A Tale of 3 Squirrels and Their Human Counterparts in Sales

Posted by Dave Kurlan on Mon, Oct 28, 2019 @ 11:10 AM

squirrels2

It was rainy and cool so the leaves are dropping from the trees, the peak color has passed and it's time to focus on something else.

Speaking of focus, this morning I was watching 3 squirrels each doing their thing.

Squirrel #1, who I named Ernest, was finding lots of nuts and burying them.  His nest was full and he will reap the benefits of his hard work over the winter.

Squirrels #2 and #3, who I named MT and LayZ, were playing.  They were running up and down tree trunks, jumping from limb to limb, running in circles and generally chasing their tails.  They don't yet have nests and unless they make a commitment, become disciplined, and get to work, they will starve to death this winter.

Ernest, MT and LayZ are no different than their human counterparts who find themselves in sales roles.  The top salespeople are like Ernest and the bottom salespeople are like MT and LayZ.  For evidence of that claim, take a look at the table below with a sprinkling of data from Objective Management Group (OMG) which has evaluated 1,910,915 salespeople from  companies.

squirrels

Ernest would be an Elite salesperson.  Elites make up the top 5% of all salespeople.  MT and LayZ would be weak salespeople who make up the bottom 50% of all salespeople. As you can see from the 6 findings I included in the table, elite salespeople like Ernest are 208% stronger than weak salespeople like MT and LayZ.

The 2 findings most consistent with Ernest's focus and discipline are Commitment and Prospects Consistently, where Ernest is 92% and 82% stronger than MT and LayZ.

Even more importantly, Ernest is 326% stronger in the Hunter Competency.  The Hunter, and Commitment to Sales Success, are two of the 21 Sales Core Competencies that OMG measures. The other four findings listed above are all attributes of the Hunter Competency.

No matter how much selling evolves and how many complimentary selling tools become available, one thing will always remain constant.  B2B sales requires a full pipeline and a pipeline that yields results is built from a consistent prospecting effort, born from commitment and discipline.

With or without leads, a BDR team, or outsourced appointment setting, it is a salesperson's responsibility to be sure that the pipeline always has the 3 F's:

  1. Full (consistent daily effort to keep the pipeline full)
  2. Filled (qualified opportunities in the pipeline, lesser ones out)
  3. Fluid (opportunities in, opportunities moving and opportunities closed or archived)

Most salespeople don't even know the threshold for a full pipeline.  It's the number of opportunities required to sell one multiplied by the number that must be closed.  It doesn't matter if it's one account, one order, or one contract as long as the same definition is applied universally throughout the pipeline.  Additionally, the number required to sell one is not the number of proposals required to sell one.  It's more like this (if you close 33% of your proposals):

  • Closed: 1
  • Proposals Required (Closable): 3
  • Qualified Opportunities: 4
  • Opportunities with Compelling Reasons to Buy (Prospects): 6
  • New Opportunities (Suspects): 8

You can see that the typical pipeline requires 21, not 3 opportunities to sell 1, .

Don't be MT or LayZ.  Be Ernest with your pipeline building efforts.

Share your comments in the LinkedIn discussion for this article.

Images Copyright iStock Photos MT and LayZ, and Ernest

Topics: Dave Kurlan, closing, sales pipeline, prospecting, sales tips, discipline

What is the Sales Stack and Do You Need it?

Posted by Dave Kurlan on Tue, Oct 01, 2019 @ 20:10 PM

sales-stack-1

You bought a really nice, new, laptop computer and you thought to yourself, "Now I'm all set!"  But are you?  You needed a case to carry it around, a thumb drive for quickly moving files from your laptop to another, and a printer and if you have a Mac notebook, a port that will serve as adapters to your various cables.  These are your accessories.

You'll also need cloud storage, a broadband connection, email, a browser and 20 or so software applications so your computer can help you do the things you purchased it to do.  This is your technology stack.

But now there is a sales stack too.  What is the sales stack, and should you have one for your salespeople?

The sales stack consists of CRM, gamification, lead engagement, pricing and configuration, proposal generation, e-signature, content sharing, video conferencing, video production, video server, broadcast email, social selling tools, calendar scheduling, sales compensation, and more.  These tools, along with sales and sales management training and coaching, keep sales enablement folks busy.

And therein lies the problem.

You don't need all of these tools!  They are a distraction.  They create busy work.  They take time to learn and integrate.  Very few of them actually help you sell.  But you are told by the people that develop them that you must have these tools.  And you are told by sales enablement folks that you will be getting these tools.  After all, if you are the VP of sales enablement and you don't keep the flow of tools, applications, integration, training and implementation of these tools coming, there isn't much of a need for you to be there.  In order to justify your existence, you "keep 'em coming!"  Sales Enablement is the sales stack's best friend.

