- Understanding the net performance of the Demand Waterfall is critical
- While individual conversion metrics are interesting, it’s ultimately the net throughput that’s important
- Demand Waterfall processes are linked; the output of one (e.g. automation qualification) becomes the input to the next
Are you suffering from TQL Neglect?
Years ago, when I started a new job as a VP of marketing, my new company provided me with Myers-Briggs Type Indicator personality profiles for my entire team. The profiles identify personality patterns based on four key attributes. With two options for each attributes, all people on Earth can be characterized as one of 16 different personality types. To make the information even more helpful for me in my new marketing role, my team’s profiles were accompanied by a “management playbook” for each personality type, giving me specific suggestions on how to best interact with each employee to drive the most engagement and productivity. It was a great way to quickly integrate with a new team.
So, what do Myers-Briggs personality tests have to do with the SiriusDecisions Demand Waterfall®?
I’ve talked to a number of SiriusDecisions clients about their waterfalls, and in these conversations, I’ve heard about several common waterfall performance issues. The numbers were always different, but the issues were similar. I’m a Myers-Briggs INTP, and one of the characteristics of my personality type is that I like to analyze and find patterns in data.
True to form, I started to look for patterns in Demand Waterfall issues – lead definition issues at the top of the waterfall, targeting issues, problems with service-level agreements (SLAs) at key handoff points. Ultimately, I found four main factors related to waterfall issues, with two options for each factor. The four-by-two structure immediately reminded me of Myers-Briggs personality tests.
Half-jokingly, I asked myself if Demand Waterfalls could have personalities. And if so, could I define a Waterfall Personality Test? And most importantly, once I understood a waterfall’s personality, could we create playbooks to identify and improve waterfall performance issues based on their personality pattern? The answer to all of these questions was yes!
Here’s a few interesting points about Demand Waterfall personalities:
? The predominant factor that impacts these personalities is conversion rates at key stages in the Demand Waterfall.
? The four key conversion rates map to key sub-processes in the aggregate lead management process measured by the Demand Waterfall. These sub-processes include automation qualification, teleprospecting qualification, sales qualification and sales close.
? To get a “personality rating” for a conversion point, organizations can compare their current performance against the benchmark – above average (A) or below average (B). Combine the four ratings to get a pattern, such as AABB.
? Understanding the net performance of the Demand Waterfall is critical. By multiplying the four key conversion rates, you’ll get a throughput rate. For example, a rate of 0.89 percent means that for every 1,000 inquiries fed into the top of the Demand Waterfall, 8.9 deals are created at the back end. So while individual conversion metrics are interesting, it’s ultimately the net throughput that’s important.
? Demand Waterfall processes are very closely linked; the output of one process (such as automation qualification) becomes the input to the next process. So if performance at the automation qualification stage is significantly above benchmark, the following stages are often below benchmark. If teleprospecting receives a high volume of unqualified leads, they will struggle to convert these to sales-ready leads at the expected conversion rates. In that case, you would see an “AB” in the first two stages of the pattern.
There’s one major difference between waterfall personalities and people’s personalities. While people have the same basic personality pattern for life, Demand Waterfall personalities can change. The way to change them is by focusing very targeted process improvement initiatives (waterfall therapy!) to address conversion issues.
So if, for example, your Demand Waterfall is suffering from a severe case of teleprospecting qualified lead neglect, you can often fix this “personality flaw” by collaborating to better define lead definitions and implementing SLAs among marketing, teleprospecting and sales.
SiriusDecisions has developed a diagnostics methodology based on Demand Waterfall patterns. It includes tools to help identify your Demand Waterfall pattern, a set of hypotheses for each pattern based on the likely process issues, and additional data collection worksheets used to prove or disprove the hypothesis. Once the issue is fully identified, our analysts work with our clients to fix the problem, leveraging playbooks, our published research and targeted analyst inquiries.
The first step in the process is to identify your Demand Waterfall pattern. You can get an initial assessment by completing the preliminary waterfall pattern registration form here. You’ll receive a customized one-page analysis of your preliminary Demand Waterfall pattern, along with insight on possible issues. Your Demand Waterfall pattern is a great starting point in discussions with our analysts about how we can help you improve your sales and marketing performance.