I came across a good article talking about eMetrics  via Smart Insights always a good source on real e-stuff rather than hype. Apparently there’s a whole event for it.

Talking of hype, it has a Gartner graph on hype over ‘big data’ technologies – quite an interesting list.

The article is written by someone I don’t know but when you’ve read it you can see my comment at the bottom, or just read on here. It’s a discussion about sales and marketing metrics.

“Good article Jim. Likewise I was hardwired with sales bonus schemes in my formative years, which is probably why running a business doesn’t scare me: I now have control of all the metrics and all the levers, not just sales target. It’s hard to get  a bonus scheme right so my belief is you focus everyone on the bottom line and make sure everyone can see how they contribute.

I’ve used an infographic called a “leaky bucket” which is really it’s a “leaky pipe”. It measures “lost revenues in £$€” and who lost them at which stage of conversion from aware of our business, through research, interest, shop, buy, activate, buy again.

But you have to ‘game’ it – the objective isn’t to max your piece of the pipe, its to work together to max the flow through the pipe. People take a while to get this.

The clever bit is three-fold:

1) Reverse the metric – what you didn’t win in £$€ is a bigger and stimulates more action with an instant business case against doing nothing differently.

2) Make the data available, don’t measure people on “their” bit of the pipe. Everyone sees their contribution and eventually works out they can contribute more widely than at their bit of the pipe.

3) You don’t need to bonus the results. People aren’t motivated extrinsically by money. Even hardened sales people have intrinsic motivators in reality – the winning, the recognition that goes with winning, enjoying their work and being proud of their professionalism ( not just being a “sales rep”)  they do, being part of a team. Their ideas being listened to.

So much time & money is wasted on measuring and chasing bonus schemes. It really isn’t the most productive answer in my experience.

PS this psychology can be applied to service environments too with the same power – I can talk about that another time. “

Of course the last part refers to the psychology of Skyline in “Best Service Is No Service“.  It drives by costs incurred by other parts of the business and showing the cost of doing nothing.

I’m really pleased that a business where I non-exec has adopted the leaky bucket with gusto and now has live data shared to everyone about the successes and leakages along the pipe. It’s starting to go beyond galvanising thinking. Sliderobes’ marketing director won the CIM  Senior Marketing Professional of the Year.

To finish and given assumptions in the original article about bonuses, it’s time to pull out the Daniel Pink Drive animation again. If you haven’t seen it, go with it right the way through. Autonomy, mastery and purpose – not bonuses!  And you can read more of teh origaonl Herzberg work on motivatoing and demotivating factors – the original HBR article is in my twitter stream yesterday.

Daniel Pink on Purpose, Autonomy, Mastery

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