The question is, if we didn't have a sales enablement function, how many of these tools would we acquire based on the following criteria?

  • They help salespeople follow their sales process
  • They help salespeople stay organized in their efforts to close business
  • They provide sales leadership with important, realtime data
  • They provide insight and visualization into the sales pipeline
  • They give salespeople more time to sell and less time doing paperwork
  • They make salespeople more efficient

You would have CRM, but it probably wouldn't be Salesforce.com.  If you have a complex sale or a 1 month or longer sales cycle I would advise you to choose Membrain.

You would have an e-signature application to streamline getting your agreements signed.  I like AdobeSign.

If your salespeople aren't in the field or in a territory you would probably have video conferencing.  I like Zoom.

To avoid sending emails back and forth you would have a calendar scheduling application.  I like Youcanbook.me

If you run a company or lead the sales organization, those 4 tools would help your salespeople be more efficient, more effective and more focused.  Add anything else to that "stack" and you are taking away efficiency and effectiveness.

The stack won't sell for you.  The stack won't make your salespeople better.  You don't want the stack for the sake of having the stack.

That's my story and I'm "stacking" to it.  Leave your comments in the LinkedIn discussion for this article.

Image copyright iStock Photos

Topics: Dave Kurlan, sales pipeline, crm, sales effectiveness, sales stack

The Bearded Lady, My Shaving Pattern and Your Sales Pipeline

Posted by Dave Kurlan on Thu, Aug 08, 2019 @ 06:08 AM

bearded-lady

I can grow a pretty decent five o'clock shadow  - above my upper lip and only after about a week.  Unlike the bearded lady at the circus, when it comes to facial hair, there's really not much there!

Can you think of something else which, at first glance, appears to be OK but upon closer inspection, there's really not much there?

Did you guess sales pipelines?

As I wrote about a month ago, 46% of salespeople fail to maintain a full pipeline but most salespeople don't even know how many opportunities must be in the pipeline for it to be full.  

46% is very similar to the percentage of reps that make their quota each year.  Coincidence?

This is really a hunting issue and as I wrote in last month's article, only 33% of all salespeople have hunting as a strength.

So what are hunting-averse salespeople to do?

Cold emails don't work very well.  Want proof?  I get at least a half-dozen cold emails each day just from companies trying to sell a service to book meetings by using email, LinkedIn and Twitter.  I delete those emails.

Cold calls still work the way they always did but not until you reach a decision maker.  Most salespeople give up after four attempts but today it takes between six and fifteen attempts to actually get through.

Outsourced and semi-automated cold calls work if you outsource them to a company that's good at it - like ConnectAndSell - who also offers automated dialing.  They dial multiple names on your list at the same time until someone answers and then the salesperson takes over the call.

An inside team of Sales Development reps can book meetings if you're willing to make the investment and settle for the underwhelming results.  They might be able to average 1.5 meetings booked per week. If they do it on their own, salespeople should be two to three times better.  Of course, if you already have a flow of inbound leads, SDR's can follow up on those leads as they come in.  Immediate follow up has a significantly better chance of converting.  For most salespeople, even with the aid of an SDR-scheduled meeting, the pipeline isn't full.  They need to supplement - but probably aren't doing that.

Woody Allen said that 80% of success is showing up.  While good messaging beats lack of messaging, showing up wins the day over those who hide.

That applies to cold calls.  There aren't many salespeople who are good at making cold calls but those who are committed to making them, are disciplined about it, and call until they reach their targets, succeed because they did what most salespeople won't do.  Here are some good reasons to get back into the habit of picking up the phone, punching in a number and pressing send:

  • Your competition is not making calls
  • You can control how many prospects you dial
  • You can control how many conversations you have
  • You won't have to compete for eyeballs like you do with email or social  media
  • You can get your prospect engaged on a phone conversation
  • You can close for an appointment if you get them engaged
  • You can quickly build a strong pipeline just by showing up (on the phone)

You will crush:

  • Your quota
  • Your best earnings year
  • Your colleagues
  • Your competition

Just pick up the phone and start dialing it!

