Sales Training: Self Assessment for Driving Revenue Growth

Sales Training Article: Self Assessment for Driving Revenue Growth

By Jim Naro, CustomerCentric Selling® Business Partner

I often get called into an organization when revenue growth stalls. I start at a high level to discover where there are missing links and broken pieces within the sales organization to determine what's needed to get back on track. What I've outlined below will give you a starting point for assessing your own organization.

Effectiveness = growth
The first thing I do is look at the effectiveness of the organization, which is its ability to drive long-term revenue growth initiatives. Although achieving a revenue number is often considered an important measure of performance, there are more telling metrics. So I also evaluate, when available, the number of net new customers, net new business from existing customers, new market accounts, average deal size, revenue per sales person and overall pipeline health.

Using these metrics, I can tell how well-defined an organization's sales effectiveness is, and consequently, its sales readiness and sales enablement capabilities. While these terms are used somewhat interchangeably in the industry, I have found that sales readiness encompasses everything needed for building selling proficiency, while sales enablement involves the development of market and product fluency.
For strategic growth initiatives to be successful, these two elements must be operating optimally and well coordinated. When elements of one or the other are off, or perhaps absent all together, the sales effectiveness of the organization is diminished, sales growth stalls and, ultimately, sales performance takes a hit.

How proficient are your sales people?
If you want to assess sales readiness in your organization, take a look and see if your sales people have the right selling skills to support your organization's strategic growth initiatives. Specifically, how proficient are they in preparing and executing key conversations with targeted buyers, from identifying business objectives to uncovering value and understanding the buying process? An assessment of sales readiness will uncover what you need to put in place to move qualified opportunities to closure. You may need to re-assess your sales methodology and support processes, ongoing sales skills development and training programs, pipeline models, forecasting capabilities, and territory and account planning.

If something is off, ask yourself these questions: Where and why do opportunities get stuck in the sales cycle? Do I have the right sales processes and methodology in place to facilitate my customer's buying processes? Are the activities of my sales organization aligned with the overall objectives of the company? What skills need further development to better support my sales team? What are the missing or weak links?

Are my people armed with the right support?
The other part of this two-prong foundation is sales enablement. This is essentially how well an organization provides intelligence for its sales team in terms of information and data about your products, markets and buyers. This includes knowledge-based support tools that help sales people prepare and execute sales calls. These support tools include market knowledge, product usage expertise, sales messaging, success story libraries, competitive information and business value assessments.

To assess your organization's capabilities in this area, ask these questions: Has sales and marketing agreed on the verticals, job titles and business objectives for key markets? How easy is it for sales people to identify and leverage information about successful customer implementations? How much time does it take a sales person to prepare for a sales call? Does he or she need to reinvent the wheel for each call? How effective are sales people in executing those calls and gaining access to decision makers? How often do you win when given an opportunity to compete for the business?

Greater effectiveness - a ready and enabled team!
Improving sales effectiveness is a cross-functional, company-wide issue, and requires extensive collaboration between sales and marketing. When sales readiness and sales enablement are fully functioning, you'll have a more effective sales organization and you'll be able to drive long-term revenue growth.

Read our sales training articles.

Sales Training Article: 10 Avoidable GTM Mistakes for Inside Sales

Sales Training Article: 10 Avoidable Go-to-Market Strategy Mistakes for Inside Sales

By Scott Gruher, Sales Benchmark Index (SBI)

Inside Sales is the fastest growing Go to Market Strategy channel. In fact, it is growing almost 15 times faster than outside sales. Why? Buyers have less time for sales reps and organizations want to deploy more efficient sales channels. That being said, buyers still require a certain level of a personal touch. Inside sales offers efficiency with little risk.
 
Many organizations are realizing this fact and implementing Inside Sales. The urgency and excitement to utilize a lower cost sales channel can lead to costly mistakes.
 
