I’ve come to learn that Bob Terson is a classic. So is his book Selling Fearlessly.
From the title, so innocently cutting to the core of why some sellers never reach their peak.
To the dedication that is explained in his introduction, that tells you Bob understands respect and loyalty.
To Bob’s favorite book on selling, a 1947 work that shaped him to be the salesperson he has become.
I can honestly say I’ve never read a book on selling like Selling Fearlessly and I’ve not been moved more by any book on selling I’ve ever read.
Why should you read Selling Fearlessly?
To be inspired.
Bob is a master story teller. If you have to know why this is inspiring you haven’t heard a good sermon or homily lately and that’s too bad. He tells stories about winning over Donald Trump, never losing faith (The Mound Road Story), not being intimidated (Captain Bly), being memorable (Make Sure the Customer Remembers You), and many, many more.
To be educated.
Bob offers plenty of advice that can make you better or help you stay on top of your sales game. And because the game of selling is changing that’s pretty important.
To be moved to take action.
He reminds you that while you need to keep your eyes and ears open to witness the lessons before you life isn’t a spectator sport. My favorite line of the entire book: A salesperson is the engineer of commerce. Until he takes action nothing happens.
There is one downfall of Bob’s book. It’s such an easy, enjoyable read that before you know it you will have reached the last page.Read Full Post | Make a Comment ( None so far )
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.Read Full Post | Make a Comment ( 3 so far )
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.Read Full Post | Make a Comment ( None so far )
Stop swinging at bad pitches
Otherwise known as learn to qualify better.
Qualification has always been an important skill for sellers. Now the stakes are even higher. For many sellers there are fewer opportunities to chase than before when the economy was booming and sellers mainly took orders. The more time sellers spend on leads that will go nowhere is less time available to chase leads that could become sales.
Our clients have learned to improve qualification by understanding it from the customer’s perspective. From the customer’s perspective they go through a series of three significant stages in the buying process. Our BuyCycle Funnel™ gives sellers the guide to get inside this customer perspective. The seller is more productive – he loses faster, he avoids overcommitting, and he avoids overestimating the value of his or her sales funnel.
The first stage of qualification (Stage 1) is Problem Recognition. The customer needs to express an issue, a need, an opportunity or a problem clearly enough that the seller knows he or she can solve the problem.
The key to Stage 1 qualification is knowing how much the customer knows about the problem. Vague comments about wanting to ‘reduce costs’ and ‘get better’ have to be explored and challenged. For a software client of mine the seller might learn from a CIO that his medical supply company is spending too much time tracking certain assets once they leave the warehouse. The CIO might say “we’d like to improve our efficiency.” Has the CIO or his staff spent time understanding this problem? What do they know about it?
The software rep needs to challenge the CIO’s intent to act now. He could reply “Do you have a target performance goal for improving efficiency this year? Or, “Where are you seeing the inefficiency the most? A vague reply could indicate lack of a commitment to take action. It can also be your opening to suggest that the stakeholder be more aware of the real consequences at play.
The second stage of qualification (Stage 2) is Defining Economic Consequence. In this stage the customer is deciding how costly the problem is or could become if it doesn’t change. It’s largely a dollars and cents kind of assessment. Problems that cause enough economic distress or anxiety for key stakeholders are more likely to be acted on. The software rep might ask these questions:
- Is the efficiency problem costing you money that you’re aware of?
- Does it threaten any key customer relationships? Could it if the problem worsens?
- Is it a top 3 problem? Have you reached a point where you can’t afford to run your business this way?
- Do you know how it affects other parts of the business?
- What’s at stake for you if this issue doesn’t get addressed?
If the economic consequence or impact is not great enough and if the anxiety isn’t high enough then the stakeholder continues to live with the problem.
Knowing what type of stakeholder you’re talking to is important. If the PFA is ambivalent there will be no change. If the stakeholder isn’t a PFA he could be pulling his hair out with frustration but will have to live with the problem.
The third stage of qualification (Stage 3) is Commit Funding. Here the PFA has committed funding or significant resources to fix the problem. The PFA is expressly saying “we choose to no longer live with the problem.”
Yeah this is big deal when the PFA commits! It’s almost as big as signing on the line that is dotted. The key here is to be sure you’re hearing correctly that funding has been committed. You can hear it directly from the PFA or from a highly reliable source that knows this has happened.
Don’t complicate your selling. It’s already tough enough. Stick to these fundamentals as you evaluate how qualified your funnel of opportunities is.
