By Pat Hinds
I had lunch with a friend of mine last week and we were discussing the start-up company where my friend was currently working and I had previously. When I was working with this company, I promoted a model for developing a sales plan that was based on setting a sales goal, developing a sales strategy, and implementing sales tactics. I have given a brief overview of each term below:
Goal Setting: establishing specific, measurable and time-targeted objectives.
Strategy or institutional management: is the conduct of drafting, implementing and evaluating cross-functional decisions that will enable an organization to achieve its long-term objectives.
Tactics: Means by which a strategy is carried out; planned and ad hoc activities meant to deal with the demands of the moment, and to move from one milestone to other in pursuit of the overall goal(s).
Our discussion focused around the topic of how often goals, strategies, or tactics should be adjusted during execution. My position on the topic was related to two blogs that I wrote earlier this year; the first blog entitled, Perception, Reality, Action, was about the role reference points play in perception and how it impacts our decision making. The second blog, What Now, Wall-E? Time to Start Selling!, is about Igor Ansoff’s Product Market Matrix. The point I was trying to make to my friend is the more difficult the task, such as the Product Market Matrix “Diversification” stage of launching a new product into a new market, the less points of reference a company has for establishing goals, strategies, and tactics. This often means that the reference points/experience is captured during the execution of the plan; resulting in the plan having to be flexible to accommodate the new information.
If a company is in a position of “Market Penetration,” selling existing products to existing customers requires more reference points in allowing the plan to be more structured and not requiring as many changes during execution. The exception to this would be the introduction of an event like the credit crisis which lead to the current severe economic downturn. In this environment, the situation of your target customer changed so quickly and dramatically that it would result in a major change to a company’s sales plan. When developing a sales plan it is important that companies use a structure that is well defined and measurable, but realistic in time-frame based on the difficulty of the plan.
Topics: Sales Consulting