10 Inside Sales Mistakes and Solutions:
 
Mistake #1: Pulling the plug too early – you won’t see results overnight
 
Solution: set a realistic timeline for results. Set milestones to track earlier success
 
Mistake #2: Lack of role Prescription/Cadence – “any activity is good activity”
 
Solution: a clear sales performance management framework is essential to ISR success. Broadcast leading indicators to gain momentum
 
Mistake #3: Weak Comp Plan - low risk / high base pay
 
Solution: ISR Comp plans should be highly leveraged. Pay for performance, not for showing up to a cube five days a week
 
Mistake #4: Moving outside reps to inside – bad outside reps don’t make good ISRs
 
Solution: determine if they are a role fit as determined by their competency profile, motivation, and past results
 
Mistake #5: Poor Onboarding Plan – viewing ISRs as a less skillful position
 
Solution: Inside Sales should have a professional onboarding program that covers the gamut of sales skills, CRM usage, product, company, industry, etc.
 
Mistake #6: Wrong Hiring Profile – you can’t fix hiring the wrong person
 
Solution: design a specific hiring profile for ISRs
 
Mistake #7: Blending roles – allow Inside Sales to focus on specific selling tasks
 
Solution: focus ISRs on a specific selling task (lead development, irtual new business sales, account management)
 
Mistake #8: No dedicated leader – being an afterthought isn’t a recipe for success
 
Solution: ISRs require ongoing coaching and training from a dedicated Sales Manager
 
Mistake #9: Decentralizing – don’t put them in local offices or home to reduce disruption and save cost
 
Solution: a centralized team that shares best practices, attends training together, and develops team camaraderie
 
Mistake #10: Lack of process – “winging it” is never sustainable
 
Solution: ISRs should utilize a formal sales process (or Lead Mngt process if acting as a Lead Development Rep) just like an outside sales professional
 
 


Don’t rush Inside Sales implementations or your attempt to improve efficiency could backfire. Avoid the 10 costly mistakes listed above and reduce the risk of wasting valuable resources, excessive turnover, and customer and prospect confusion. If you already have implemented Inside Sales as part of your Go to Market Strategy, review your current processes and mid-course correct where necessary.

Sales Training Article: Three Critical Times to Get a Coach

Sales Training Article: Sales Management - 3 Critical Times to Get a Coach

By Dan Perry, Sales Benchmark Index(SBI)

Sales management is consistently told they need to coach their sales people. Blogs are written, books are published and magazines are printed around the correct way to coach sales people. Almost all of the sales management content that is written or trained is centered on sales managers coaching their sales people. And for good reason:

• Proper coaching of sales people can provide a 35% productivity increase
• Training content retention improves 400% if sales people are coached within 30 days of the training event
• Coaching by a sales manager to a sales person that occurs more than three days a month results in averaging 107% over quota
• Situational coaching of sales reps to either tenure or performance can give over a 45% boost to their sales performance

We all know that a sales manager coaching their sales people is good for business. It is good for revenue. It is good for retention of talent. But there is a big gap in coaching.

Who is coaching the sales managers?

Let us first ask the question: Why should a sales manager (even a good one) have a coach?

• Top athletes and the best singers have coaches. Kobe Bryant (recent NBA Finals MVP) and Taylor Swift (won entertainer of the year 2011) are at the top of their game. They actually have two coaches each.
• Kids have coaches. Tutors help them with homework trying to improve grades. In my daughter's elementary school, 85% of the 'A' students have tutors.
• Sales VPs have coaches. Our firm currently coaches many Sales VP s on numerous sales force effectiveness issues. Almost everyone who we coach already exceeds quota or will exceed quota in 2011.
• CEO's have coaches. Many of the companies we do business with each year have effectiveness coaches. These CEOs all have EBITDA growth over prior year.
• Surgeons have coaches. Recently my neighbor had open heart surgery. He told me before they 'knocked' him out that the surgeon was talking with someone in the operating room. When he asked later who that was, the surgeon indicated he was his coach. (This surgeon preformed open heart surgery on Barbara Walters recently)

The next question is: When should you have a coach?

