{"id":9426,"date":"2014-11-04T10:56:57","date_gmt":"2014-11-04T15:56:57","guid":{"rendered":"http:\/\/www.enxmag.com\/twii\/?p=9426"},"modified":"2014-11-04T10:56:57","modified_gmt":"2014-11-04T15:56:57","slug":"baseball-and-copier-sales","status":"publish","type":"post","link":"https:\/\/www.enxmag.com\/twii\/enx-features\/2014\/11\/baseball-and-copier-sales\/","title":{"rendered":"Baseball and Copier Sales"},"content":{"rendered":"

\"baseball<\/a>One of the beautiful things about the game of baseball is the fact that stats are kept on everything.\u00a0 Think about it, how often has the casual fan heard an announcer in the World Series say, \u201cHe leads the American League in two out RBIs after the seventh inning in games since the All-Star break.\u201d<\/p>\n

Have a question about baseball, there\u2019s a stat for that.\u00a0 This wealth of information has led many to question the value of traditional statistics like wins and losses for pitchers, or even ERA.\u00a0 Similarly, in this business we keep track of all types of statistics:\u00a0 Percent to quota and productivity per rep come immediately to mind.\u00a0 But do we really focus on the correct performance statistics in our business?<\/p>\n

Our fascination with statistics\u00a0<\/strong><\/p>\n

While baseball is in its purest form a game, it really is a business.\u00a0 Both teams and players use statistics to measure players\u2019 worth.\u00a0\u00a0A player\u2019s worth equates to the value of a contract they can negotiate.\u00a0 To ownership, the calculations are a bit more complex in that they see statistics as a tool to determine which players can deliver the best performance balanced against the amount of payroll they have to expend to get that player.\u00a0 For those who have not read the book or seen the movie, Moneyball goes into good detail on how teams use a stat called WAR (Wins Above Replacement) to establish one statistic for player value.<\/p>\n

What does all this have to do with copiers? Well, just like a Major League Baseball (MLB) team, a dealership has a certain amount of payroll to expend.\u00a0 And just like an MLB team, if you are using the same old stats to gauge performance you are probably getting it wrong.<\/p>\n

What is the matter with the old stats?\u00a0<\/strong><\/p>\n

The simple stats commonly used fail miserably to account for the general lack of uniformity in the sport.\u00a0 In short, not all ERAs are created equal.\u00a0 While the dimensions of the infield and pitcher\u2019s mound are consistent, all other dimensions of the game are not.\u00a0 \u201cBallpark Factors\u201d such as outfield fence depth, foul territory, prevailing winds, altitude and humidity, among many other things, play a role in inflating or deflating the stats depending on where the individual plays the majority of his games.<\/p>\n

In our business you can equate ballpark factors with a rep\u2019s territory; not all are created equal, but the territory has a significant effect in determining success or failure.\u00a0If you are determining your rep\u2019s value solely on performance vs. plan, you may be missing the boat.\u00a0 What you should be focused on is what the rep\u2019s performance is compared to the opportunity they have been assigned.<\/p>\n

The Trouble with Percent to Quota<\/strong><\/p>\n

Much of the industry has grown comfortable with equating the value of a rep to their achievement of quota, i.e., the 125% Club, etc.\u00a0But how was that quota established?\u00a0 Quotas should be established in a manner that allows for a true evaluation of performance.\u00a0 For example, rep one sells $1 million on a quota of\u00a0$900K (111% of plan).\u00a0Rep two sells $300K against a quota of $500K (60% of quota).\u00a0 Which rep is more valuable?\u00a0The correct answer is that it is hard to say.<\/p>\n

You may think that you should fire the rep at 60%.\u00a0But would you change your answer if I told you that rep two only had upgrade potential in her territory of $150K? That would mean that the rep covered the opportunity from the current customers and then sold $150K to new accounts.\u00a0 This rep grew the territory and some would have considered firing her.\u00a0 Let\u2019s look at the first rep that sold $1 million.\u00a0What if I told you that rep had upgrade opportunity of $1.5 million in his territory?\u00a0 We just sent him on the President\u2019s Club trip and he lost a half a million in current account business and sold nothing to new accounts.\u00a0 Which rep has the higher value to the company now?<\/p>\n

It is impossible to judge the performance of one rep against another based solely on percent of quota or even revenue because of the inconsistency in the potential of the territories.\u00a0 However, if you assign quotas based on the territory\u2019s potential and you use the same methodology for all reps across the enterprise, then percent to quota becomes relevant.\u00a0 Similarly MLB statisticians realize the inherent inconsistencies in ERA due to ballpark factors.\u00a0 As a result, they created a stat called ERA+, which takes these factors into account and gives comparability to the statistic.<\/p>\n

The Cost of Poor Decision-Making<\/strong><\/p>\n

In baseball, the teams that make poor personnel decisions are tied to long-term multi-million dollar contracts that can cost both production as well as the opportunity to sign better talent.\u00a0In the imaging world making poor personnel decisions carries a high cost too.\u00a0 Just think of the reps to whom you entrust your most important asset\u2014your customer base.\u00a0 If you cannot adequately gauge the value of the players on your team you may be overpaying underperformers while the good ones are getting away.\u00a0 You can measure the cost in lost customer base and a shrinking service annuity.<\/p>\n

