Many people believe that to apply Value Stream Marketing using Lean Techniques is about removing waste. Eliminating waste is one of the Guiding Principles of Value Stream Marketing but you must make some fundamental improvements in your marketing cycle before a pull marketing system will work.
Value Stream Marketing (VSM) is about having a minimum amount of Work in Process (WIP). However, you cannot just wake up one morning and decide to do it. You cannot just remove marginal leads or work with only higher valued leads. It’s about a journey versus the decision to reduce your WIP. Managing your WIP will make you aware of many wasteful processes and as a result provide opportunity to remove them.
In VSM there are four critical components that you must understand: Protect Sales, Reduce your WIP, Improve your Cycle Time and Remove waste.
Protect Sales
Most of the time when an organization seeks to improve their marketing the central message is creating more prospects or more WIP. Seldom does that work. Filling the pipeline creates more WIP which creates more work and reduces your effectiveness and productivity. You end up with the wrong people doing the wrong thing at the wrong time. This is the essence of overproduction.
The first step is to distinguish how your sales, prospects are entering the pipeline. That should be fairly easy to distinguish. However, it may result in a very long list. Try to get a handle on this and group them according to your existing marketing channels. Take an empirical view of this.
The next step is where most of the problems occur. Once someone is in a pipeline all kinds of things happen and it’s hard to be certain what took place that enabled them to come out the other end as a customer. This second step will ask us to start trying to understand our marketing cycle and put it in a meaningful value stream. You may only understand a portion or a percentage of it; the rest may be so unpredictable that you cannot even venture to guess. Listing the process steps of your marketing stream will allow you to start noticing conversion rates, constraints and variation.
However, to start managing sales you have to start measuring it in a meaningful manner. The third step is measurement. If you cannot measure something the old story is don’t do it. In the sales and marketing process at this point we are not asking you to change anything just list it so that we can start observing and try to apply measurements to it.
Many times you will be able to identify a small percentage of prospects/channels that contributes to the majority of your sales. This is the value stream that you should concentrate your efforts and improve upon. It typically is the best known and easiest to identify (wonder why?).
This is the 1st of a 4 part series.
Related Posts:
The Guiding Principles of Value Stream Marketing
Value Stream Mapping Workshop
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