Three critical times to get yourself a coach:

1.New to the company. Your on-boarding inside a company is critical to your long term success. Many organizations don't even have an onboarding program or the ability to get a coach. Yet, this is where you form the foundation for sustainable success in an organization. Make sure you understand the need for a coach. One who can help you get better in core SM fundamentals.

2.Plateau. No matter how well trained people are, few can sustain their best performance on their own. When you have reached the top in certain metrics and stalled your performance, the numbers can typically only go one way=down. Realizing when you have peaked is a challenge. Most people go into denial thinking they can get back on top with extra effort. Likely is the case.

3.Goals: Do you have a goal that seems unattainable? Do you want to be a VP of Sales someday? Do you want to consistently exceed quota? Whatever the goal, you need extra effort to achieve it. A coach can help you stay on track through execution. Especially the times when your failures exceed successes. Developing a strategy and staying tactically focused is where a coach can help.

The next question is: How do you pick the right coach?

Choosing the right coach is as important as the coaching itself. Making a mistake can set your development and performance back dramatically.

Four key areas to choose the right coach:

1.Experience and Empathy. It must be someone who has done the sales management job. To walk in someone's shoes is to really know them. The things you need coaching on are the difficult situations and critical moments. This is where most sales managers can improve.

2.Personal feedback. Every sales manager is different. Make sure your coach can personalize the feedback for you in order to understand, accept and act on it.

3.Impartial. Often the key to expert feedback, this person has to communicate a strong message without concern for your feelings. Identifying a common goal is critical to coaching to that goal. The ability to separate emotion and give the feedback as constructive is essential in your development

4.Tactical. You must be able to implement the coaching actions. If the feedback and direction is too strategic or general, you simply won't act on it. Insist the coach can provide specific suggestions you can weave into your everyday. This way you will actually do it.

If you are lucky, your boss could turn out to be the right one. Or it could be someone close to you personally:

• Itzhak Perlman (the famous concert violinist) had his wife for a coach, a concert level violinist herself. "I was very, very lucky. The great challenge in performing is listening to yourself. My wife always says that I don't really know how I play. She is the extra ear." (Sounds similar to a sales manager having a one on one with a sales rep)
• It could be someone who you recruit to be your coach. Probably it is someone you already know. Identifying the need and seeking out a coach is tough work. Spend time on it because it requires a high amount of self-esteem. You must be able to identify when you need the help, even if you are on top of your game.
• Russ Mellott, SVP of Sales at Epicor, exceeded his quota by over 20% in FY 2011. He understood the need of continuous improvement. So, Russ hired a coach. The result: Russ rarely ever misses a coaching session. Russ consistently makes his company goal. And Russ just got promoted. Call Russ and ask him if a coach has helped him.

Metrics prove that coaching will dramatically help your sales productivity. And conversely, it will help your sales reps productivity because you will be a better coach to them. This is a critical step in the journey to be world class.

Sales Training Article: 2012 Sales Management To-Do List

Sales Training Article: 2012 Sales Management To-Do List

By Dan Perry, Sales Benchmark Index (SBI)

It's 2012 and time for Sales Management to begin a new year, new quarter and a new quota. That means a new To-Do list for hitting all those goals you talked about in November and December now in January. Couple of key stats and best practices to keep in mind when creating those To Dos:

• 23% of sales managers spend more time making the lists than doing the tasks on them
• 93% of sales managers who made a To-Do list FOCUSED on hitting their goals made their quota last year
• PS: This means you have to have goals
• 18% of all To-Do lists are lost. (make sure you don't lose your To-Do list or you will have another To Do)
• Effective To-Do Lists are limited to specific tasks that can be tackled right away and finished fairly soon. Think "help Johnny improve on probing questions"; not "help Johnny make his quota."

