Well, I actually agree w/you about "life", even if it means that I'm sorry 'bout the drought and now the mud. Didn't some parts of Nevada get around 6 inches ; is that where you are? This is cotton territory and, while we've had good rainfall this year, and last, I think, we also had record monthly rainfalls f/much of the area in both SEP and OCT, which are usually quite dry and, therefore, the time to defoliate and pick. I'm not a grower and haven't even planted any ornamental brown or green since they've been trying to eradicate the boll weevil ...
Anyway, I didn't mention real life, much less as part of a "balanced scorecard" approach to performance measurement. And, I'd never suggest that some set of (possibly arbitrary and even irrelevant) numbers, alone, would be a reliable metric. Lots of things look "good" on paper, but it still takes 9 months to make a baby, no matter how many women are put on the project (w/apologies to Frederick Brooks, "The Mythical Man-Month"). Heck, I've got ideas about improving programmer productivity by making mandatory the use of intravenous feeding tubes and "piddle packs" - the numbers look great on paper, but, for some strange reason, nobody has given me any "buy-in" ... Well, what I intimated previously w/re: NPV would probably be overkill, especially given limited scales of most organizations and their available resources, especially time and labor. However, I think we've all pretty much agreed that simply going on total dollars of gross profit, while simple (simplistic?) may not be a good measure of performance either. I'm still ruminating (at my desk, not the ranch) on this and no doubt will add more later. In the meanwhile, feel free to "take it out" on me. ;-) Later, Steve in Memphis ----- Original Message ----- From: "Ben Petersen" <[EMAIL PROTECTED]> To: <[EMAIL PROTECTED]> Sent: Friday, November 08, 2002 4:02 AM Subject: Re: Statistics experts needed > Steve, > > It's raining here. Our ranch has turned to mud (hasn't rained since > May and our soils don't handle it well). So I thought I'd take it out > on you <g, just kidding>. > > IMHO, here's the problem w/ Net Present Value calculations > involving people and organizations. They are just too variable. If you > were working with a bond portfolio, or some other kind of paper, it's > the only way to go. Even if you were trying to evaluate a company's > options as to future operations over an extended period of time, > wanting the best guess as to best profitabililty, OK. But trying to > apply that logic to individuals or small groups doesn't work because > "life happens" to everybody. And the small yield differences from > NPV calcs would simply be overwhelmed by babies being born, > parents dieing, alcohol, elicit affairs and (especially for salesreps) > burnout. > > Of course, the return of double digit bond yields could change > things completely <g>. > > Ben Petersen > > > On 8 Nov 2002, at 11:01, J. Stephen Wills wrote: > > > Okay, gang, this one's killin' me, and I like it. So, I'm gonna' try > > to put my MBA to use here. I've just cracked the book(s) and will > > report more later, as I proceed, but, at the moment, I'd suggest > > taking a peek at "excess present-value index", or profitability index. > > If all the costs of sales as well as revenue streams/inflows can be > > identified, quantified, and dated, then the Net Present Value of the > > profit can be determined. This appears to be typically applied to > > project initiatives rather than the efforts of the individual members > > of the sales team. > > > > However, if a salesperson's profit margin varies, their customers > > time-to-pay (a form of Days Sales Outstanding per Salesperson) varies, > > their Book-To-Bill numbers vary (here, inventory carrying costs would > > be factored in), as well as, potentially, a number of other factors > > that can have a measurable impact on "the bottom line", then the > > monetary worth to the firm of each salesperson's efforts will also > > vary. > > > > Anyway, I'm going to continue looking into this and will be back to > > the topic as soon as I have more to share. > > > > Later, > > Steve in Memphis > > > > ----- Original