Image Copyright iStock Photos

Topics: Dave Kurlan, sales pipeline, hunting, sales prospecting, booking meetings

How to Transform Your Sales Pipeline Today

Posted by Dave Kurlan on Mon, Jul 08, 2019 @ 06:07 AM

pipeline2

Big ones, little ones, sharp ones and stubborn ones. I was pulling weeds from the garden when it became crystal clear to me.  The various weeds were like the many types of opportunities in most sales pipelines.  Big ones, little ones, those that hurt (we're behind the competition) and those who are stubborn (they aren't sharing important information).  The flowers in the garden are allowed to remain and are nurtured with sun, water and plant food. Similarly, we must leave and nurture the opportunities that will grow and produce sales, and weed out the undesirable opportunities that distract us from what is most important.

Flower gardens can be large, colorful, impressive and calming to look at.  Unfortunately, most sales pipelines are full of weeds, not large enough, and certainly not impressive.  From its evaluations and assessments of 1,875,978 salespeople, Objective Management Group (OMG) has found that only 46% of all salespeople maintain a full pipeline.  It breaks down as follows:

Elite  (the top 5%) 76%
Strong 65%
Serviceable 57% 
Weak (the bottom 50%)  41%

And when it comes to full pipelines, we must ask, full of what?  Generally undesirable opportunities.

Why do those undesirable opportunities remain in the pipeline?  They provide salespeople with a sense of security. Unfortunately, what they perceive as a safety net, is really denial of the reality of their pipeline.

Step one in transforming your sales pipeline is to perform a thorough weeding, which leaves you with a smaller pipeline, but with the same number of quality opportunities.  This is where a well-built, predictive scorecard will help.

Step two is to determine how many opportunities must be in your pipeline at all times.  To find the answer to that question you must know the size of your average sale or account, your closing percentage, and monthly sales goal.  Let's assume the following three metrics:

  • Monthly sales goal of $100,000,
  • 25% Closing percentage
  • $20,000 Average sale or account

With those numbers, you must have 20 opportunities worth $400,000 in your pipeline at all times in order to close 5 of them each month.  Complete the same exercise using your own historical numbers.

Step three is to determine the gap between what you need and what you have.  Using the example above, let's say you actually have 4 good opportunities worth a total of $80,000.  Your gap is 16 opportunities worth $320,000 - just for this month!

Step four is to add 16 new opportunities.  How?  Referrals, introductions, inbound leads, cold calls, whatever it takes.  But do it!  Today!  Now!  Referring back to OMG's findings again, only 40% of all salespeople are strong at Hunting.  That breaks down as:

Elite (the top 5%): 88% 
Strong: 77% 
Serviceable: 58% 
Weak (the bottom 50%): 26%

When it comes to generating referrals and introductions, only 35% of all salespeople are strong.  It breaks down as:

Elite (the top 5%): 48%
Strong: 42%
Serviceable: 39%
Weak (the bottom 50%): 32%

[Update - I was asked whether weak Sales DNA is responsible when a strong rep is weak at getting referrals and introductions.  It turns out that for 97% of strong reps, it's not Sales DNA but for weak reps Sales DNA is responsible 97% of the time.]

And as for making cold calls, only 33% of all salespeople prospect consistently.  It breaks down as:

Elite (the top 5%): 70%
Strong: 54%
Serviceable: 43%
Weak (the bottom 50%): 25%

If from among the bottom half of all salespeople, 50% of them won't make cold calls, 64% won't generate referrals and introductions, and 82% won't fill their pipelines, then nearly half of your salespeople may not do much of what was laid out in this article.

But there is hope for the serviceable, strong and elite salespeople - the other half.  Many of them will be able to do most of this but the key is holding them accountable.  Their sales managers must set expectations, designate this as non-optional work, impose a deadline, and enforce penalties for non-compliance. 

These four steps are not a one-time fix; they are requirements for continued success in sales that continue into perpetuity. 

Comments?  Questions?  Leave them on the LinkedIn discussion of this article.

Image Copyright iStock Photos

Topics: sales assessment, Dave Kurlan, closing, sales pipeline, prospecting, objective management group

Speed Limits, the Flow of Traffic, and Sales Pipelines

Posted by Dave Kurlan on Mon, Nov 19, 2018 @ 05:11 AM

speed-limit

I don't get stressed anymore when I'm driving.  All it took was for me to not exceed the speed limit.  I'm not sure whether it was my navigation system repeatedly telling me to "obey all traffic laws" each time I started the car, or my wife reminding me that I needed to be a good role model for our soon-to-be driving 16 year-old son.  I admit that this was much easier for me to do after I gave up my Jaguar for a Lincoln Navigator.  It holds much more baseball equipment!

There is an exception to not exceeding the speed limit.  When the flow of traffic in all lanes is moving exponentially faster than you are, you must increase your speed to match the flow of traffic or risk getting run over!