So what is on World Class Sales Managers To-Do list in 2012?

1.Understand how I am going to make my quota.
Use your best metrics to plan: What is required at the top of the funnel to make the number at the bottom?
TIP: Figure out each sales reps: Close Rate; Average Sales Price; Sales Cycle Length. Then do it for your team.

2.Create a virtual talent bench.
The Best Sales Managers are always trying to upgrade their talent. You need to keep replacing your 'C' players with 'A' players. Upgrade Baby.
TIP: You need 1 sales rep candidate for every 3 sales people.

3.Set up regular sales meetings, one on one meetings and field rides in the calendar NOW.
Cadence is the key to coaching and developing. Make sure you have defined times with each person for every sales meeting, one on one and field ride. Your reps will improve.
TIP: Schedule these a month in advance. Your sales person has enough time to schedule a packed day full of customer visits.

4.Spend 75% of my time coaching my people. Plan my calendar for January today.
All other tasks are just noise. Everything comes from being with your people and your customers.
TIP: Coaching gets blown off when the boss calls. Put these one on ones in your calendar so when he does call you don't answer the phone because you are in a meeting with your rep. Call him back later. He will understand. If he doesn't, you have a lousy boss.

5.Look for resistance in all of my communication methods.
Resistance to your messages is common. Learn to identify and manage the objection.
TIP: Most common form of resistance = Silence

6.Follow the sales process on EVERY deal.
Using the sales process can improve closing rate up to 45%. Adherence to the process will help your sales reps match the buying process.
TIP: Don't think your sales process matches the buying process=Think like your customer and change it.

7.Don't sell every deal for my sales people.
You hired them to sell. Why do you have to bring in the bacon?
TIP: Watch bailing out a rep in the late stages of a deal. If this happens your rep hasn't done a good job uncovering the root customer problem.

8.Implement a time management tracking process for my sales reps this week.
Selling time has decreased in 2011 below 50%. How are your people spending their time?
TIP: This is a challenge but will literally give you back 25% of your time.



9.Coach my sales people to their tenure and talent.
Don't Peanut Butter Spread coaching across your people. They need teaching, directing, cheerleading and motivation. Determining when and where to use these methods is key to increasing performance.
TIP: New people need teaching. Veterans need pure coaching and motivation.

10.Download the new E-Book: Promoted to VP of Sales: The Year 1 toolkit.
The fundamentals in this book are core no matter if you are new in a sales leadership position or want to understand how sales leaders fail and how to turn it around. (Download it here)
TIP: I wish I had this book when I was promoted.

Successful sales managers make sure their time spent matches what is important. The To-Do list is how you spend your time. It is the most effective way to prioritize how to make your number. Make sure your To-Do list is filled with customer facing and sales rep facing actions. Not internal administration work. 77% of the list needs to be centered on selling time activities.

Jon Doffing of Epicor asked me 9 months ago how he could turn around his performance. I began asking him how he spends his time every day and week. We started to break down his activities and found it began with his To-Do list. Whatever was on the list got done while other needed tasks were put off until 'he could get to them'. We decided how he spends his time was critical for him to make his number. And we agreed his To-Do list was the backbone of how he spent the time.

Be careful with your To-Do list. Mirror the 10 suggestions stated above. Covet your time in 2012 to the actions that drive revenue. You need to make your quota. You need to be successful.

Sales Training Article: How Much Does a Bad Sales Call Cost?

Sales Training Article: How Much Is a Bad Face-to-Face Sales Call Strategy Costing You?

By Scott Gruher, Sales Benchmark Index (SBI)

Do your marketing strategies include lead generation, sales methodology, and utilizing virtual selling technologies? I was recently on a sales call with a software organization that had four sales resources onsite for the meeting and two called in virtually. This was the first sales call with this customer regarding a new product line (they already had a relationship). All four sales resources traveled in from all over the United States for a face-to-face sales call. This isn’t an unusual occurrence.
 
