Intel has given its sales management team the controls with dashboard software that not only monitors sales performance, but also recommends corrective action.
Even though the company's salespeople were using Siebel for opportunity management, sales managers had to rely on spreadsheets to compare actual sales to quota and forecast. Because data was pulled from both Siebel and the company's Oracle ERP system, the sales force was never convinced the spreadsheets reflected current status.
"It was always the spreadsheet of the minute," says Howard Woolf, Intel's president of sales for the Americas. "Which one do I look at, which one has the latest information. And then, of course, we would spend the first half-hour of every meeting debating the data."
The spreadsheets fell short in other crucial areas, as well, according to Woolf. "You couldn't put together everybody's quota and performance against the quota, their forecasts against the quota, and last forecast versus current forecast." Nor was there room for pipeline information.
As the largest computer chipmaker in the world, Santa Clara, Calif.-based Intel, pulled in revenue of $33.7 billion last year. Sales in the Americas accounted for 41 percent of that, making Woolf's staff of about 150 people responsible for hundreds of millions in sales. With those kinds of numbers at stake, it was imperative that he have up-to-the minute information to catch shortfalls before they became major issues.
Woolf considered customizing Siebel to provide the needed information, but decided against it. "With enough money and enough time you can do anything, but it's not naturally the place to do it," says Woolf. "Siebel is very good when all the information is in its database, but if you need to pull data together from a variety of sources and align it to be meaningful, it would be very hard to do."
He also considered building a system from the ground up, but dismissed that idea as well, finally deciding on the SalesRazor applications from Ockham Technologies, Atlanta. The web-based applications would replace the maze of spreadsheets by providing a real-time view of data from across the organization. The software sits on top of the company's Siebel and Oracle databases to pull in information on sales, orders, customers and pipeline. The result is the equivalent of a dashboard that monitors and measures defined metrics, including actual revenue versus quota, pipeline, cost of sale, commission and open sales territories to provide a constant profile of sales performance.
In addition, the application uses industry-specific best practices to guide sales managers through critical sales planning decisions such as quota setting and forecasting. "The difference here is we have very proactive decision-support tools that are constantly monitoring the business performance," says Rod Johnson, service director at AMR Research, Boston. "Like Epiphany has done in the marketing world by using advanced analytic tools to do a better job as a marketing manager, Ockham is trying to do the same things for the sales manager."
More than just presentation, the software provides the ability to take action, as well. "Ockham is identifying the key metrics and recommending corrective action you can make to a territory, incentive program, or campaigns to try to correct issues challenging the business before they show up at the end of the quarter and you've missed a number," says Johnson.
At the Controls
Intel rolled out two of the SalesRazor applications. SRMetrics was deployed last fall in about 90 days. However, Woolf says they began using pieces of it in the summer prior to implementation to train sales managers and get them behind the project. "The real issue isn't the tool, but the business process you want them to move to," says Woolf. "Every sales manager worth their weight has a back-of-the-envelope paper in the drawer that's their short list of deals they're going to close to make their numbers. Getting them to move that information into the company system and getting a disciplined process in place is what takes the time."
Today, more than 100 people use SRMetrics on a regular basis, including sales reps, who update their forecast every week. The system is fed every night with the latest business results, so it always reflects revenue over the past 24 hours and orders scheduled to go out. Sales reps and manager can see their status every day as to where they stand against quota, as well as their forecasting history. "We measure performance to plan, pipeline, actuals, and we measure the dynamics in all that," says Woolf.
Managers also use the system to analyze projected results and track results and that may lead to changes in territory and assignment. Woolf says they've also made decisions on performance and are using the system for resource planning.
In January, Intel installed Ockham's SR Quotas. The tool allows managers to set up criteria based on territory size, sales rep experience, account size, and other variables and parameters to analytically set quotas.
"Quota setting has always been the fine art of negotiation," says Woolf. "One thing I've learned in over 25 years in sales is that there's no black and white answer. The better you can walk through the quota setting process in a logical way, the faster you get through that part of setting up the year."
According to Woolf, the analytics behind the tool goes a long way toward helping people believe in the quota so they can go after it aggressively. "The better you can prepare them with some rationale for what supports the number, the better off you are in them believing it's an achievable goal," he says. "People actually work harder and do better when they believe they can achieve those goals."
In addition to setting yearly quotas, Intel uses the software on a weekly basis as assignments change or the group reorganizes to focus on the highest priorities. Oftentimes, a new salesperson's responsibility is made up of accounts previously serviced by several other reps. The system allows the company to keep that knowledge in its database, so managers can mix the information together to map the new assignment.
"The quota setting tool allows you to start out with here are what this assignment has historically done and was projected by the last people to be able to do," says Woolf. "Then it takes into account other factors like the seniority of the person now being assigned and allow you to come up with a data-driven conclusion of what the quota ought to be. If you're a sales rep, it gets you started faster because you have a higher confidence that you've got a reasonable shot at achieving the goal."
Paying for the Ride
Though Woolf wouldn't disclose what Intel paid for the system, SR Metrics license agreement and implementation costs typically range from $250,000 to $1 million. Even so, the company didn't do formal return on investment analysis.
"The expense wasn't enough to be that much of an issue," he says. "We just looked at how much time we were spending on spreadsheet management and the inaccuracies. We did trade off developing our own, and this wasn't that tough of an expense to justify."
Besides, Woolf says it would be impossible to write a return-on-investment formula for this type of system. For the quota tool, he thinks payback will come from more highly motivated salespeople and the speed by which they can launch a new assignment. For SRMetrics, it will come from having information to make the right decisions. "What I have seen is an improvement in accuracy of knowing where we are," says Woolf. "Not only do we react quicker, but we plan better."
Though the company has only used the system for a short time, Woolf says it's already eliminated a lot of work they were doing on spreadsheets. Long term, he expects to achieve a better-disciplined selling process, which means more efficiency, higher revenue per person and smarter application of resources. "It's never the tool," he says. "It's really how you use the information that the tool gives you."