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How Total Quality Management Improves Sales

    Since its inception the quality movement in corporate America has focused attention on improving internal company operations, leaving front-line salespeople predominantly out of the loop. But the tides are shifting. As companies find they can make only incremental additional improvements in operations, executives are aiming the quality gun at customer relationships and building sales. This is where the quality conscious sales rep shines.

    According to Roger Howe, co-author of Quality On Trial (West Publishing Company, St. Paul, Minnesota) and founding member of Quality Institute International, many American companies have run into something of a quality “brick wall” and have had to seek new avenues for internal improvements.

    “Over the past couple of decades the quality focus in much of American industry has been on internal processes and how to make an internal organization more efficient,” he says. “And in the last ten years companies made enormous progress in that area. However, there’s only so much that they can get out of wringing the organization any further.

    “They really need to focus on the other side of the equation; that is, to ask, ‘How do we add revenue and market share? How do we develop new niches and products for new and current customers?’ In fact, a senior executive at Motorola told me that there was only so much they could do on the product and service quality side of the business. Although he said that Motorola would continue to make incremental quality improvements in operations, the key to future success would lie in leveraging the customer relationship side of the business to improve market share and get into new business with existing customers.”

    So what will this trend mean for salespeople and sales managers? Howe feels that when done correctly, the “quality review process,” as he calls it, utilizes salespeople and their intimate customer knowledge to forge bridges between customers and internal operations to provide better customer solutions. Unfortunately, he says, many companies have tried to circumvent their salespeople rather than include them in this process.

    “The salespeople have the greatest direct contact with the customer,” Howe explains, “yet some companies leave them out by using third parties to survey the salespeople’s customers. And that often creates a real problem for the sales and marketing organization because they feel as if somebody else is checking up on their work. In contrast, the quality review process puts the sales and marketing organization in the driver’s seat with respect to customer relationships to identify critical customer components, or what we call quality indicators.”

    To identify such quality indicators, salespeople interview their customers regularly, whether quarterly or semi-annually, to gather feedback on the company’s performance. The questions, Howe explains, fall into three basic categories.

    “First,” he says, “there are the product questions, which cover the reliability and specifications of the product. Second are the service category questions, such as, do we handle your complaints effectively, do we deliver on time, and so on. Third, and this is the departure from the norm, come the relationship questions, which ask in effect, what kind of relationship do we have with you as a supplier? These questions relate to the trust that exists between the two organizations. Do we deliver on our promises? Do we stand behind our warranties? How confident do you feel doing business with us?

    “I also recommend measuring the relationship’s inertia. Is the relationship moving forward or backward? Are we improving, declining or staying the same? Specifically, what do we need to do to improve? With this approach the interviewing process can become very personal, which we believe is a positive result.”

    Notably, Howe points out, this process merely crystallizes and coordinates, from above, a customer approach that many top performers already use on their own.

    “We have studied the behavioral characteristics of elite sales performers and we have found that either intuitively or as part of their sales strategy elite performers tend to do all of these things without any impetus from their managers. With that in mind, we have basically taken what elite performers do and systematized it to train the rest of the sales force, be they the direct sales force or in some cases the indirect sales force to mimic the elite performers.”

    Although this customer service-oriented quality review process specifically requires greater buy-in from the sales department, Howe emphasizes that if a company hopes to deliver customer solutions, internal operations must also participate in the process.

    “The key to this process,” he explains, “is that the customer is a customer of the company, not just of the individual salesperson. That’s why we encourage other people from the company to accompany the sales representative on the quality review interview with the customer. We recommend they go in twos, so that may mean that the salesperson brings along someone from MIS, production or customer service. This way one person can orchestrate the interview while the other acts as more of an observer, keeping the process honest.”

    As simple as it sounds, bringing diverse internal departments together for a common quality initiative may easily backfire, causing more harm than good. To maximize the quality effort’s success potential, Howe recommends bringing all the integral departments together from the start and then following a three-step process.

    “First,” he says, “you hold a design session whereby you bring various members of the organization – a cross-section of departments – together to determine what you’re going to ask the customer. You may even want to bring selected customers and suppliers into that session as well. The issue they’re addressing in this design session is: ‘What are the critical quality indicators that make our customers’ businesses a success and how can we measure those indicators on a regular basis?’ So, for example, to some customers on-time delivery is an important issue but it’s not a critical issue. But then other customers may live and die by on-time delivery.

    “The second step is a training session which brings the sales and marketing people together in the same room with the MIS people, the production people, etc., to teach them how to conduct the interviews. They also learn how to gather information without being defensive and what to do after the interview is over.

    “Finally, the third step brings all those people together to collectively plan actions around the customer. So it’s not just left to the production people or the salespeople to solve the customer’s problem, the whole organization gets behind the effort. And this way all the members of the company’s organization will be performing their specific tasks, but everyone will also be focused on the same goal – targeting that customer’s quality indicators.”

    Although the intended purpose of the quality review process is to focus every company effort on customer solutions for better relationships, Howe believes that other side benefits accrue to a company that walks the quality walk.

    “Building customer relationships,” he says, “translates into additional revenues from existing accounts, revenues from new sources and even revenues from lost customers who come back. I’ve seen it happen many times where a company that uses this process will retrieve lost customers. Up-selling and cross-selling are two other direct bottom-line impact results of this process.

    “The reason is that when you go to a customer and ask these product, service and relationship-targeted questions, that will often spawn a discussion about additional services a company has to offer. That happens over and over again in this process. So, unless increased revenue and market share are not important to your company’s future, the quality review process can make a very significant difference in helping create greater customer relationship-driven success and bottom-line sales.”