Let’s take a look at the impact of using this antiquated selling approach:


 
How can you combat this high Customer Acquisition Cost?
 
Marketing Involvement
 
Define a target audience and have marketing drive demand through inbound and outbound activities. Marketing will help guide buyers through the buyers journey before sales is engaged. Direct sales resource time will be focused on a higher quantity of qualified leads.
 
Impact - more leads, higher quality leads, reduction in customer acquisition cost

Sales Methodology
 
Provides guidance regarding who should attend interactions at each step in the process and if the call is best executed virtually or face-to-face. The methodology will also ensure each sales interaction is well organized and specific call objectives are identified.
 
Impact – Improved sales cycle velocity, higher closing ratios, and larger deals

Virtual Selling
 
While face-to-face sales calls aren’t completely obsolete, you don’t necessarily need the entire engagement team onsite. Having 4 resources in a room for a 90 minute meeting is typically not the most effective way to engage a customer.
 
Impact – reduction in customer acquisition cost, more activity
Let’s look at the impact:
 
Scenario Two:


 
It is almost $27K less to run the second sales campaign. Multiply this number times the total number of sales campaigns your sales team works over a 12 month period. The cost impact is staggering.

Call to Action:
 
1.Utilize marketing to engage buyers early in the buying process to ensure direct sales resources are focused on qualified leads
2.Use a defined sales methodology to improve the effectiveness of interactions
3.Leverage technology to perform interactions virtually whenever possible as part of your Go to Market Strategy

Sales Training Article: Sales Role Clarity to Improve Effectiveness

Sales Training Article: Sales Role Clarity Tips to Improve Effectiveness

By Scott Gruher, Sales Benchmark Index (SBI)

Each sales role should have a cadence that defines which activities should be performed on a daily, weekly, monthly and quarterly basis. The days of “sales as an art” are over. While talent and skill are still major success factors, there is no substitute for doing the right things on the right frequency.
 
Measuring leading indicators for success is how World Class sales organizations ensure they are making decisions based on what is about to happen vs. looking in the rear view mirror at what already took place. To achieve leading indicators goals, your sales team must understand what activities are expected. A clear role cadence brings clarity to how the day-to-day of the role should be executed.
 
Example Account Manager Role Cadence: 



Sales Role Cadence Components:
 
Define interactions with direct supervisor - 1-on-1 coaching, training meetings, field time.

Define interactions with account stakeholders (or prospects in hunter role) - who does the Account Manager need to be interacting with and on what frequency?

Outline meeting topics for discussion - what is the purpose of each type of meeting and with which stakeholder should the meeting be held?
Outline role scope - how many accounts, total revenue managed, pipeline size, etc.

The activities captured in the cadence are the recipe that helps the sales professional meet their scorecard metrics. Developing a sales role cadence brings clarity to how each role within the sales force contributes to the sales strategy. This will help alleviate inefficiencies due to duplicative efforts and make your Go to Market Strategy more effective.
 
Call to Action:
 
1. Clearly defined the reporting structure and responsibilities for each sales role
 
2. Define customer and/or prospect touch requirements
 
3. Outline the desired portfolio or territory size for the role

Sales Training Article: Pricing Strategy the Sales Training Gap

Sales Training Article: Pricing Strategy, the Sales Training Gap that Leaders Ignore

By Matt Sharrers, Sales Benchmark Index (SBI)

In 2011, we surveyed and interviewed over 12,000 sales people about sales training. When we asked what area of the sales process reps wanted help with, 4 out of 5 answered “Pricing/Justifying Costs/ROI for our product/service”. Sales people are uncomfortable having the pricing discussion. And leadership is letting them down by not developing their skills.

The impact on the sales force is stalled deals. Sales cycles get extended. Reps pester customers. Managers pester reps. VPs of Sales pester Managers. Everybody is staring at the forecast keeping score. The best sales leaders have changed the game with pricing by involving the key stakeholders (internal and external) early in the sales process. The best leaders use the following 3 steps to solve the Sales Training Gapin Pricing.

