Re: Sales Performance metrics

["Dr A Burns" <aburns@q-skills.com>]

Martin,

Deming discusses sales in "Out of the Crisis".  He suggests that control 
charts may be used to identify problems such as those that may be associated 
with an individual's territory or competition, although it is unwise to jump 
to conclusions.

What is definitely a totally incorrect metric, is that suggested by John 
Knutsen, Microsoft Corp Strategy, in the following paper where he reproduces 
a sales performance table built by Mikel Harry: 
http://office.microsoft.com/en-us/help/HA011233361033.aspx   In this table 
he claims that companies operating with "sigma=4" have a "cost of poor 
process" of "15-20% of sales".  This table has been built without any form 
of theoretical or data support.  I find it quite astounding that companies 
such as Microsoft would publish such nonsense.

Dr Tony Burns
www.q-skills.com
a_burns@q-skills.com