Step One: Assessment
An assessment is an evaluation. An evaluation includes taking the right measurements. In our work as MLM consultants and party plan consultants, we use a set of Key Operating Indicators (KOIs) to measure the business of each direct selling client. While some of the indicators apply to all types of direct selling companies, others are specifically for network marketing or party plan companies.
Your direct selling software may provide some of the data, but often additional work is required to measure and report everything that we want to see. Business improvement takes work, but the work is worth the effort.
Assessment is only the first step. There are several more to follow.
Step Two: Establish Goals
When improving any business, it’s best to define what is meant by improvement. Here is where the work to report the Key Operating Indicators pays you back. You can use your KOIs when you set your business improvement goals.
Be specific when setting your goals. For example, if a goal is to improve the percentage of representatives who qualify in your Fast Start Program, define exactly what you mean by improvement. Similarly, if your goal is to increase the percentage of representatives who promote to the second title in your compensation plan, state your goal percentage with a number.
Step Three: Identify Contributors
Before implementing solutions to improve your direct selling business, it is recommended to identify the reasons for the Key Operating Indicators that don’t meet your goals. If you’re unsure, ask the best direct selling consulting firm for help. Whether yours is an established direct selling company or an MLM startup, we can help you.
Step Four: Propose Solutions
If nothing changes, everything will remain the same.
These words of wisdom may seem obvious, but when it comes time to improve a business, actions must be taken. Some actions will require little effort while others are much bigger. Quantifying the efforts of each is important for the next step, which is prioritization.
Step Five: Prioritize Actions
If your company is like most others, you won’t be in a position to simultaneously implement changes to all areas of your business. Even if this was humanly possible, it’s not recommended because too much change delivered all at once can be a huge distraction for your sales force from the core behaviors of selling and recruiting.
At Sylvina Consulting, we believe it can be helpful to estimate costs and revenues and then perform a ranking exercise to help prioritize business improvement projects.
Estimate Costs and Revenues
For each proposed solution, estimate the costs to implement the solution. Include both hourly labor costs and other out-of-pocket costs. Don’t try to be precise in your estimates. Instead, use multiple choice answers (for example, $100, $500, $1000, etc.).
Next, estimate the monetary benefits of each solution. When estimating monetary benefits, be conservative.
When you’re done with these steps, each solution will have been assigned two monetary values.
For each solution, subtract the cost from the estimated revenues. Sort the differences in descending order so that the projects with the highest estimated net revenues to the company appear at the top.
While you may need to move a few projects around simply because some are related to others, this approach helps to prioritize the work ahead of you.
Business improvement is worth the effort. When you take steps to create an even better network marketing or party plan company, you are helping your independent representatives to improve their businesses. It’s good to do good work!