Message ----- > > From: "tellef" <[EMAIL PROTECTED]> > > To: <[EMAIL PROTECTED]> > > Sent: Friday, November 08, 2002 9:55 AM > > Subject: Re: Statistics experts needed > > > > > > > > > > Ben: > > > > > > >The simplest thing I can think of is to use a multiplier that > > > >amplifies the % profit and still consider the $profit: SP1 = > > > >(10,000*.4)+(.4*1,500)) = 4600 SP2 = (10,000*.4)+(.4*150)) = 4060 > > > >SP3 = (10,000*.38)+(.38*2000)) = 4560 > > > > > > I see the profit% in there (the .4 and the .38), and I see the > > > profit$ in there (1500,150,2000). What does the '10,000' represent? > > > Just a constant number? Your formula seems to work! > > > > > > > > > Tom: > > > > > > >By that I mean to take the $sales and the percent of > > > >profit, drop the decimal from the percentage and multiply the two. > > > >While > > > the > > > >number has no real meaning, it would sort them such that your > > > >example > > > would > > > >rank them as 1-60000, 2-6000, 3-76000, 4-57000 > > > > > > Your way of calculating gives salesman3 the edge, while Ben's gives > > > salesman1 the edge. I think I'll take both solutions to the client > > > and ask them which person, in their opinion, they would want to see > > > 'on top'. Then maybe I'll use that formula! > > > > > > > > > Larry: > > > > > > >Assign each salesperson a rank from 1 to X (where X is the number > > > >of salespeople) according to total dollar profit. Assign them a > > > >separate > > > rank > > > >according to percentage profit. Add the two ranks together, and > > > >print > > > your > > > >list in ascending order of combined rank. < > > > > > > That might work. I'll have to run some numbers through on the > > > actual data and see if it represents that they would want to see. > > > > > > > > > >So, my friend, I would not worry too much. Go to sleep and know > > > >that whatever your solution, most likely they will not be happy. > > > >Because you > > > are > > > >trying to quantify the unquantifiable. > > > > > > That's pretty funny, Enrique. True, but funny. Loved reading your > > > reply. > > > > > > Thanks everyone!!!! > > > > > > Karen > > > > > > > > > > > > > > > ================================================ > > > TO SEE MESSAGE POSTING GUIDELINES: > > > Send a plain text email to [EMAIL PROTECTED] > > > In the message body, put just two words: INTRO rbase-l > > > ================================================ > > > TO UNSUBSCRIBE: send a plain text email to [EMAIL PROTECTED] > > > In the message body, put just two words: UNSUBSCRIBE rbase-l > > > ================================================ TO SEARCH ARCHIVES: > > > http://www.mail-archive.com/rbase-l%40sonetmail.com/ > > > > ================================================ > > TO SEE MESSAGE POSTING GUIDELINES: > > Send a plain text email to [EMAIL PROTECTED] > > In the message body, put just two words: INTRO rbase-l > > ================================================ > > TO UNSUBSCRIBE: send a plain text email to [EMAIL PROTECTED] In > > the message body, put just two words: UNSUBSCRIBE rbase-l > > ================================================ TO SEARCH ARCHIVES: > > http://www.mail-archive.com/rbase-l%40sonetmail.com/ > > > > > ================================================ > TO SEE MESSAGE POSTING GUIDELINES: > Send a plain text email to [EMAIL PROTECTED] > In the message body, put just two words: INTRO rbase-l > ================================================ > TO UNSUBSCRIBE: send a plain text email to [EMAIL PROTECTED] > In the message body, put just two words: UNSUBSCRIBE rbase-l > ================================================ > TO SEARCH ARCHIVES: > http://www.mail-archive.com/rbase-l%40sonetmail.com/ ================================================ TO SEE MESSAGE POSTING GUIDELINES: Send a plain text email to [EMAIL PROTECTED] In the message body, put just two words: INTRO rbase-l ================================================ TO UNSUBSCRIBE: send a plain text email to [EMAIL PROTECTED] In the message body, put just two words: UNSUBSCRIBE rbase-l ================================================ TO SEARCH ARCHIVES: http://www.mail-archive.com/rbase-l%40sonetmail.com/
