Between the Ears

Posted on September 22, 2011. Filed under: Funnel Audits, Lead Generation, Pipeline Measurement, Sales, Sales Funnel, Sales Goals, Sales Management, Sales pipeline, Sales Quota, sales training, Sales Velocity | Tags: , , , , , , , , , , , |

If you’re a VP of sales and you’re thinking about making an investment in sales process or methodology right now it’s probably a stressful decision.  For one it takes a lot of time to think through the possibilities of what could be valuable.  You want to select something that’s going to squarely hit the mark.  It takes a bit of political capital if you’re needing to get financial approval from your boss.  It’s stressful because you’re not 100% sure your team will embrace it or reject it.  Your credibility as a leader could take a hit.

There’s one question that you should ask yourself to help with the decision:   How will it improve how your sales people think, dialogue, plan, and execute around selling?

Take the funnel for instance.  It is still popular to assign percentages on funnel stages.   Early stage sales opportunities might get a 5% or 10% assigned number.  Opportunities that reach a proposal stage might get 50% and one that is in negotiation might get as much as 80% or 90%.  But when asked how these percentages help a salesperson sell the answers are usually weak.  They don’t promote dialogue.  They don’t foster coaching.  They don’t help set strategy.

Another example with the funnel is funnel value.  We call it TVR, Total Viable Revenue.  TVR is the sum of the dollar or euro values of each opportunity that has reached the Commit Funding stage of the customer’s buying process.

With TVR the seller and manager have a powerful piece of information to help the seller plan, organize and prioritize to maximize his or her productivity.  TVR is used with the Funnel Audit to determine a 30 day plan every 30 days for working the funnel.  But even some of my clients fall back into the habit of  cramming the night before the test, completing their Funnel Audit Worksheets the night before.  They’ve missed out on the power of the Audit as a planning and prioritizing process.  When used properly the Audit helps the seller think with structure about his situation, weigh alternatives, assess the best option, and define the plan.

Finally, another example of using information to help you think and strategize better is when a sales process reveals something important about the sale that you had not considered.  Let’s say you had made a few calls on a current customer and thought you had a pretty good idea of the stakeholders involved and their roles in the buying process.  But you assumed that someone in purchasing had the financial authority to commit funding based on past experience with the account.  In a strategy session with your sales manager she convinces you that your purchasing agent doesn’t have this power and you don’t know which stakeholder does.  Now what do you do?

You could do nothing different and proceed as planned.  Or you could meet with the purchasing agent and explore this topic of funding.  By raising the topic you would learn something at least, such as what else is being considered or timing.  But at best you might learn exactly who has that funding authority and even get advice on how to get a meeting with that person.

I haven’t made your decision easy but I hope you put all of your options through the test of how will they help me and my sales team think better, improve dialogue, and ultimately perform the job of selling more effectively.

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Qualify or Disqualify? That is the question.

Posted on March 16, 2011. Filed under: Funnel Audits, Lead Generation, Pipeline Measurement, Sales, Sales Funnel, Sales Management, Uncategorized | Tags: , , , |

I struck a chord with many of you last week when I blogged about the mindset of ‘qualify’ versus ‘disqualify’.  Therefore I have disqualified a few upcoming blog topics in favor of writing more about this comparison.

In my search I looked for clarity in the definitions of qualify and disqualify.  To qualify is ‘to become eligible to do something’.   To disqualify is ‘to debar from a competition because of an infringement of the rules’.  Unfortunately I don’t find either one to have a clear advantage in putting me in the proper mindset.

I don’t claim to be the first author or consultant to wave the disqualifying flag and I don’t claim to own it.  I went back through about 20 books on selling in my library to understand more credibly who is taking this angle and who is not.  I found the word  ‘qualify’ in about 90% of the books I reviewed.  Some of them had chapters devoted to the topic.  In two books the authors’ called it qualifying but their approach to qualifying suggested more of a disqualifying attitude.  This resonates with me.

For most part sellers have been raised in a ‘qualify’ house.  It could be that taking an explicitly disqualification approach rubs us the wrong way.  Salespeople tend to be hopeful and aggressive.  Disqualifying is skeptical or cautious.  We’re also cursed with the blessing of being stubborn.  We don’t want to think (or admit) that we can’t win that deal and we show our faith by pouring ourselves – and sometimes dragging others with us – into the pursuit.

