BIG data! Predictive Analytics! Machine Learning! Shout it from the mountain top, in the marketplace and from every bully pulpit, we shall mine the rich veins of data and the alchemists and wizards shall create algorithms that will set us free! Hallelujah, the shackles of the human mind, the abacus, slide-rules, calculators and spreadsheets shall no longer constrain our performance! And oh, the joy the high priests, pundits and gurus shall have pontificating and postulating on this glorious new age of milk and honey!
Really? For all of us commoners too? Let’s step back for a moment; as my bumper sticker says, “Think, It’s not illegal (yet!)”
Let me first say I am by no means advocating being a Larry Learning Luddite or a Debbie Data Downer. There is truly a revolution afoot, and the results for many enterprises are just starting to be realized. The fact is that these capabilities are no more of a “one size fits all” panacea than any other technology, methodology, framework or model. Working with growing businesses, early stage companies, and those in rapidly changing markets we hear daily of how agile and responsive they must be to survive. Pivoting, adapting, re-inventing and disrupting are the norm, and with this volatility come the challenges of maintaining data integrity and hygiene to support more nuanced decision making. The question facing leaders in these organizations is how can we grow into these predictive capabilities, and what can we do today to lay a sound foundation for the future?
Working with a smaller, messier set of data during early stages of growth requires the team to define the focused metrics that really drive their unique business model. Some are obvious: Are we hitting bookings and revenue goals? Are we adding new customers at the pace we planned? Where and why are we winning, and where are we stuck or losing too many deals? Some might be less so: Is our deal velocity higher in certain segments? Where are we selling at higher margins? Are there differences in our own execution (sales team tenure, experience, training, more mature solutions) that impact our outcomes?
Even with only a handful of sellers and a relatively small number of opportunities in the funnel we need to be identifying and addressing the root cause of our performance challenges, and therein lies the rub. CRM data hygiene is notoriously bad for the vast majority of early stage companies. Many use generic sales stages with no correlation to a buyer’s journey, and most lack any rigorous discipline to enforce the needed updates for critical data points in the systems. We worked with one client who reported a pipeline value (open opportunities) of $53M, only to discover after a forced triage that over $15M were unqualified deals that had not been touched in over 60 days. We of course used simple analytics to identify this issue, but until the data was cleaned up and a well enforced governance process rolled out it was not possible to dig deeper into win/loss trends and identify where to focus sales and marketing spending. In this case the organization recognized the need to do a massive reset. They reconfigured their CRM system, messaging, and training around vertical market solutions to replace a generic horizontal offering. With the correct data being gathered they were able to quickly see which markets were the most profitable and where they had competitive advantage. As the company continues to grow they are now at a point where they can gain predictive insights from the expanded and (relatively) clean data and optimize their strategic investments. And yes, they can now see what the Deus ex Machina can learn and teach them.
Entrepreneurs, boards, and investors have been balancing the need to support investment decisions with sketchy, minimal data for decades. Starting with a small number of relevant KPI’s and ensuring the systems capture these metrics allows for real time A-B testing, pilot programs, agile sprints, and adapting to the lessons learned from the petri dish of real world selling. It also establishes a culture and discipline that recognizes the value of keeping the data refreshed and accurate to accelerate the time when those precocious, prescient avatars joining our weekly staff meetings can guide us mere mortals in our quest for the grail!