Baseball has the equation figured out.\u00a0 Wins above replacement is an interesting stat that combines other statistics to put a numerical value on one question; if a player was lost to injury or trade, how many fewer games would the team win over the course of a year? More MLB clubs are making personnel decisions based on WAR. When player contracts are routinely counted in the hundreds of millions, poor decisions can cost clubs dearly. Have you determined what your WAR stat is for your business?<\/p>\n","protected":false},"excerpt":{"rendered":"

One of the beautiful things about the game of baseball is the fact that stats are kept on everything.\u00a0 Think about it, how often has the casual fan heard an announcer in the World Series say, \u201cHe leads the American League in two out RBIs after the seventh inning in games since the All-Star break.\u201d Have a question about baseball, there\u2019s a stat for that.\u00a0 This wealth of information has led many to question the value of traditional statistics like wins and losses for pitchers, or even ERA.\u00a0 Similarly, in this business we keep track of all types of statistics:\u00a0 Percent to quota and productivity per rep come immediately to mind.\u00a0 But do we really focus on the correct performance statistics in our business? Our fascination with statistics\u00a0 While baseball is in its purest form a game, it really is a business.\u00a0 Both teams and players use statistics to measure players\u2019 worth.\u00a0\u00a0A player\u2019s worth equates to the value of a contract they can negotiate.\u00a0 To ownership, the calculations are a bit more complex in that they see statistics as a tool to determine which players can deliver the best performance balanced against the amount of payroll they have to expend to get that player.\u00a0 For those who have not read the book or seen the movie, Moneyball goes into good detail on how teams use a stat called WAR (Wins Above Replacement) to establish one statistic for player value. What does all this have to do with copiers? Well, just like a Major League Baseball (MLB) team, a dealership has a certain amount of payroll to expend.\u00a0 And just like an MLB team, if you are using the same old stats to gauge performance you are probably getting it wrong. What is the matter with the old stats?\u00a0 The simple stats commonly used fail miserably to account for the general lack of uniformity in the sport.\u00a0 In short, not all ERAs are created equal.\u00a0 While the dimensions of the infield and pitcher\u2019s mound are consistent, all other dimensions of the game are not.\u00a0 \u201cBallpark Factors\u201d such as outfield fence depth, foul territory, prevailing winds, altitude and humidity, among many other things, play a role in inflating or deflating the stats depending on where the individual plays the majority of his games. In our business you can equate ballpark factors with a rep\u2019s territory; not all are created equal, but the territory has a significant effect in determining success or failure.\u00a0If you are determining your rep\u2019s value solely on performance vs. plan, you may be missing the boat.\u00a0 What you should be focused on is what the rep\u2019s performance is compared to the opportunity they have been assigned. The Trouble with Percent to Quota Much of the industry has grown comfortable with equating the value of a rep to their achievement of quota, i.e., the 125% Club, etc.\u00a0But how was that quota established?\u00a0 Quotas should be established in a manner that allows for a true evaluation of performance.\u00a0 For example, rep one sells $1 million on a quota of\u00a0$900K (111% of plan).\u00a0Rep two sells $300K against a quota of $500K (60% of quota).\u00a0 Which rep is more valuable?\u00a0The correct answer is that it is hard to say. You may think that you should fire the rep at 60%.\u00a0But would you change your answer if I told you that rep two only had upgrade potential in her territory of $150K? That would mean that the rep covered the opportunity from the current customers and then sold $150K to new accounts.\u00a0 This rep grew the territory and some would have considered firing her.\u00a0 Let\u2019s look at the first rep that sold $1 million.\u00a0What if I told you that rep had upgrade opportunity of $1.5 million in his territory?\u00a0 We just sent him on the President\u2019s Club trip and he lost a half a million in current account business and sold nothing to new accounts.\u00a0 Which rep has the higher value to the company now? It is impossible to judge the performance of one rep against another based solely on percent of quota or even revenue because of the inconsistency in the potential of the territories.\u00a0 However, if you assign quotas based on the territory\u2019s potential and you use the same methodology for all reps across the enterprise, then percent to quota becomes relevant.\u00a0 Similarly MLB statisticians realize the inherent inconsistencies in ERA due to ballpark factors.\u00a0 As a result, they created a stat called ERA+, which takes these factors into account and gives comparability to the statistic. The Cost of Poor Decision-Making In baseball, the teams that make poor personnel decisions are tied to long-term multi-million dollar contracts that can cost both production as well as the opportunity to sign better talent.\u00a0In the imaging world making poor personnel decisions carries a high cost too.\u00a0 Just think of the reps to whom you entrust your most important asset\u2014your customer base.\u00a0 If you cannot adequately gauge the value of the players on your team you may be overpaying underperformers while the good ones are getting away.\u00a0 You can measure the cost in lost customer base and a shrinking service annuity. Baseball has the equation figured out.\u00a0 Wins above replacement is an interesting stat that combines other statistics to put a numerical value on one question; if a player was lost to injury or trade, how many fewer games would the team win over the course of a year? More MLB clubs are making personnel decisions based on WAR. When player contracts are routinely counted in the hundreds of millions, poor decisions can cost clubs dearly. Have you determined what your WAR stat is for your business?<\/p>\n","protected":false},"author":31,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1649,1879],"tags":[],"_links":{"self":[{"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts\/9426"}],"collection":[{"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/users\/31"}],"replies":[{"embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/comments?post=9426"}],"version-history":[{"count":2,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts\/9426\/revisions"}],"predecessor-version":[{"id":9944,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts\/9426\/revisions\/9944"}],"wp:attachment":[{"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/media?parent=9426"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/categories?post=9426"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/tags?post=9426"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}