That brings me to pipeline flow.

I was doing a top/bottom analysis of a sales force where we look at their top 5 producers and their bottom 5 performers and from among 180 findings and scores, identify the differences between the tops and bottoms. We usually find between 15-20 significant differentiators but for this particular sales force I wasn't finding much.  Until I came to the pipeline.  Their top producers prospected consistently, successfully scheduled new meetings, and had full pipelines.  They were also rejection proof, didn't procrastinate, and didn't need prospects to like them.  In other words, their scores in all aspects of the Hunting Competency were near 100 while the bottom performers had scores below 50.

The thing that is most interesting about that is that these are findings that SHOULD have been obvious to the client - but they weren't.  99% of the time, we identify findings, scores, insights and differences that are complete surprises but this time?  Nobody was paying attention and as such, just couldn't understand why these 3 were doing so poorly.

This top/bottom analysis not only revealed a selection problem, where they hired people for hunting roles who couldn't hunt, but a sales management problem too. It would seem that there was no accountability for salespeople to use CRM and it's unlikely that sales management was reviewing the dashboard or reading any of the reports.  This problem would have been easy to spot months earlier if either of those two best practices were being followed.  

Pipeline flow doesn't really refer to the size of the pipeline though.  Flow measures how opportunities move through the pipeline.  From milestone to milestone, activity to activity and stage to stage.  Most salespeople have bottlenecks that inhibit the flow in their pipeline.  The bottleneck is the point in the sales process where a salesperson's opportunities most often get stuck.  Knowing where they get stuck is helpful, but knowing why they get stuck is essential.  You can't fix the problem unless you know why.

It might be as simple as Johnny isn't reaching the actual decision makers.  That's not the why, that's the where. It's a milestone in a stage.  The why can be anything from:

  • Non-supportive beliefs in which the voice in Johnny's head might sound like, "I don't need to speak with the actual decision maker because my contact will take care of it"
  • Lack of skills whereby Johnny doesn't know how to get the actual decision maker engaged
  • A need to be liked where Johnny worries that if he asks to meet with the actual decision maker he might piss off his contact who won't like him anymore
  • Lack of consultative selling capabilities where Johnny got the prospect to "nice to have" but not as far as "must have".  As a result, there is no compelling reason for the prospect to go to or get the decision maker engaged

My favorite CRM application is Membrain which is great for a complex sale.  It's opportunity-focused and has great pipeline management features among many other things right out of the box.  Membrain not only measures time in stage, but also measures stalled opportunities. That helps you get started with the where and the why analysis.  The image below shows a stalled opportunity analysis for a top salesperson.

stall-analysisThe graph makes it very obvious.  If an opportunity stalls for more than 33 days, the salesperson will probably not get the business.  There were five outliers between 76-132 days but they are the exceptions, not the rule.  The 35 wins inside of 33 days, and the 27 losses after 33 days are the rule.

Because Membrain is opportunity focused, you can easily identify where the bottleneck is.  I clicked through on the 6 opportunities to the right of the 33 day mark and most of them lacked the funds to move forward.  That's the where.  The why could be skill, discomfort talking about money (when the budget isn't there) or the less obvious one, failure to uncover a compelling reason to buy.  That means nice to have but not must have.  When a salesperson reaches must have, the prospect must find the money.  When the salesperson only reaches nice to have, it's not crucial to find the money.  When attempting to uncover compelling reasons to buy, it's just like driving in a 55 MPH zone and you must reduce your speed as you enter a 40 MPH zone.  SLOW DOWN.  

And that concludes today's lesson on pipeline flow.  Now you're in the flow.

Image Copyright iStock Photos

Topics: Dave Kurlan, sales pipeline, empty pipeline, delayed closings, uncovering budget

Golden Nuggets from the CSO Insights 2018 Sales Talent Study

Posted by Dave Kurlan on Wed, Oct 24, 2018 @ 20:10 PM

gold-nuggets

I had a chance to review the CSO Insights 2018 Sales Talent Study and extracted some fascinating data.  I thought it might be interesting to take their data, overlay some of Objective Management Group's (OMG) data, and see what we can take away from that.

Tick-Tock.  The report reveals that open sales positions remain so for an average of nearly 4 months and 9 months pass before a new hire achieves full productivity.  That's over a year!  This particular finding is a moving target and somewhat reflective of the relatively small number of proactive sales candidates and far smaller percentage of good ones.  The report shows that only 22.6% of organizations believe that hiring is an organizational strength, so this recruiting performance shouldn't surprise anyone.  OMG has a finding called FIOF (Figure it out Factor) which correlates to how quickly a candidate will ramp up to speed. Candidates who come up to speed more quickly than typical sales candidates score 75 or better and only 25% of all candidates have this as a strength.   