Particularly determined sellers find it hard to take no for an answer.  They are convinced they can win even the ugliest, smelliest deals that most others would have rejected much earlier in the buying process.  The worst thing to happen is winning one RFP out of 29 you blindly responded to.  Like the once in a generation miracle you now have a victory that’s mounted in the bar of fame that proves that your determination pays off.

Your interpretation of what it means to ‘qualify’ is affected by the manager you work for and your company’s sales culture.  If the sales manager looks at your weak, at risk funnel and has a holy s— moment , he might scream that you’ve got to fill that funnel and fast!   When you do a Funnel Audit a month later and it’s loaded with new opportunities he says wow! That’s what I’m talking about.  But often the truth is that funnel is full of made up, ‘unqualified’ opportunities.

So does any of this really make a difference?  Am I making something out of nothing or is there value in adopting a disqualifying approach?  You tell me.  Take the poll, below.  I’ll continue the topic in the next post.

 

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Sales Velocity and the Funnel

Posted on February 2, 2011. Filed under: Funnel Audits, Lead Generation, Pipeline Measurement, Sales, Sales forecasting, Sales Funnel, Sales Goals, Sales Management, Sales Metrics, Sales pipeline, Sales Quota, sales training, Sales Velocity | Tags: , , , , , , , , , , , , , , |

One of my clients, a director of sales, gave me solicited input in a meeting I was preparing to facilitate for him and his colleagues and the VP of Sales last year.  This was an existing Funnel Principle client looking for ways to leverage the system they installed a few years earlier.  “Let’s make sure we talk about sales velocity”, he said.

“Absolutely”, I replied.  Then I asked, “If you had better or more information about sales velocity for your region funnel how would you use that information to manage better?”

He replied almost before I finished the question.  “I don’t know.  But it seems like I should know more about it.”

Metrics like sales velocity are valuable for many reasons.  Whether your company has a sophisticated system of metrics, or keeps metrics to a bare minimum, or has no metrics at all you all share a common need to make the information you gather meaningful to your troops.   Ultimately, their greatest value is the role they play in changing or reinforcing selling behavior.

Funnel value (we call it TVR, Total Viable Revenue) is probably the most common metric that I hear VPs of Sales say they want to have and provide for their salesforce.  I agree it’s a valuable metric but only if it’s acted upon.  I continue to see a gap in having that information and in driving change.  I see two reasons for this.  One is because the users don’t trust the data on their funnels.  Therefore, the funnel value has little credibility.  Two, there’s a lack of connection between funnel value and actions to run a territory.

TVR is a key leading indicator to the true health of a funnel.  It’s all the sales on the funnel that have reached a critical stage of the customer’s buying process called Commit Funding.  At this stage the customer has committed funding and possibly significant resources to making a change one way or another.

The best way to connect TVR to actions is to inspect the funnel regularly and use the information to plan, organize and execute.  Think ‘lean’ for a second.  If a rep’s TVR is in the red, the action plan has to include ways to get it to green.  These ways are tied to working specific accounts and opportunities at specific sections of the funnel, namely the non TVR sections.  These are the early stage opportunities.  You go there first to find more TVR.

An action plan to find more TVR if that’s what the diagnosis suggests is not a loose, airy, feel-good next step kind of thing.  It’s specific and therefore accountable.

It’s the sales manager’s job to help the seller define this plan and keep her accountable to it.

Ain’t rocket science.  But man it is powerful.

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The VP of Sales as Funnel Coach

Posted on January 27, 2011. Filed under: Funnel Audits, Sales forecasting, Sales Funnel, Sales Goals, Sales Management, Sales Metrics, Sales Quota, sales training, Sales Velocity | Tags: , , , , |

It’s not the will to win, but the will to prepare to win that makes the difference.  Paul Bryant

If you’re VP of sales with sales managers reporting to you how do you coach the funnel for your team?

First, it all starts with you.  If you think that better funnel process across your enterprise will make an important difference you’ve got to do more than write the check to the vendor.  I suggest you think of your mission here as creating a ‘funnel culture’, a term I introduced in my book The Funnel Principle.   At your level of the organization funnel coaching goes beyond your immediate circle of influence – your salesforce.  It crosses naturally into other functions that don’t directly report to you, like marketing, customer service, even manufacturing.  I’ve had three conversations this week alone with people asking how the funnel can help the plant know how much to build.

