Productivity Gain Starts with Measuring the Real Process

October 11th, 2011 by

I was invited to the Energy Council of Canada honouring Suncor Energy Inc. top executive, Rick George, as Energy Person of the Year. I was sitting next to Sippy China a partner at Deloitte responsible for the energy services practice. Sippy made a comment at dinner that “productivity” will be the business buzz word in 2012.

“Productivity is a measure of the efficiency of production. Productivity is a ratio of what is produced to what is required to produce it. Productivity is a measure of output from a production process, per unit of input.” Wikipedia

Rick George, in his address to the audience while accepting his award, made reference that his primary job was to increase production while lowering the cost of production and Suncor is achieving this through the adoption of technology.

“Suncor is very much pursuing some leading-edge technological developments in its key activity, which is oilsands”

Sales and marketing is no exception; we need to gain productivity if we are to stay competitive and this will be achieved through the convergence of sales and marketing and the ability to understand the “Real Sales and Marketing” process and measuring output. A “Real Process” can be described as a process that generates the production output from input, and it can be described by means of the production function. It refers to a series of events in production in which production inputs of different quality and quantity are combined into products of different quality and quantity. Companies need to evaluate the “Real Sales and Marketing” process and how it generates the production output from input.

The traditional real sales process included the sales person owning a geographic sales territory, market research by knocking on doors, product marketing with brochures and catalogs, solution selling and order processing. Marketing was responsible for brand and product marketing. In this process you have two units of input measured by a unit of output; a sales order.

If a company wants to improve productivity they need to break down the “real sales and marketing process” and measure the units of input and output of each stage of the process. An example of the real sales and marketing process would be comparing the traditional demand generation model of sales person banging on doors to the new model of telesales target markets, Web Site Lead Capture, Market Events, White Papers, etc.

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