Sales Pipeline Management
Several years ago Public Television sponsored a competition called Frontier House. Several families traded in their comfortable homes and modern day lifestyles to live a simulated life in 1880s Montana. This was no walk in the park, fake reality TV experience. From late spring to fall these families lived the frontier experience, Montana style 24/7.
The goal of the competition was to prove they could survive the coming winter. This meant stockpiling food in underground pantries they made with shovels; equipping the home to withstand the cold; chopping enough wood to heat and cook during the winter months. Without wood there’s no fire. And without fire there’s no heat and no way to cook foods. Like Jeff on Survivor tells us, fire represents life.
It was critical that the families correctly calculated their needs to get through the winter. Then they worked back from that to know how to spend their time every day preparing. If they calculated wrong, or worse just got lazy in their execution their ‘lives’ would be in jeopardy. Of course back in the real Montana it was no game. Surviving was the incentive.
A panel of historical experts judged the competitors on how well they prepared. In the end only one family won, but the judges said even this family would have barely survived.
If you think of your sales funnel as a pile of wood to keep you warm throughout the winter, the question is are you chopping enough wood to survive?
Just as a furnace produces heat only if it’s full of wood your funnel produces revenue only if it has qualified leads that eventually close. Keep it full of enough qualified leads throughout the year and you achieve your quota.
The coming year is already here. Here are some strategies for keeping your sales funnel full and enjoying the fruits of that labor 12 months from now:
1) Manage to Target TVR. Measure the health of your funnel using TVR, Total Viable Revenue. TVR deals are only the deals that have reached a stage where the customer has committed to making a change or purchase. Working back from quota you can clearly define the Target TVR, that is how big you need your funnel to be. A $3M quota with a 50% win rate means your funnel needs to be $6M of TVR. As sales go up throughout the year the Target TVR goes down, but the key is to manage to the Target TVR, not to your quota gap.
2) Be selective in the opportunities you pursue. Nothing improves sales performance efficiency like purging the deals that take too much time to win and are not worth winning in the first place. Winning the right deals takes no more time than winning deals that are not a good fit or profitable.
3) Re-win the business you have at your best customers. Like the couples who renew their wedding vows after 40, 50, or 60 or more years go back to your current, best customers and show them how much you appreciate their business. Show them the love! This is an annuity that you cannot afford to take for granted.
4) Get into a Funnel Audit plan, do, check, adjust routine. There’s no better habit than one that commits you to a regular schedule of diagnosing your funnel and setting monthly action plans. Spotty diagnosis is a sure way for execution to suffer.
5) Every time you close a sale commit time to replacing it with 3-4 new opportunities. There’s no better time to add TVR to your funnel than after you have closed a sale. You’re feeling good, you can take the rejections, you’ve got energy. Get back out there and build funnel value now.