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Summary

8th Commandment

NOT ALL AUTOMATION BENEFITS ARE TANGIBLE.
LOOK FOR DEGREES OF TANGIBILITY.

In most cases, during initial project development, management will be tasked with demonstrating a tangible return on their investment in SFA software, hardware, training and support. There is a certain amount of shamanism attached to ROI analysis. Some of it is very straightforward while other portions of the analysis can take on an almost mystical importance. Tangible ROI should not be taken too literally. If you manage such a project to the penny, expecting to see $X in increased revenue or decreased expenses within a particular time frame, you are once again setting yourself up for false expectations and disappointment. More importantly, you will be putting your career and credibility at risk. Too often management puts the onus for achieving ROI on the development or implementation team. That’s misplaced responsibility. All the technical and operational people can do it build what is asked for and deploy it. It is up to sales management and their sales team to use it and achieve the proposed ROI.

This brings us to the undeniable importance of intangible benefits. In one of our studies, we realized we could save sales reps about a half hour per day by freeing them up from manual administrative tasks. When we revealed this fact, many people were unimpressed. That is until we extrapolated this time savings could produce up to 2-3 months of additional selling time per year. This extra time represents a huge amount of potential revenue. Now if the rep misuses this extra time and simply takes off early, comes in late, or takes long lunch/golf hours, then the benefit and ROI is moot. However, if management is aware of this intangible benefit, they can increase quota and hold reps’ feet to the fire.

There are other intangible benefits that include being able to push a sale through the process faster. This allows a company to deliver their product or service faster resulting in greater levels of customer satisfaction – intangible. If the customers are happier, they will stay longer and buy more products or services from you – a little more tangible. More importantly, by turning up a customer faster, you can bill them sooner for the product or service. This can generate huge cost savings and improve cash flow very quickly – very tangible!

The flip side of improving customer satisfaction is improving morale among the sales force. A happier rep usually stays longer thus lowering account churn, employee attrition, and retraining costs. The longer a rep has stayed with a company, the greater the chance for improved year over year performance. Tenure has a definitive, positive impact. 

So remember, tangible returns on investment are required, but there are degrees of tangibility. The ROI must look at the whole picture and not a portion of it.