Quantcast
Subscribe now
Get The Machine sampler (first 4 chapters) free the instant you subscribe! You'll also receive each of my posts, fresh in your inbox. 
(You'll get The Machine sampler in your inbox the instant you subscribe!)
THE SMALL PRINT: We know you're taking a risk when you entrust us with your email address, so we commit: (a) to NEVER spam you; (b) to NEVER sell or rent your data to anyone; (c) to ALWAYS make it easy for you to unsubscribe; (d) to ONLY send you stuff you reasonably expect to receive; (e) to contact you LESS frequently than you would reasonably expect.

If you listen only to Kirk Nelson's first few words in the interview below, you'll be missing out on one hell of a treat!

Kirk starts the interview by assuring me that ARCA has an accurate sales funnel and a good understanding of what's going on in the business.

That's good, right? But, where's the money?

Well, listen up, because after Kirk's understated opening, all hell breaks loose!  The real fun starts when I ask Kirk if Sales Process Engineering has had any impact on sales.

Turns out there has been an impact. Kirk started his journey in July 1, 2012.  By the end of the year, revenue was up 37%.  And Kirk expects to finish this year (2013), with another 40-50% increase in revenue.  Over this period the volume of units shipped has increased ten times.

We're delivering ten-times the number of units per month than we were a year ago

And, it gets better!  To achieve this, Kirk reduced his sales team from five people down to two.  He also scrapped the commission and bonus plan and put the remaining salespeople on straight salary. And, in spite of the fact that he has a mandate to add more salespeople when his existing team hits 80% utilization, he hasn't had to because the team is still only averaging 60%.

Bottom line, then, is that Kirk's organization has just about doubled sales with two-fifths of its original sales team and with the remaining salespeople operating at half throttle! And, no, before you ask, Kirk's organization is not a start-up!

ARCA: cash-automation technology

Kirk Nelson is an Executive VP at ARCA. ARCA provides cash-automation machines to financial institutions, retailers or anyone else who wants to automate the receipt or dispensing of cash.  (If you've ever cashed-in a pile of chips in a casino, the odds are that you've interacted with ARCA's technology.)

ARCA is both a distributor and a manufacturer of its own technologies.  The organization has been in existence for 13 years and has operations on a number of continents.  You can find ARCA here.

Ballistix's involvement: virtually none!

ARCA is another example of an organization that has implemented SPE – and achieved stunning results – with vitually no direct assistance from Ballistix.  I ran a two-day (Solution Design) workshop for ARCA in June 2012 but, aside from that, Kirk has produced this outcome using only The Machine (my upcoming book) as his guide.  (I think he also read my first book and attended a webinar or two.)

This is awesome, for two reasons:

  1. If organizations can implement SPE without the assistance of Ballistix (and a rapidly increasing number are), this is a powerful validation of SPE
  2. It's just not cricket for for me to crow about the accomplishments of our own clients.  However, if an organization can achieve a breakthrough by themselves, that's something I feel a little more comfortable making noise about!

So much value

As is often the case, the real value in this interview is not the headline.  The truly valuable nuggets are the casual revelations that Kirk makes as he tells his story: 

  1. Like when Kirk jokes that he would not like to have to answer to one of his salespeople's sales coordinators ("they are brutal", he says!, when explaining how Sales Coordinators genuinely own opportunities – in spite of the fact that they earn less than half what salespeople do)
  2. Like when Kirk reveals that he now has an uncanny ability to forecast revenues (he's close to achieving a forecasting accuracy of ±10% accuracy at 90 days)
  3. Like when Kirk explains why salaried (rather than commissioned) salespeople are actually more effective
  4. Or when he talks about how Project Leaders have been able to effortlessly convert small transactions into (much larger) enterprise-wide opportunities (and reduce opportunity-lead-time into the bargain)
  5. Or when he describes how SPE has united the organization's leadership by giving the executive team a common set of metrics (specifically, by allowing the sales function to be evaluated using metrics that make sense to executives who have been schooled in Lean and Agile)

The constraint shifts

The highlight of this interview, for me, was one of those interstitial moments when Kirk happened to mention that Mort (ARCA's CEO) had recently declared that Sales is no longer the organization's constraint.  "The speed at which we can step on the gas", says Kirk, "… is simply astonishing".

Those viewers with an operations background will really appreciate the significance of this statement.  If ARCA (or pretty much any organization) can scale sales rapidly it enables that organization to keep the constraint in production – to keep operational infrastructure operating at full utilization at all times.  

This, ladies and gentlemen, is how real money is made!

 

Update (Oct 7, 2013): An article on ARCA's progress appears in News Observer, here.

Tagged with →  

Home Forums The incredible ARCA journey: two-fifths the sales team; twice the sales

This topic contains 10 replies, has 2 voices, and was last updated by  Justin Roff-Marsh 3 years, 11 months ago.

