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Five whys is a technique for unmasking the true cause of a problem. Originally
developed by Sakichi Toyoda (1867-1930), the inventor who founded Toyota
Industries, the technique is now incorporated into lean manufacturing,
continuous improvement (kaizen) and Six Sigma methodologies. Instead of
simply describing a problem and its immediate cause, an engineer or analyst
using this technique keeps asking why about each cause until the original
source of the problem is identied.
While choosing the right metrics to report on sales pipeline, productivity and
performance is important (see the brief The SiriusDecisions Sales Metrics
Framework), these metrics naturally trigger questions about why results are
what they are, or why a metric is trending in a particular direction. Sales
analytics extends beyond historical reporting to generate insights about causal
relationships. In this brief, we dene the types of analysis that sales operations
can provide for three key sales roles sales leaders, rst-line managers and
sales reps to complement their judgment and experience and enable more
eective, fact-based decisions.
Sales Leaders
This category includes the CSO and second-line managers such as regional
directors and vice presidents tasked with the development and execution
of the strategic sales plan. Sales operations can provide analysis and insight
to support critical leadership decisions such as market coverage and sales
resource optimization, and the prioritization of initiatives for improving sales
processes and productivity.
Sales resource optimization. Sales resource optimization is the process of
sizing and structuring the sales organization and allocating the available
resources across products, geographies and customers. This process requires
a combination of analysis, modeling and feedback from sales leadership and
management. The sales resource optimization process begins with an
assessment of the total addressable market (TAM), which includes existing
customer accounts and revenue as well as the realistic potential market that
can be served once competitive issues and distribution limits are considered.
Product-level requirements for each market should be integrated into a
portfolio-wide view to enable resource optimization at the company level.
Once country-level sales resource decisions are made, the same account data
and analysis are applied to resources at the regional, territory or vertical
market levels to drive territory design, account targeting and goal setting.
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Research Brief
Forecast process. By uncovering the root causes of
inaccuracies, forecast process analysis can generate
recommendations for process improvement. The analyst
must develop a deep understanding of sales cycle times, the
movement of opportunities through sales stages, win/loss
rates and the characteristics of won vs. lost opportunities.
This analysis should validate or identify critical inection
points in the customer buying cycle that can be used to
dene a common sales process based on observable
outcomes at each stage. Process analysis can identify causes
of inaccuracy such as management adjustments; it can also
identify and document forecasting best practices that
should be replicated across the sales force.
Sales Reps
Research Brief
and average deal size. Win/loss analysis can identify customer behaviors,
triggers and inection points that indicate a higher probability to close or,
conversely, situations where the rep should disengage from an lowprobability deal.
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SiriusDecisions is the leading global B2B research and advisory rm. We deliver the actionable intelligence,
transformative frameworks and expert guidance that equip executives to modernize and elevate sales, marketing
and product performance. SiriusDecisions is based in Wilton, CT with oces in London, Montreal, San Francisco and
Waltham, MA.