Blog: Change Management

Engineers have been employing SixSigma methods for years to find the root causes of their problems and increase efficiency in production, quality control, and development. Could the same tools be applied in marketing and sales?

In my last blog Desperate Times, Desperate Measures, I argued that despite the conventional wisdom in B2B organizations, marketing activities or sales initiatives are not isolated events that are part of a to-do list. They are rather interdependent moving parts of a bigger picture contributing to achieving a common goal. Even though very few people would argue with this statement in theory, in practice and from what I have been exposed to, organizational upcoming fiscal marketing budgets follow the golden rule of “last year’s- spending-plus-whatever-more-we-can-get”. Furthermore, I argued that once an organization reaches a certain maturity level, they start defining and viewing marketing or sales-related tasks as process steps while relying on data to make decisions around a marketing investment (or sales initiatives) instead of relying on existing habits or we-have-always-done-it-that-way-arguments. Having a process in place, provides the luxury of being able to measure what goes in (investment) and what comes out (return). It also serves as an enabler to achieve better results by examining the efficiency of each process step and finding the root cause of a potential problem. This is where SixSigma comes in and could play an impartial and valuable role. SixSigma tools and methods have been employed for decades in thousands of organizations around the world by engineers starting in manufacturing, production, quality control, hardware and software development. It then extended its reach to IT, finance, even in the banking sector to do exactly what is described above: analyzing processes; finding out root-cause(s) of problem(s); minimizing defects and by doing so increasing the efficiency based on collected data, not opinions. Borrowing from already-proven methods and statistical tools from SixSigma and applying them in sales or marketing could make a tremendous difference just as is has in other fields. So why don’t CMO’s or marketing managers in B2B embrace the concept or why don’t marketing departments in universities and colleges include such methodology in their curriculum? Well I think a simple answer to that question would be the fear of coming out of your comfort zone and going against the flow. In other words resentment to Change; not knowing how to Change; not knowing how to manage the Change. 

In practice and from what I have been exposed to, organizational upcoming fiscal marketing budgets follow the golden rule of “last year’s-spending-plus-whatever-more-we-can-get

So what if this resentment could be turned off, even for a few hours or you could hand pick a group of people with no bias or preference or links to the past. Well, this is exactly what happened a few weeks ago where I hosted a half-a-day workshop at the annual European SixSigma Club conference in Germany. The title of the workshop was “Applying SixSigma Methods and Tools in Marketing and Sales: A Silly Idea!”. Needless to say, the objective of the workshop was to prove exactly the opposite of what the title said. The participants consisted of experienced process engineers, development engineers, marketing professionals, business managers, senior R&D and product managers. They had all been exposed to SixSigma and knew how to apply the tools and methods in their field (except for the marketing person). They were also willing to open up and comprehend issues not directly related to their domain of expertise (eg. quotation hit rate, product sales forecast, e-mail campaigns, targeted or regional advertising, customer visits, etc.). I spent some time to provide an overview of these subjects that are honestly not rocket science. For example, on average, the sales organization provides over 200 quotations per month while the average incoming orders are 20 and therefore the quotation hit rate would be 10%. The goal would be to increase the hit rate. While a sales manager could give great motivational speeches as to why closing a sale is so important, push the sales reps, make sure on all sort of follow-up activities, SixSigma’s approach would be to clearly define the business problem in statistics terms; describe the process steps; find the root-cause(s) of break-down(s) in the process; determine the probability of reaching the goal by changing a process step or steps before actually having done so (in other words, provide a statistical solution to the problem); and lastly translate the statistical solution into business terms. This is the so-called DMAIC process.  

I tend to think of defining a clear process behind every marketing or sales activity is similar to having higher chances of shooting in the dark and actually hitting your target

During this workshop, three small groups worked on three different sales/marketing subjects: 1. Quotation hit rate, 2. E-mail campaigns, 3. Magazine Advertising. For the sake of time, some assumptions and some sample data had to be made-up and the objective of each group was to improve the status quo by following the above mentioned DMAIC process. It was absolutely amazing to see the results of what could be achieved and how decision-making in marketing and sales could become fact-based instead of guess-based provided the stakeholders are open to new ideas, not afraid to step out of their comfort zone, and give learning a chance.Although some might argue that SixSigma is a thing of the past and in order to survive, the organizations need to invest in new fields such as big data, blockchain, digitalization, data lakes and IoT, I would argue that the lowest common denominator among all these new fields is DATA and that is what SixSigma has been preaching all along. The importance and relevance of data in the decision-making process is the core concept behind SixSigma and it has been around for over three decades. I tend to think of defining a clear process behind every marketing or sales activity similar to having higher chances of shooting in the dark and actually hitting your target.

by: Ali Hoorsun, April 2018