Viewing 10 posts - 1 through 10 (of 10 total)
  • Author
    Posts
  • #13794 Reply

    Shamal Tennakoon

    I was in the audience among a lot of other people about 15 years ago (long hair is gone), glad to see you continuing to direct companies to reach the next level in their journey.
    Interesting to see how you manage the mind shift change on Sales Rep dependency to process dependency; which is the better model for the longevity of the organisation. Must read your book.
    Have not heard from you for a long time, just today saw your email with the interview with ARCA, what an achievement for them and you; congratulations, will pass the email to a few associates. Keep me informed when you are next in Australia.
    Good luck and may you have enough in life.
    Shamal Tennakoon

    #13802 Reply

    Shamal

    Good to reconnect. And thank you for the good wishes. Maybe I’ll grow the long hair back one day!

    I’m back in Australia late July. Use the contact form to make contact if you’d like to schedule something.

    Justin

    #14382 Reply

    Josh

    Hi Justin,

    Thanks for sharing this video, appreciate the frankness of both Kirk and yourself.

    I was very impressed with Kirks obviousily very effectvie implementation. Particularly the project leader concept. Which I think we need to adopt.

    The main benefits would be:
    1. You can probably get them cheaper than sales people.
    2. They are probably much better technically than sales people.
    3. It is a good way for the sale people to permanently pass the on going relationship off.

    I was wondering how early, you believe the project manager should take over, and also your experience on sales people working alone vs. taking a project manager to meetings with them from an early stage.

    #14387 Reply

    Michael

    Justin,

    You know I’ve followed your work from almost the beginning. I find myself skeptical from anyone (even someone I know) who claims results at this high of a level. It seems as if every advisor / consultant / marketer is claiming massive results, but always have that little asterisk, and then results diminish.

    This is a fantastic story. It’s great to hear someone who actually did it. I never anticipated that I would listen to all ~30 minutes, but once you guys started talking about the results and specifically how you did it, I couldn’t pull myself away.

    I sound like a sales pitch for the video. Anyway, congrats, keep up the good work.
    Michael

    #14388 Reply

    Josh

    I answer your questions about the Project Leader role in some detail in Chapter 3 of The Machine. You can read it here.

    http://www.salesprocessengineering.net/2010/11/29/the_machine_pt1_ch3/

    You ONLY need a Project Leader if the opportunity is on the wrong side of the ‘complexity threshold’ — but if you do need a Project Leader, you MUST involve them early: they must engage at ‘requirement discovery’.

    Justin

    #14389 Reply

    Michael

    You’re right. These kind of benefits reek of ‘too good to be true’. In fact when we do create these kind of results for our clients I don’t talk about it: doesn’t seem right.

    However, in this case, Kirk did it himself!

    Glad the video hooked you in!

    Justin

    #14833 Reply

    Kirk Nelson

    Michael,

    I am glad that you found the video compelling! The Executive team here at ARCA is completely committed to implementing the processes described in The Machine. Without their support the implementation would have broken down. One year into it we have discovered so much about our work and our customers – we can serve more clients faster and with better results through the division of labor and the definition of standard work. The results are all real, drop a line sometime and I would be happy to discuss it.

    Kirk

    #21098 Reply

    Sean

    Justin, at 15:35, you ask Kirk how he drives (generates) the sales opportunities that are the seeds of this sales increase. That question is never really answered. At 16:30, Kirk comes close to answering by saying that the funnel is actually smaller now, but mainly because of a change in the definition of what qualifies as a viable opportunity. So my question is, did anything change from a lead/opportunity generation standpoint? Or in this case is it all about taking the same “funnel” and getting a higher conversion rate out of it?

    #21972 Reply

    Kirk Nelson

    This is a good question. I have a few basic beliefs around the funnel.

    1. Once a First Appointment is set and the prospect moves out of the Target phase there must always be a next action, agreed to by the prospect and bound by time.

    “We will meet at 2:00 PM on the 3rd of October to review our Proposal………..”

    The first cleansing of our funnel was to eliminate as “Closed – Lost” all opportunities where there was no next action bound by time with the customer’s agreement.

    They were not “playing ball” with us any more.

    The rigorous enforcement of this “playing ball” rule keeps the sales team focused on deals which are moving forward.

    2. Even if there were no inbound leads there is no benefit to moving prospects slowly through the funnel. Move them through as quickly as possible – even if that completely drains your funnel.

    2. Promotions, promotions, promotions. We have completely revamped our promotions team around the generation of QTY 30 inbound leads per week. With a full time promotions coordinator working closely with the sales coordinator, our marketing content team and the referral partners we are able to generate an adequate amount of inbound leads. However, our sales utilization rarely rises above 80%, so we can take many more inbound leads than we currently do.

    The size of the funnel is determined by the success of our promotions programs, not our sales programs.

    #22295 Reply

    Update: an article on ARCA’s journey appears in News Observer here:

    http://www.newsobserver.com/2013/10/05/3250730/revamped-sales-effort-pays-off.html

Viewing 10 posts - 1 through 10 (of 10 total)
Reply To: The incredible ARCA journey: two-fifths the sales team; twice the sales
Your information: