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When asked why he robbed banks, the infamous Willie Sutton answered, “Because that’s where the money is.” The question Willie Sutton didn’t answer, however, was probably even more important: How did he choose the best banks to rob?
While most sales metrics focus on final results, additional productivity can come from looking at the original sources of opportunities in your pipeline. Of course, it is often tempting to fall back on sales lore about cold calling ratios and complain that marketing never delivers enough leads. In this brief, we will focus on a better approach, including how to pinpoint the day-to-day sources and activities that work for your team and in your market.
THE HOW, NOT JUST THE WHAT
As we discussed in the brief “The Measuring Sticks of Sales Productivity,” looking at numbers alone measures sales, not an organization’s actual ability to sell. In the brief “Optimizing Sales Performance: Driving the Herd,” we talked about how accountability demands visibility, not only in the traditional sense of results and cost, but also for predicting future revenue. A simple first step toward understanding “the how” is to find out more about the opportunities making it into your pipeline that become closed deals.
Based on SiriusDecisions benchmarks, best-in-class marketing organizations will contribute between 18 percent and 33 percent of demand in the sales pipeline. That means in a best-case scenario, your reps are supplying roughly 67 percent of their own demand. To make the time spent on delivering that 70 percent more effective, sales managers and sales operations can look at two information sources: one is internal data on closed deals, while the other is interviews of reps exceeding plan. Once you learn how your best performers find new opportunities, you can train others to replicate that behavior faster; you can also make your best reps more effective by comparing internal metrics to external benchmarks and best practices.
START WITH CLOSED DEALS
To define the best sources of opportunity, first get some basic information together about your sales process. Note that the numbers do not have to be perfect to get started, and sales operations may already have some of what you need. Begin with your average selling price (ASP). What is it, and how broad is the range that combines to create the average? Do you sell most deals of the same size, or a combination of larger and smaller deals? Other data to uncover include whether different reps have success with different deal sizes; any business seasonality; average sales cycle length; and marketing contribution average. By determining this last piece of data, you will know what share your reps need to source on average, the basis for the level of investment required to help them.
Next, dig into the sources behind your closed deals. Some organizations capture this information from the time an opportunity appears and track it through to close. Others rely on sales reps to enter this information if and when they wish. If you do not collect this data today, consider adding a field based on input you get from reps so you start to build knowledge over time. Offer a pick list as a field in your sales force automation (SFA) system, with sources your salespeople are likely to use and then require it to be completed.
Reporting on closed deals gives you clues as to where opportunity is found. Your next goal is to uncover the “unconscious competencies” that lead to success in your environment, as opposed to relying exclusively on external best practices that will not take into account what is unique about your organization workplace and the people in it. External benchmarks will
become more meaningful for you after you have established an internal baseline so you can contrast the two and look for opportunities to improve.
ASK WHERE THE MONEY IS
Based on the numbers, you will know who you want to interview and what you want in your pipeline, and you might have an idea of the sources that lead to those revenue-generating closed deals as reported in your system. Talking to your best reps rather than looking just at closed deals means you will avoid the “even a blind squirrel finds an acorn once in a while” distraction of closed deals from less predictable reps. You are looking for information on what sources and tactics deliver closed deals for your reps on a repeatable basis.
Ask your high-performing reps about their current pipeline and closed business to find out the origin of those opportunities and what it took to find them. Common sources should start with marketing, through programs that generated pre-qualified leads that were then further qualified by teleprospecting. Other macro categories include inbound (referrals or channel partnerships); networks (personal, professional, social); association memberships; and published leads (government bids, building permits, regulatory reporting).
ASK HOW THEY “ROB THE BANK”
Once you have uncovered where the names come from, next ask about the steps they take to uncover an opportunity. Interview subjects can include:
• Selection criteria. For incoming leads/names, does the salesperson make any value judgments based on demographic criteria, both for the individual as well as the organization? He or she may prioritize a certain group of prospects and/or pursue them more aggressively, pushing others down the list to be contacted later (if at all) and less doggedly. Of specific interest to marketing leadership is whether these answers match the target markets they are chasing after, both from an individual and corporate perspective. If their planned target marketing doesn’t match what sales finds to be reality in terms of conversion to deals, upstream changes need to be made immediately.
• Tactics. Does the salesperson make a telephone call to the prospect first? Seed the ground with an email or a personal letter? Take some other tack that hasn’t previously been noticed and cap
tured by the organization? By honing in on tactics that work, sales and marketing can work together to build templates, tools and training that allow other reps to replicate these approaches.
• Messages. What messages are your best reps finding work the best for prospects within target markets? Do these messages match those that are being communicated in the tools/collateral they are being provided by marketing? Have there been major changes over the past 12 months in specific markets where messages that once resonated are now failing to meet the needs of prospects? The answers here will help both your sales readiness as well as marketing functions re-evaluate their approaches using reality-based field feedback.
• Deliverables. What are the specific pieces of collateral that the rep shares with a prospect that seem to resonate the best? This could include specific sell sheets, case studies, templates and tools; you will often find that with deliverables, the old 80/20 rule applies; good reps have significantly whittled down the wide range of deliverables offered to them by marketing.
Beware: You may find that asking reps about where and how they find their best opportunities is harder than asking a pirate where he hides the gold, as they may consider this information a hard-won competitive advantage. If getting information from some reps proves difficult, try approaching it from the angle of helping to justify the investment to get them tools they could use to become even more effective. If you don’t know what they need, you can’t help them.
Knowing the specific sources and tactics that spell success in your environment will give you greater visibility into your pipeline, as well as a way to help reps optimize their performance. Start by identifying those whose behavior you want to understand and whose performance you want others to emulate, then ask them where and how they find the opportunities that lead to closed business. Once you know these sources, you can define the competency areas (sales process, sales skills, sales knowledge and sales tools) that will help others to focus on the sources and methods that are most effective. With this information, you can begin to measure the quality of a rep’s pipeline based on what you know to be achievable and effective, and help them stay away from what is not.
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