Looks like we’ve got a base hit! See you next time for our third and final tip in the series.Read Full Post | Make a Comment ( None so far )
Despite what the Dramatics said in their 1971 hit, when it comes to the sales funnel what you see (what you see) isn’t always what you get (what you get). Oooh!
Weekly I hear from sales leaders – sales managers, sales veeps, national account managers, presidents and CEOs and others – that they don’t trust what they see in the funnel. One manager joked that his 50% confidence in the funnel wasn’t a problem. The problem is in not knowing which 50% he could trust.
So thanks to CRM we don’t have a visibility problem anymore with the sales funnel. We have a funnel insight problem.
Some sales executives have become more than just convinced that funnel visibility is good – they’ve forgotten or consciously overlooked the real health of the funnel. Visibility is valuable only if what they’re looking at is real. CRM is not the culprit, but it is the vehicle that is carrying this germ from host to host. I’ve blogged and tweeted that when it comes to the sales funnel you can’t use a technology solution (CRM) to solve a process problem (the funnel). But technology solutions to the funnel – CRM – are alive, well, and well funded. Unfortunately they’re taking many salesforces down the wrong road to Grandma’s house. The Big Bad Wolf is having a field day.
I think that the speed of business these days and the time demands on sales people and their managers has made it harder for these stakeholders to have the kind of regular deal dialogue that drives out bad funnel data. It’s tempting to run the report and go with the info that’s there. Resourceful managers have created work arounds to deal with a process that is loaded with mistakes.
I’ll go so far as saying that the tool of CRM does not provide insight into the health of the funnel. What gives funnel insight is having a funnel process.
It’s simple to understand, but man it’s hard to pull it off. It’s a regular inspection of the funnel, in a structured way that consistently reveals the most important information about the funnel. This conversation has to be consistent because as it travels up the food chain from rep to manager to director to VP Sales to president it’s easy for things to get misinterpreted.
How is it that companies can have invested thousands, maybe millions, in complex CRM and still not have a high level of confidence in the funnel data that’s on the reports? How can half of the 625 firms surveyed by CSO Insights in its Sales Management Optimization Study report that they have at best a random process for managing the funnel? I know these companies. I’ve talked with their CSOs.
You know the cost of bad funnel data. Lots of time spent pursuing one strategy when another one would have been more effective. Lots of time spent by managers trying to interpret each rep’s funnel instead of coaching consistently to a process. Lack of funnel process allows ‘crap creep’ as one of my clients calls it.
You can do a spring cleaning and purge what shouldn’t be there. Think ‘garage sale’ to trash and pass on to others the stuff you no longer want. But that garage will get cluttered again if you don’t have a way to prevent it.
We need to stop confusing funnel visibility with funnel insight. Visibility is so sales 1.0. Insight is the name of the game today. A funnel process ensures high integrity of funnel data – valuable, trustworthy information for the stakeholders whose quotas depend on it.Read Full Post | Make a Comment ( None so far )
Is there a difference between ‘qualifying’ and ‘disqualifying’ and if so is it meaningful and relevant? Let’s see what one difference looks like.
A few months ago I had a sales call with a high level sales leader. He found us on the web, checked out our blog, the videos, white papers and more. After about 5 minutes of talking with him I concluded he didn’t need me to convince him of what he was already convinced of. So I shifted my focus to the next hurdle – making change happen in his company.
If I was trying to qualify the opportunity I might ask this question:
“Who else do you think we need to talk to in your company to understand the needs better?”
This question probably gives me names of sales managers reporting to this VP of sales and maybe someone outside of the sales function like marketing. It is helpful. A follow up question might ask about the needs of these other stakeholders and even their level of influence.
“Who’s opinion do you particularly look for in this situation and why?”
On the other hand if I take a disqualifying approach my questions might look like this:
“I appreciate your need to increase sales and have better insight into the sales funnel. But people and teams can often resist change. Why would your team embrace the idea of changing its selling process right now?”
I like this question because it’s the question this VP of Sales needs to ask next. He has to sell his team on the need to do this. In doing so he might offend a stakeholder who had a hand in the current process or in no process at all. He might be seen as causing upheaval to other stakeholders. How about this as a disqualifying question:
“You know these initiatives take energy and resolve. Why would you want to take this on right now?”
Another follow up disqualifying question might be:
“I’m sure there’s one or even more people on your team that might have more skepticism about embracing change now. How do you plan to deal with them?”
