance management systems to maintain alignment of purpose and activity among the constituent (local) organizations. These systems are often referred to colloquially as “the measurement system” or “the metrics”. Managers seek the relevant measurements to make decisions and drive appropriate behavior in the enterprise; whether to correct a course of action, direct a new course, or even stop.

The performance management system is the formal and informal process of measuring and responding to the organizational process to achieve its goal(s). It creates and applies uniform standards, quantifying and managing process performance.

Here are a few things to think about.

Establish the standards. Create a common benchmark of performance. This can take the form of a database of work to be done, a common set of objectives, or even an agreed upon set of goals. If you don’t know what the objective is, anything will be acceptable. So be purposeful and deliberate about determining your direction. Essentially, the standard are the “why” of what is to be performed.

Know the process. The process is the “what” of your process – the details that determine your progress towards success. If you have never mapped the process or supply chain, now is the time to do it! It’s essential to know the behaviors required and the results of those behaviors – you can’t measure what you can’t quantify.

Create decision gates. Now that you have the process mapped and can clearly articulate the steps towards the goal, you can identify where decisions need to be made. Quantify the decision process – who can make what decisions and when escalation is required.

Identify the constraint. Now that the process is mapped and all steps are clear, you can see where the bottlenecks are and what is holding up the process or supply chain from moving faster – you can focus on the areas that are most critical.

During the oil spill in the Gulf of Mexico, BP built the largest civilian maritime fleet ever seen (over 14,000 vessels). In the haste of containing the spill, keeping detailed records were not a priority. Equipment was rented and used with no documentation and boats were commissioned to clean oil with no record of their model or serial number. This lack of communication and documentation became a big problem when it was time to decontaminate the cleanup vessels. We employed these lessons to drive the process and completed a task in less than six months that was originally estimated to take years. These lessons worked in the worst conditions, imagine how they could help you now.

Read how we achieved great results by applying uniformed standards in lesson 6 in our eBook, Achieving Top Performance Under the Worst Conditions: 7 Lessons Learned from a Disaster.

Also, have a look at some of our thought leadership on performance management here.

As always if, you have questions or comments please feel free to contact me by emailing me.

The post Manage and Align Performance by Applying Uniform Standards appeared first on Projects in Less Time - Mark Woeppel.

8 Unconventional Things to do When Sales Goes Down

Mark Woeppel — Fri, 22 May 2009 17:01:31 +0000

So you’ve been hit by the economic crisis, eh? Demand has softened up a bit, sales are uncertain. You’re wondering what you’re going to to do with all that extra capacity. You don’t want to lay anyone off, but if sales don’t pick up, you can’t stay solvent. Here are some things you can do to avoid layoffs while keeping the wheels on and position yourself for the recovery.

Focus on customer service. I’m not talking about being nicer, I’m talking about the basics of performance. The number one reason that customers change suppliers is because of reliability issues. Not price, not quality. On time delivery. Are you delivering on time? Are your lead times consistent with the competition? Don’t give your customers a club to hit you with. This is entirely under your control.

I have a number of customers that improved their on-time performance and not only improved the customer service, but actually increased revenues. They became the suppliers of choice simply because they could be counted on to delivery the goods when the customers were in a tight spot.

Build customer relationships. I’m not talking about buying more steak dinners or tickets to the ball game (although building relationships is always good), I’m talking about finding new ways for your firm to add more value to your customers. Take a look at your value proposition. Can you find a way to deliver more value? You have all those skilled people. Can you redeploy them to find new ways of helping your customers? New services? Modifications to existing products or services?

One of my customers was able to increase the amount of business with a key customer because they added a service to keep their product on site for on demand consumption. It cost them very little, but it cemented a critical relationship, locked out other suppliers and positioned them for more business with that supplier.

Conserve cash. Eliminating non-essential spending is a common strategy, but there are other opportunities to improve your cost structure now and position yourself for even better profitability when things turn around.

Look at your receivables risk. Maybe it’s time to offer discounts on those old debts to encourage customers to pay immediately. Better something now than nothing later.
Renegotiate your materials pricing. Now is a good time to re-evaluate your supplier’s performance and pricing. There is never a better time to negotiate long term agreements than when the price is low, just ask Southwest Airlines! They saved nearly$2 B in fuel costs in 2008 because of their hedging strategy.
Look at your compensation strategy, especially sales commissions. Are you paying for results achieved lately or a long time ago? Often we believe that sales reps are due a commission for life. That turns hunters into farmers. In this economy, you need hunters. Are you creating the incentive to generate new business or hang on to old business?
Take a fresh look at outsourcing. Do you have the capability to bring some of that work you had sent offshore back home? Sure, your people cost more, but anything you can do in-house will go a long way to cover your fixed costs and help you retain your people.

Focus sales efforts on the stars in your product portfolio. Don’t waste your effort on selling marginally profitable products. Make sure your sales efforts are geared to sell the products that maximize the highest rate of return. That means focus on the products that generate the fastest return. It may not be the highest margin products that deserve the attention, but those products that earn the highest turnover.

For example, if you have a product that generates $5 in gross margin once a month, it’s not worth as much as a product that generates $2 in gross margin every week.

Reduce your lead times; finish early. Focusing on project or product lead times improves your rate of cash generation. Reducing your lead times also reduces your cash requirements. Less work in process equals less investment equals more cash flow. If you have projects in the pipeline, early finish equals early benefit. It may be worth the investment to focus on bringing those projects in early.

When business is down, managers often take a defensive approach and hunker down and wait for the storm to pass. Use this time as an opportunity to make your business more competitive. You’ll be healthier now and in a great position to respond when the economy picks up.

The post 8 Unconventional Things to do When Sales Goes Down appeared first on Projects in Less Time - Mark Woeppel.

Rocks Into Gold – A Parable

Mark Woeppel — Sat, 24 Jan 2009 17:02:49 +0000

A parable is a short story that conveys a profound truth. A friend of mine, Clarke Ching, wrote this compact business book that contains a GREAT idea. Spend 20 minutes reading it. You’ll be glad you did.

Rocks Into Gold – Helping Programmers THRIVE through the Credit Crunch – by Clarke Ching

View more presentations or upload your own. (tags: chain critical)

The story’s protaganist is a software developer that fears he may lose his job. His company is about to lose a major client and he comes up with a very simple idea to change his company’s offer, helping both his client and his company. I found it very thought provoking – it made me think about how my firm creates and presents an offering to a client.

The post Rocks Into Gold – A Parable appeared first on Projects in Less Time - Mark Woeppel.