#1 - Exit Criteria—does your sales process have exit criteria? Exit Criteria is observable customer behavior that signals the buyer has progressed to the next stage..
Why does this matter—Sales people throw price out too early. Most times customers ask for a number because they have been conditioned to do so by other bad sales people. Unless a customer has clearly articulated all of their problem solving options and ranked them, you cannot discuss price. Why? Because you will have no ability to put a thoughtful proposal together that is focused on what matters to The Customer.

#2 - Collaboration—does your sales process have a step for collaboration with the customer on pricing?
Why does this matter—Budget—is this a replacement spend or new spend? If new, where will the money come from? They will have to create budget and it is your job to show them a believable revenue lift (longer term) or a tangible cost savings (short term). If your solution does not grow revenue or reduce cost In the Eyes of the Customer, you are done. If they don’t have some overwhelming compelling event that is creating urgency for you, the lack of value is the reason for the stall. That is a fact.

#3 - Internal Approvals—does your sales process have a fluid, easy process to get pricing for a customer?
Why does this matter—We see too many companies where non customer facing stakeholders (finance, procurement, legal) are making customer facing decisions without any customer facing knowledge. If this is happening don’t blame them. Blame sales leadership. It is the job of the sales leaders to ensure back office process is smooth and there is trust. Take these people out on some sales calls. Expose them to what it means to get a customer. Show them your customer acquisition cost.

Call To Action -
Make the investment in the 3 stakeholders. Your ability to help your reps, your customers and your company understand pricing is a valuable exercise. The talent management activities above can generate a nice Q1 ROI in a short period of time.

Sales Training Article: 4 Things to Do to be Promoted

Sales Training Article: The Four Things a Sales Manager Needs to Do to be Promoted

By Dan Perry, Sales Benchmark Index (SBI)

"Why do some sales managers get promoted and others just change companies never moving up the ladder? How can a sales manager get promoted to a director or VP? What does it take to move to the next level?" I get asked these questions every week. Everyone wants to know what the 'secret sauce' is to get more responsibility and fatter paychecks.

The Statistics are pretty compelling to make the move. Getting the bigger gig has average OTE (On Target Earnings) increase by 1.4X-3x what a Sales Manager makes. When I moved from a Sales Manager to a Director of Sales, my OTE jumped 1.5X. When I moved from a Director to a VP, it moved another 1.5X. And when I moved to a SVP of Sales it reached 3.5X what I made as a SM.

But the number of Sales Managers that get promoted is slim. Out of 100 Sales Managers, only 32 get promoted to a Director. Of the 100 SMs, 17 make it to a Director of Sales and only 9 make it to a SVP/VP of Sales. (Similar to professional sports!).

What can you do to get ahead?

4 Ways a Sales Manager Needs to Get Promoted:

1) - Make the Number. Let's face it. You need to make your quota. In fact, you have to 'blow it out'. We have numerous blog posts on how to exceed your quota. But overall: focus on a sales process mapped to a buying process, recruit great talent and have coaching become a way of life.

2) - Communicate Effectively. Most people really screw up communication. Effective communicators get ahead in life. They understand how important it is to get the desired behaviors from your team immediately. Usually with one message. This is the real way to get superior performance. There are numerous ways to communicate and some key best practices to ensure effective communication happens. Take this seriously.




































3) - Recruit 'A' Talent. Nothing takes the place of great talent. 50% of your effectiveness is the talent you have on the team and the performance conditions you place that talent in. Consistently push for upgrading the team. Recruit the best people. You can never stop recruiting for top talent. SMs that get promoted have a pipeline of people that can replace them. Many VPs of Sales have told me they won't promote a SM because there is no one to take their spot. Don't be this person.

