Flawed thinking has it that there’s nothing important or exciting about the “middle.” Just ask Jan Brady or any nose tackle on a defensive line. But the middle of your sales funnel is really important – opportunities have to be watched and decisions made based on status and progress. Which ones will make it? Which ones will fall out? What’s my next step? The decisions we make on opportunities in the middle of the pipeline will prevent surprises later and will help us to put the right resources on the right deals at the right time. If we don’t make the right decisions, or worse, neglect these deals, it usually results in fallout, or what I call “zombie” deals that linger around cluttering up the pipeline. These zombie deals steal time away from us on thought process, manager conversations and important resources. If we do go about it the right way though, more closes, faster cycles and accurate forecasts happen.
So, in order to make the right decisions and make an impact in time, the focus should be on these three things:
- Deal Progress – This is your step-by-step sales process. Most companies use stages to track deals and move them to the next stage as milestones are achieved and questions are answered. Sales reps qualify deals for authority, need, urgency and money. I want to emphasize “authority.” The information received on opportunities must be validated by the decision maker while anyone else tied to the deal is just to win them over. Having a sales process aligns the reps for consistent behavior. Details on deals are usually discussed verbally between a sales rep and their manager, but ideally all details should be recorded in the CRM. By having this data up to date in the CRM, the manager can review deals and spend more valuable time discussing what plays to run and pointing out important pieces of the deal that are missing. Also, if this detail is recorded in the CRM, analytics can be used to improve the sales process.
- Deal Momentum – This is where I look to find deals that are stuck and deals that have the right buyer engaged. Typical things I look for to determine proper velocity are:
- When was the last activity date?
- When was the last communication with someone in authority?
- Is the next meeting scheduled?
- How compelling of a need is this that it can make someone buy now?
Once again, it’s better to have these things recorded in the CRM. I do my prep work for the Monday sales meeting on Sunday, and I don’t want to contact reps on the weekend for questions or updates. Also, at the end of the sales period, I want this information in the CRM for me to apply analytics on sales process improvement and performance.
- Ideal Customer Profile – This is information about the ideal prospect, which provides more confidence that a close is inevitable. For B2B sales, this is usually size, market or industry and whether you are engaged with the appropriate buyer who has purchase authority. For B2C sales, I know an example of a company that sells solar panels and they look for certain credit scores of residences, homes where the roof faces south and for prospects to bring their utility bills to the meeting to compare the cost savings. Once again, this is ideally recorded on every lead and opportunity in the CRM to track for analytics.
Do not engage resources or include pipeline deals in the forecast until you have a good handle on the above three things. Applying a score, as a deal moves through the process on these three criteria helps enormously. It is critical in determining how many will make it through the pipeline, which are worth resources, and which to apply to the forecast.
There’s nothing more exciting than adding confidence to a pipeline and forecast, but it’s even more exciting to close more deals at a faster pace by applying these three tenets to managing your pipeline.
Click here if you want to learn how to automate these processes discussed in this blog.
The search for the perfect balance between what your sales people say and what the data in your CRM reflects reminds me of reading about Ponce de Leon’s 16th century search for the Fountain of Youth. Expeditions were provisioned and ships set sail for the new world, but despite great effort and expense, the fountain remained elusive and ultimately undiscovered.
Sales people are interesting, complex and highly differentiated. Like snowflakes, no two are perfectly alike, and generalizations can be unwise. That said, for the purposes of this discussion, it serves my purpose to discuss two “personas” whose attributes you may recognize in some of your salespeople. I will call them Harry “Happy Ears” and Sally “Sandbagger”.
When you look at your pipeline and opportunity management process – collectively known as your sales process – you are often balancing what the forecast and opportunity notes reflect against either Harry “Happy Ears” tendency to be unrealistically optimistic or Sally “Sandbagger”’s proclivity to never commit a deal to the forecast until the day it closes.
In the many, many forecast and business reviews I have conducted, there are some Harry and Sally moments that will be forever etched in my mind. For example:
Q. Harry, why do you think this deal will close by the end of the month?
A. Because they like me!
Q. Anything else, for instance do you know what steps remain to getting the deal done?
A. Nah, but don’t worry, I’m taking my contact to an expensive lunch and a ballgame this week. And they really like me!
Q. Sally, you have made your number 12 straight quarters in a row, but you are forecasting to be at 20% this quarter, should I be concerned?
A. No, I always make my number
Q. Then why aren’t you forecasting any deals for this quarter?
A. Because I don’t have the PO’s yet.
While these conversations may be humorous in retrospect, when you are trying to make your number and understand your deals, there is nothing funny about not being able to discern which deals are real and which are not.
So what do you do? The “black art” way is to handicap and arbitrage without having the necessary underlying information. For Sally, you take the bet that she can be counted on for 13 deals this quarter and hope that 13 is not her (and your) unlucky number. For Harry, you adjust his forecast down and then tell your manager to jump in and micromanage the sales process in the hopes that you can find the bedrock of his forecast and rebuild from there.
The state-of-the-art method today is to define and then track the discrete and necessary checkpoints for opportunity advancement. For example, if there is no budget, or identified compelling need, then your opportunity likely has an empirically lower measurable probability of closing in your timeframe. If an opportunity has little or no activity and has sat in a stage for two or three times longer than similar deals in your wheelhouse, then the opportunity is stale and this points to trouble.
If you can capture the important attributes of your opportunities without sentencing your salespeople to the land of a thousand clicks and at the same time, remove from their purview the ability to color their deals with their subjective Harry or Sally bias, then you have the foundation for a more accurate, predictable and controllable sales process.
For more on this, please check out my 0n-demand webinar with my sales VP friend, John True on “How to Supercharge Your Sales Process”.
In the meantime, if you would like to learn more about how TopOPPS addresses this problem, by giving you the right tools to define, manage and control your sales process, please contact us at 800.222.2323 or let us give you a demo.