Stop Reacting To Every Lost Deal, Every Complaint, Every issue - Start Improving.

Think of the days when we were all driving to the office. Yesterday it took you 22 minutes to get to the office and today it took you 28 minutes. You wouldn’t react as that is out of your control as you probably just caught an extra red light or two.

Yet, next week when you are driving it takes 43 minutes and you notice construction starting on your normal route. You either are ok with the new time it takes or you have to find a different way to the office.

Your sales data will be similar. Some variation could be normal, some could signify something bigger.

Knowing the difference between normal variation, common cause, and a special case that you need to act upon (special case) is key to driving improvement.

1. Some Changes Are Normal, Some Are a Real Problem

Sales numbers always go up and down. But not all changes mean something is broken.

• Common Cause Variation (NORMAL variation)→ This is the normal ups and downs that happen all the time. These changes don’t have one clear reason as they’re just part of how things work.

  Example: Some weeks more people buy, some weeks fewer people buy. That doesn’t mean your sales process is broken this is normal variation.

• Special Cause Variation → This is when something unusual happens that does have a clear reason. It’s not part of the usual pattern.

  Example: If a new competitor shows up and suddenly your customers stop buying, that’s not normal. That’s a special cause, and you need to do something about it.

If you react to every little up and down, you will be trying to fix common cause variation with special cause solutions. If you don’t recognize a special cause variation fast enough and it could put you behind your competition.

Building a system, a view is necessary for you to make good forward facing decisions.

2. Fix the Right Problem

If you change the routes you take to work because of catching two lights, you will often find a slower path and be late more often.

Unfortunately that is what most do in sales! They often react to common cause with point solutions to eliminate the event instead of treating common cause by looking at the system.

Examples of this: New sales decks created after losing one deal, firing sales people after one bad quarter, or changing their marketing messages due to one bad week.

Meanwhile when they need to act they are often too late.

Losing a significant amount of deals to one competitor over the course of a month. If we notice this too late this competitor can build momentum and capture market share before we even start to react.

In other words, there are two types of mistakes that comes from not understanding your data and if it is a common cause issue or a special case issue.

The error of action - We act on a point solution to a problem when we shouldn’t.
The error of inaction - We don’t act on a special case solution when we should.

If your data is not presented to you in a simple way for you to identify the difference, you are likely to be a victim to one of these errors. The question is how much will you pay for this mistake.