Of course, a sales objective can’t be defined like this, but let’s imagine it can, what would soon happen? Fictitious sales being recorded? Sales between subsidiaries rising? Friendly customers placing orders in one accounting period cancel them the next?
Besides the operational processes in place to control this kind of situation — that usually results in sales dropping, often lower to levels below the starting point through reputation damage — it’s important to understand, not just the role of data in this process, but the role of data governance and governed data.
What is the definition of a sale?
A sale can be defined as a transaction between two or more parties in which the buyer receives tangible or intangible goods, services, or assets in exchange for a payment.
When considering the context of an organization and getting into the detail the definition is likely to be more complex, specially when it comes to data.
What data is involved in a sale?
Before jumping into data, we must remember that all this data items or assets to be mentioned are first of all business concepts.
A business concept is a statement that describes the scope and purpose of existence of all the crucial elements that define the business and how it operates.
According to this definition a business concept must be clearly and consistently understood across any organization.
The first question is: Are all the business concepts uniform across your organization?
For instance, is the concept of customer clear across finance, administration, HR, marketing, and other departments?
The second question is how are those concepts transposed into data?
For most organizations different areas store and manage data assets in separate locations and systems (Usually known as data silos).
Although a product of the normal growth of any organization, this creates barriers to information sharing and collaboration across areas, it creates inconsistencies, with a serious impact on the quality of data quality and impairing leaders to get a holistic view of the organization’s data.
This is a simplified vision of the most common scenarios, but it is possible how it can affect the simple process of defining and controlling sales objectives.
What business concepts are we considering?
A few examples of business concepts that are involved when managing sales: Customer, contacts, leads, opportunities, sales collaterals, requests for proposals, proposals, quotes, orders, campaigns, sales teams, territories, channels, products, services, contracts, or billing.
These are just a few of the concepts, but what is important to understand is again it these are consistently addressed across finance, administration, HR, marketing, and other departments?
Is the data that represents all these business concepts being managed consistently across the multiple systems?
Is all this data being treated under the same rules, is it consistently maintained and up to date?
Going back to the sales objectives, to be properly defined we need an additional layer of data.
When defining sales objectives, there are defined according to time cycles, number of leads, win rates, revenue, profit margins, customer acquisition costs, customer retention, cross-sell and upsell, among others. A new set of business concepts, most of them composite.
Is this additional layer of data being managed consistently across the organisation? Are they all being calculated using the same sources? Calculated in the same way? With reliable quality levels?
It’s critical to set clear sales goals and an action plan, but also critical to be able to control those objectives, to be able to measure sales performance.
The capability to control this is directly related to the capability to control and manage data underlying these processes.
The role of data governance
Data is critical in this process, critical in the way that it turn to be a valuable asset or easily become a liability.
To make it work, organizations need data. Organizations need to make decisions based on solid data to make effective decisions that will help grow your business.
Data governance is a key strategic initiative, to only way to ensure critical data assets are reliable, secure, and available for business.
Data governance is just a part of this process, though a critical one, assuring the roles, responsibilities, and processes for ensuring accountability for data.
The role of data governance goes far beyond this case presented here, the sales objectives, but extrapolated to other cases to enable organizations to minimize risks, implement compliance requirements, increase the value of data, reduce costs and to assure the best efficiency possible in every corporate process.