Pipeline Management is fundamentally, a time management problem. It begins with answering the following questions.
- Are there alternatives to a sales person spending the majority of their time doing demand fulfillment tasks?
- How much time should be spent on maintenance accounts?
- How much time should be spent on prospecting?
- Do you have a plan for account qualification?
- What is your company’s value proposition?
- What is your competitive advantage?
- Do you have a penetration strategy?
Start with Balance
Here’s what should happen….there should be a balance in every field sales person’s territory between prospecting, account maintenance and penetration. Now let’s define the differences.
The pipeline"Prospecting is essentially trying to find an opportunity where you have no sales activity and it may or may not have potential so there’s a constant churning. You don’t know the real potential until the account has gone through a qualification procedure. This is simply a process of questioning that helps determine what the customer is buying and how much of what they buy fits your line card. Qualifying a customer can be done by both inside and outside sales. What you’re trying to do with prospecting is look at the movement and buying influences in your industry. Cold calling is the most unproductive activity a sales person can undertake. Therefore, it is highly recommended that you develop an inside sales support program for qualification of prospects.
Account Maintenance is the services you provide to major accounts where you have received maximum share of spend. Literally, this means there is little or no potential for increasing your sales at this account because they already buy everything they could possibly buy from you. Congratulations, you have done an excellent job at that account. Your primary objective at that account is to protect your position and keep the customer happy. Usually, most sales people have but one or two accounts of this nature.
Account maintenance and Prospecting are the book ends of territory pipeline management. However, real growth opportunity, opportunity that has the largest rate of success, is the penetration of existing accounts that have a significant potential for an increased share of the customers spend.
An opportunity exists for a significant increase in sales in the next 90 days. – This is important.-- A significant increase in sales in the next 90 days. - This kind of opportunity will only exist at accounts that you are currently doing business with and you have developed relationship equity at these accounts. In other words, they know you; they trust you and they believe in your company and your products. You just haven’t been able to get the maximum share of their purchasing dollars ---- yet. Notice I used the term, yet. There are several steps involved in creating a strategy to increase your penetration at these accounts with high growth potential. They include:
• Make sure you have the "Book" on the customer. You have a complete profile on the customer and their business
• You have multiple contacts within their organization
• You know your competitions strengths and weaknesses
• Determine real growth potential
• You have defined value propositions that match customers needs
Once you accumulated this knowledge, utilize it. Develop your penetration strategy around the customer’s pains. What challenges do they face on a day to day basis? How do they make money? Where can you provide value, increase their ability to make profit. (This does not include price reductions). Employ all the resources in your company that are necessary to accomplish your growth objectives.
A key best practice principle utilized to manage your territory and maximize success states that you should allocate time by opportunity for increase rather than existing volume. Think about that. It makes a huge difference. Most salespeople allocate their time based on the account size and what it takes to service them. That worked in the 80’s. It’s was a lone wolf concept. Back then we all thought we personally owned every customer. It was only about relationships. Times have changed.
Pay Attention to How You Invest Your Time
Return on Investment from a sales person’s point of view (Return on Time Invested) is critical to territory success. Don’t let the high revenue dollars from your large accounts cloud your vision on potential growth. If you have already captured the majority of spend from your top accounts and there is little room for growth ---- they are "Maintenance Accounts". That doesn’t mean you stop calling on them. You can’t, they are considered the heart of your territory performance. But ask yourself if you need to spend as much time as you are spending on them. Better yet, ask them. You might be surprised to find out that it isn’t necessary to call on them as frequently as you do. There are only so many hours in the day and to manage your territory effectively you have to create time for growth. That growth is predominantly going to come from under penetrated existing accounts and new account development. It will not come from accounts where you are already getting the majority of their spend. Remember ….. managing your pipeline is critical to your success.