Again, it puts his obstacles front and center.
Do you worry that this style reveals things that you’d rather not be revealed? I think you’re not giving these people enough credit. They’ve been down this change road before. More likely they’ll be impressed that you can relate to their challenge.
I shifted my questioning to money and funding.
A qualifying question about funding might sound like this:
“Do you have money in the budget for hiring someone like our company?”
A disqualifying type question about funding might look like this:
“You probably don’t have a line item in your budget for ‘implementing a sales funnel business process’. If you had to ask for approval to spend $100,000 how would you defend that?”
“If you found $100,000 for this program would another program be sacrificed? How would that go over?”
Even if this person is the one with financial authority for this spend he or she still has to sell it. You’ve now invited the dialogue to be more about things this stakeholder will have to begin addressing sooner rather than later. Selling change. You’re in a position to help him or her build the business case to do so.
If this stakeholder balks at any of these suggestions you know he’s probably not as far along as you hoped. You also know that this sale isn’t moving any time soon. These issues of finding funding, building a business case, assessing the strategy for making change happen are what’s next in the buying process.
These questions might be subtle but I think they’re subtly significant. Let’s put the burden of proof onto the stakeholders we’re calling on to show us that they have incentive and energy to sponsor change.
- Stop Qualifying and Start Disqualifying Part 2 (funnelprinciple.com)
- Stop Qualifying, Start Disqualifying (funnelprinciple.com)
Every seller has been told, trained, coached and coddled to qualify his sales opportunities. The better you are at qualification the more productive you’ll be.
The past several years I’ve seen a few books and sales methods that recommend ‘getting to no‘, ‘starting with no’, or just ‘saying no.’ No kidding.
I like this theme in general because in a different, potentially very effective way it reminds us to do things that make us productive when we sell. Things like qualifying effectively, doing discovery, getting to the right stakeholders, and getting commitment throughout the buying process.
Adopting an attitude of ‘no’ is like adopting an attitude of disqualifying sales opportunities instead of qualifying.
For example if you call on a stakeholder who has a problem but no authority to change and you don’t uncover this lack of authority you risk spending way too much time on this person. Repeated calls back to this person might feel like you’re making progress but structurally it’s simple. You’re not. You’re doing a poor job of qualifying. Qualifying questions for me in my business might take the following form:
“So tell me, what is it about your sales funnel process that you’re not satisfied with?”
“It’s affecting your forecasting accuracy you say? How far off are your forecasts typically?”
“Have any of your sales managers mentioned how much time it takes them to do funnel inspections?”
If I hear what I hope to hear I’m tempted to walk away thinking I’ve got a qualified opportunity. I’ll get some valuable information but if I stop here I could be wrong. If I take a disqualifying approach I walk into the call prepared to ask questions that challenge the stakeholder to tell me why they would take the time and energy to act on these needs. These disqualifying questions are looking beyond need to incentive and motivation to change.
Most VPs of Sales will agree or admit that their sales process isn’t 100% satisfying and delivering desired results. There’s always room to improve. But for me to sell the VP the VP has to have energy and motivation to change.
My ‘disqualifying’ type questions might uncover that if they look like this:
“I appreciate you telling me that your forecasting isn’t as accurate as it needs to be. But you said it’s been like this for as a while. What’s the incentive to do something about it now?”
“You said you expect a record year of sales this year. Congratulations. May I ask, what’s the business case for making changes now to your sales process?” Wouldn’t you be concerned that making changes now could jeopardize a good thing?
Let’s say I’m meeting with the stakeholder who has a problem but no authority. Here’s a disqualifying question I might ask:
“I appreciate that you’re having some issues that you’d like resolved. Who else in the company would have to be sold on taking the time and possibly money to fix these issues?
“How would you go about selling these people on a need to change?”
“What incentive would they have to change right now?”
These questions might be subtle but I think they’re subtly significant. Let’s put the burden of proof onto the stakeholders we’re calling on to show us that they have incentive and energy to sponsor change.Read Full Post | Make a Comment ( None so far )
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.
- 3 Important Sales Funnel Metrics (funnelprinciple.com)
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.
- For all the Warrior Sales Managers out there… (funnelprinciple.com)
- The One Time Trust Means Nothing in Sales (funnelprinciple.com)
- Use Your Sales Funnel to Drive Deal Reviews (funnelprinciple.com)