Dynamic, Service-Triage-Program: Case Study
August 2, 2016
Do you want to hire the best employees and keep them stoked? Here’s a successful distributor’s thinking:
1. Best employees (like thoroughbreds) cost more upfront. And, they want a career growth path.
2. But, raises and profits to reinvest into growth must both come from growing Gross Margin Dollars (GM$s) per Full-Time Equivalent Employee (FTEEs).
3. So, freeze headcount and trade low, unprofitable, GM$/service-hour, accounts for high GM$/hour accounts.
4. How? Give your 5 most profitable and 5 most potentially profitable accounts much better service.
1. Every employee memorizes ten biggest (potential) profit accounts.
2. Ideas are listed and play-acted for diplomatically giving “the Big Ten” line-cutting service at the inconvenience to unprofitable “minnow accounts”.
3. Service goals for the Big Ten: They will never be handed off to another employee with any delay or fumbles. They will get faster, perfect and more-creatively, thorough service.
4. Give everyone customer profitability information and trend reports for both GM$s/FTEE and Profit$s/FTEE. If Profit$s/FTEE clears a target, then gainsharing bonuses accrue for all.
All inside sales people are busy. #2 Target Account calls. The “overflow person” enthusiastically tells #2 to: “Wait just one second”. Then yells: “Can anyone Triage for #2?”
Tony is talking to “Micro-Plankton Man” (MPM). In mid-speech, he hits the blinking button to work with #2 for more than an hour. #2 needs some product specs, pricing and a shipping date – for a potential factory direct order. Tony walks the call over to purchasing. The team (using the speaker phone) calls the factory to get all needed information in record time.
#2 then quotes their customer and wins by being the first-back bid. Tony and associates then collaborate with #2’s folks to create a “Speed Quoting Wins” process.
#2 then wins more business with faster quoting. Their purchases grow from $30K to $500K with profits rising from 3 to 6% of sales. MPM’s sales, meanwhile, go from small at a loss to zero. He switches to a competitor when assigned to a new service model and terms that would have made him profitable.
The team needed MPM’s service activity and more to reinvest into #2’s booming activity without adding people. GM$/FTEE doubled; Profit$s/FTEE quintupled; and gainsharing bonuses and reinvested profits/FTEE happened.
Will you lose key accounts and gain more minnows? Or, get Waypoint Analytics first to hit competitors both high and low?
Bruce Merrifield, Merrifield Consulting
Partner, WayPoint Analytics
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