4) - Manage your Time. Everyone has the same amount of time. Why can more people get things done in a day then others? One answer: Time Management. Ask any VP of Sales how they got there… great time management. We call this life hacking. Tip: The blur between work and personal time is nonexistent. No longer can you just work Monday - Friday from 8AM to 5 PM. If you are going to have an ideal life, you must manage your time.

4.5) - Continuous Education. Sales People who get promoted never stop learning. We call it new capability acquisition. We are fanatics about it at SBI and judge ourselves on what we are learning. Promotable people never stop 'gaining new capabilities.' Some questions to ask yourself if you are continuously being educated:

Do you have a LinkedIn account and active on it?

Do you read over 15 blogs a week on sales and marketing including demand generation? (The cold call is dead)

Can you tell me your Klout score?

How well do you participate in social media?

Leads from LinkedIn have a 49x higher conversion rate than Google
What metric can you tell me has improved in your business in the last quarter acting on what you read recently?

If you can't answer these questions, ask yourself Are you pedaling faster?
Getting promoted takes perseverance. It takes keeping your eye on the strategy while executing the tactics. It requires doing what your boss wants you to do. In the book, Success for Dummies, it clearly states to get promoted, do what your boss wants you to do. Don't forget this simple rule.
One of my former sales reps who I hired years ago just got promoted to a VP of Sales for a major consumer products maker. I couldn't be more proud of Bryan Fry. Why did Bryan get promoted? Perseverance, intelligence and great competencies come to mind. But a lot of people have these. What made Bryan stand out was pretty simple: consistently making his numbers, vigorous attention to learning, effective communication, superior time management and always looking for the next superstar to bring on his team. It took years for him to accomplish this goal and get the big gig. It wasn't easy. He could have given up. But Bryan always remained focused on the 5 core fundamentals stated above.

Want to make the big move? Get your priorities in line. Focus on what's important.

Sales Training Article: How much risk is in your forecast?

Sales Training Article: How much risk is in your forecast?

By Jim Naro, CustomerCentric Selling® Business Partner

Forecasts are supposed to be built from pipeline opportunities that have a high probability of closing within a specific timeframe, which is often 90 days. To create a forecast, sales people typically look at their pipelines, attribute a revenue number to the deals they think might close, and then roll those numbers up. With sales force automation tools, sales people can even just check off a box and directly feed those deals into the forecast. While helpful, this simple activity makes it easy to inflate the numbers, especially if the sales people are strongly influenced by pressure from above to achieve revenue goals.
 
Regardless of how sales people build their forecasts, if opportunities are moved into the forecast prematurely just to meet revenue expectations, a certain amount of risk is automatically introduced. It’s the job of sales management to access the risks and discern the degree of risk before they create their own forecast. Here are some clues to help determine forecast risk.
 
1. Are the sales people having conversations with the right people?
By the time an opportunity gets into the forecast, a sales person needs to have established several contacts within the prospect organization. These contacts help to, a) confirm that the sales person’s solution is a good match for the needs of the prospect, and b) identify who the decision makers are, including those involved in getting the solution sold, funded and implemented.
 
If there is an opportunity in the forecast and those contacts have not yet been established, then there is a possibility that this is not really a 90-day revenue opportunity. Sales management needs to understand what inroads have been made and what the quality of the conversations were to determine the degree of risk.
 
2. Has the buying process been clarified?
The clue here is whether or not the sales person understands the buying process of the prospect. For instance, if an opportunity is in the forecast, a sales person should know whether purchasing, other vendors, or third-party consultants will be involved. Additionally, the sales person should have already sufficiently proved that his or her solution does what the buyer needs it to do. Implementation planning should already have been discussed and documented as well.
 
Also, there should be no show-stoppers regarding legal terms and conditions, especially liability or indemnification clauses.
 
Once again, if any of this is not in place, sales management needs to assess the validity – and associated risks – of the opportunity and the potential of it extending beyond the forecast window.
 