Creating and driving the culture includes things like this:

Lead by example with Funnel Audits.  If you expect your sales managers to conduct Audits (funnel inspection) every 30 days, you should be Auditing the sales managers with some frequency too.  Even if it’s every other month or even quarterly, this sends the right message to everyone about the importance of this part of the process.  I have a client that is still doing Audits 8 years after the initial roll out.

Offer training and more to the nonsales functions.  Karen,  a VP of North American Sales for a $1B healthcare company had me make a one hour presentation early in the implementation to people that worked in the plant and in other very non-sales type functions.  If there’s even one positive outcome from that short presentation it could easily have a financial benefit to her company.

Introduce the system to national or global accounts.  One of my clients had me design a funnel process to more efficiently coordinate national accounts efforts with the field salesforce.  We published the results of that effort in SAMA’s Velocity magazine.

Get IT to find ways to use technology, like CRM, to help the sellers be more efficient.  Mike Fox, the president and owner of a small HVAC company saw the value of this and had his IT department completely modify the company’s CRM system after we had defined the funnel process.  It’s one of the most efficient CRM funnel tools I’ve seen.

Integrate the funnel into existing business processes.  Mitch, a Worldwide VP of Sales and Applications for a high tech company devoted for one entire year 50% of his bi-weekly worldwide sales call to reinforcing the funnel process we rolled out to his global organization.  It was a tremendous display of leadership of sales process at the highest level.

Much of your role as funnel coach for the VP of Sales is about giving your team the tools it needs and finding ways to reinforce and drive the funnel as a business process.

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The One Time Trust Means Nothing in Sales

Posted on January 26, 2011. Filed under: Funnel Audits, Pipeline Measurement, Sales, Sales forecasting, Sales Funnel, Sales Goals, Sales Management, Sales Metrics, Sales pipeline, Sales Quota, sales training, Sales Velocity | Tags: , , , |

I learn teaching from teachers. I learn golf from golfers. I learn winning from coaches.

Harvey Penick

If you Google ‘challenging assumptions’ you’ll get a ton of hits related to six sigma and lean production.  You’ll also see a lot on the topic of creative problem solving.

The irony of both of these is that it’s tempting to believe that the creative or ‘applied’ approach to a task like setting a sales strategy takes longer than doing it the way you’ve always done it.  The traditional path is the path of least resistance because it’s familiar – but it’s sometimes just a slow ride on the wrong train taking you to the wrong destination.

Your role as sales manager to help sellers get the most from their funnels is to challenge assumptions for the deals they pursue and for the funnel they’re relying on to achieve quota.  What does challenging assumptions look like?  Let me give you an example.

I was coaching a Funnel Audit with a manager and his salesperson.  The salesperson described a deal as being at Stage 3 so the manager simply asked for ‘tangible evidence’.  This is part of our process and both manager and seller were trained in it.  The seller replied but didn’t give tangible evidence.  The manager asked the question again. The seller didn’t give tangible evidence again.  The manager asked a third time and the seller replied in frustration “you’re killing me!”  He then said “Trust me, it’s at Stage 3.”

I’m a big fan of trust.  But I’m an even bigger fan of verifiable trust.  Asking for tangible evidence is asking for verifiable trust that the sale is at stage 3.  Without it the seller is making assumptions.  You must challenge this every time.

How do you challenge assumptions?  There are multiple ways.  One way is to use a process that’s credible in the eyes of the seller.  It’s even better if the company has adopted this process across the enterprise.

With a process it’s less about you the manager and what you think and more about the process tells you.  The process allows you remain independent and unbiased.   With a process you don’t have to get creative with your response a hundred different times – just stick to the process in how you would reply and you’ll be repeatedly effective, on point.  This makes you more productive.

This approach will never fail to produce the information you and your sellers need to set effective sales strategy.  They might push back.  They will test you.  They’ll strike if they smell blood.  Do them a favor.  Hold your ground.  Challenge their assumptions.  And if they’re driving too fast don’t hesitate to shout slow down!

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Funnel Audits: Building a New Muscle Memory of Selling

Posted on March 12, 2010. Filed under: Funnel Audits, Pipeline Measurement, Sales Management | Tags: , , , , , |

One of the golden rules of selling is to understand needs before you pitch solutions.  It’s similar to what Steven Covey drilled into us with his Seven Habits book, ‘seek first to understand, then be understood.
While Covey’s advice is aimed at understanding people, we can apply it to managing your sales funnel throughout the year.  Over a 365 day period you’ve got to regularly seek to understand your funnel’s condition, then set action plans to accomplish your goals.

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