In my Marketing Your Black Belt webinar, I have created several tools to measure your effectiveness and how to create a meaning full value stream in your marketing process. One of the resources that I used was an excellent book, Professional Services Marketing: How the Best Firms Build Premier Brands, Thriving Lead Generation Engines, and Cultures of Business Development Success. I highly recommend it. In the book they discuss measuring your success and they claim that Only Seven Levers Matter:
1. Number and/or quality of targets.
2. Number of overall leads.
3. Number of qualified leads.
4. Number of pipeline opportunities converted to clients.
5. Revenue per client.
6. Revenue retention.
7. Growth rate per client.
The authors, Mike Schultz and John Doerr say that if you are doing an activity that will not effect one of these levers, stop doing it!
I do not necessarily agree with the complete statement as I do believe a measurement of referrals, such as mentioned in The Ultimate Question: Driving Good Profits and True Growth, also needs to be considered. This book says the best way to gauge the efficiency of a company’s growth engine is to take the percentage of customers who are promoters (P) and subtract the percentage who are detractors (D). This equation is how we calculate a Net Promoter Score for a company: P – D = NPS.
Overall, I like the seven levers as I can see that it does provide a natural extension to measurement of a Marketing Funnel that is needed. It will highlight a specific area that is doing a great job or producing little results. The suggestion I would like to consider comes form my trouble shooting days on equipment. Seldom was the problem ever the last thing that happened. It was always a result of what happen several stages before. I can remember on the phone hearing the description of the problem and asking the customer: “What did you do right before that? Or before that?”
When problems occur it really is about finding the root cause. However, so many times the solutions are not readily apparent due to the lack of measurements. I think organization of your marketing process into a funnel, flow chart, process map or just a swim lane flow chart is a great way to start. After this step is completed, I recommend starting a Value Stream Map. Even though you will probably be unable to complete it, due to the lack of measurements you can start considering the measurements that will assist you. You may surprise yourself. If you only know three of the levers for example, it may be very simple to interpolate the remaining. After that, you can start monitoring and your numbers will start improving in accuracy.
If the authors are correct, you only need seven measurements in your process block? Pretty simple process. Wonder why we don’t do it? By the way, can you think of any other levers that might be needed?