3. Might the deal be lost to inertia?
Unfortunately, great sales cycles can end with a buyer deciding to do nothing. In fact, research shows the largest single competitor, and therefore the largest risk in forecasting, is no decision at all.
 
Therefore, unless buyers understand that it’s more painful to bypass a buy decision than it is to make the purchase, then there is a no-decision risk.
 
It’s key to find out if the sales person has effectively facilitated a cost/benefit analysis for ROI calculations that internal champions can use in securing funding. A lot of building value like this falls short because sales people are not effective in facilitating this type of analysis.
So if this isn’t already in place, consider opportunities at this level full of risk.

The risk associated with each of the above three scenarios can be eliminated by building steps, processes and training into the sales cycle. When it gets right down to it, unless sales people know that only opportunities that have met the criteria and qualifications mentioned above can be put into the forecast, there will be risk. So it’s up to sales management to decide if they want to play a game with high risks – or minimize and even avoid risk with a few process modifications and a bit of coaching and selling skills development.

Sales Training Article: Business Development

Sales Training Article: Business Development

By John Holland, Chief Content Officer, CustomerCentric Selling®

CustomerCentric Selling® (CCS™) has launched a one-day Workshopfor customers and prospects that focuses on business development as a process. Defined steps in prospecting efforts are important because an American Marketing Association (AMA) survey found that on average it takes sellers more than seven attempts to initiate contact with executives. In light of this statistic it is sobering to realize the AMA also found that a small percentage of salespeople make more than three attempts to contact Key Players. With successes being few and far between, it isn't difficult to realize why general territory sellers feel prospecting is the hardest part of their job.

Business development skills are critical to empowering salespeople to build adequate pipelines and in doing so, have the ability to disqualify opportunities that are unlikely to result in buyers making purchasing decisions. My belief is that in painting with a broad brush, the vast majority of sales (or buying) cycles begin in one of two ways for companies that implement CCS™:

--Salespeople proactively engage Key Players and take them from latent to active need around a business outcome. Consistent with our core concepts, it doesn't make sense to call at low levels for unbudgeted initiatives and sharing business goals or admitting problems start buying cycles.

--Mid to lower level buyers leverage the Internet and social networking to do significant research about a given offering and are well along in the process (Sirius Decisions indicates buyers are 70% through buying cycles) before they contact salespeople. As you can imagine, by this time buyers believe they know their requirements and will not be receptive to premature seller attempts to change them.

As indicated in Rethinking the Sales Cycle there are an increasing number of evaluations that begin below Key Player levels. Despite all of this activity, one statistic that seems to remain a sore spot for vendors is "no decision." This occurs when buyers get multiple vendors involved, have them generate proposals but ultimately decide not to buy, or to develop a solution in-house. Why does this happen?

I believe non-executive buyers behave in a similar fashion to struggling salespeople. They are too product focused and fail to consider the potential value (business results) that can be achieved to offset the cost of the offering being evaluated and have trouble articulating what it is they want to buy. Because they cannot create budget for new initiatives fairly late in their evaluations they approach a Key Player leading with product and asking for money to buy it. Unless the Key Player somehow "gets it" they are told there is no money to fund the initiative, so it should be tabled. Even for internal customer evaluations, the first core concept of CCS™ should apply: No goal, no prospect.

CustomerCentric Selling® provides ways for sellers and managers to understand the difference between activity and progress. It appears mid to low level buyers are spending a great deal of time (activity) in evaluating vendor offerings on their own, but internal selling is a difficult job and many of these evaluations result in no decision.

Salespeople, whether being brought in late into evaluations or initiating them at Key Player levels, do potential buyers, their companies and themselves a service by uncovering desired business outcomes from Key Players as soon as possible. Gaining buy-in from Key Players and access to the people that will be involved in buying decisions qualified opportunities and means the result of activities is progress through buying cycles. Taking these steps minimizes the chances that the final decision will be no decision.

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