Not Nutritional.  Western diets are notorious for their inclusion of unhealthy, unnecessary, processed, fatty food instead of healthy whole foods.  Similarly, companies listed sales requirements for new salespeople that were filled with unnecessary requirements (ie., business degree from a university, college degree of any kind, STEM degree, industry sales experience, emotional intelligence, etc.) instead of strong and broad capabilities in the 21 Sales Core Competencies.  This suggests that companies still lack a basic understanding of what causes salespeople to succeed.

Tooling.   An equal number of companies use candidate assessments as those who don't.  However, those who do use assessments have 61% quota attainment and 14.6% attrition, versus 49% quota attainment and 19.8% attrition for those who don't use assessments.  Companies that use assessments are 25% more successful at quota achievement and that data is not even for any particular assessment.  Imagine how much better the results are for the companies that use OMG's accurate and predictive sales-specific candidate assessments. Data from companies who have hired salespeople that were recommended by OMG shows an attrition rate of only 8% and quota attainment of 88%.  

Put Me in Coach.  Just 10% of the companies said that coaching was a strength.  That jives pretty well with OMG's data from its evaluations of more than 25,000 sales forces.  Only 10% of all Sales Managers have the Sales Coaching competency as a strength but most of that group are in the top 20% of all sales managers.

Two-Step.  38% of companies reported that they have a sales process.  Respondents appeared to be overly optimistic as OMG's data shows that only 27% of companies actually have a formal, structured sales process.

Right Down the Pipe.  20% claimed that pipeline management is a strength at their company but that claim is even more optimistic than the dance above.  Remember, their report is built from a survey so it's vulnerable to optimistic misstatements.  OMG's sales force evaluation data reveals that the actual number is 8%!

In conclusion, I'm still disappointed that these numbers aren't improving more quickly.  I believe that there are several reasons for this, but my top 3 are:

  • Too many sales leaders have large egos that don't allow them to ask for or receive help, believing that they and they alone are responsible for, and capable of moving the needle
  • The C Suite often delegates responsibility for change but change won't occur until the commitment to change is demonstrated to the sales organization from those at the very top of the company
  • Many companies are well intentioned about change but don't always make the best choices and don't always see those choices through.  Exhibit #1 is CRM.  My observation of CRM selection, installation, training, customization, integration, acceptance, and adoption is that it has been nothing short of an industry-wide cluster fuck.  Please excuse my language.

Of course there are more reasons than these 3 but most of them, when looked at objectively, can be traced back to these three.  For example, we can consider the people, coaching, training, strategy, systems, processes, expectations, accountability, motivation, culture, and more, but as soon as you seek the cause we must look to the original three reasons.

In the end, it's not usually an unwillingness to spend money to improve sales selection, provide the right tools, hire the right sales leaders, consultants and trainers.  It's the lack of unconditional commitment to get it right.

Join the LinkedIn discussion of this article.

Image Copyright iStock Photos

Topics: Dave Kurlan, sales hiring, sales process, sales recruiting, Sales Coaching, sales pipeline, sales opportunities, cso insights, sales recruiting failure

Does Being a Strong Qualifier Correlate to Having a Strong Pipeline?

Posted by Dave Kurlan on Tue, Aug 07, 2018 @ 09:08 AM

qualify

My latest data mining project reveals that the answer to this question is a partial correlation.  

Check out the two tables below and you'll see just what I mean.

All of the data in this article comes from Objective Management Group's (OMG) evaluations and assessments of salespeople.  See the data yourself in all 21 Sales Core Competencies and find out how your team compares by industry, region and more.

The first table shows the percentage of salespeople that have the Qualifier competency as a strength.  Look at the difference between elite salespeople where 93% have it as a strength versus weak salespeople where only 9% have it as a strength.  Also notice that the all of the scores in the table correlate to Sales Percentile.  The correlation ends there.  Strong and elite salespeople who are strong at the Qualifier competency are also strong at the Value Selling competency and have strong pipelines.  However, the 9% of weak salespeople who are strong at qualifying do not have strong pipeline quality and are not strong at selling value.

correlation-qualifier-to-pipeline

The second table has the same three competencies but it's framed based on those with strong pipeline quality.  Once again we see a partial correlation between pipeline quality, qualifier and value selling.  Most elite and strong salespeople who have strong pipeline quality are also strong at qualifying and selling value.  However, most weak salespeople who have strong pipeline quality are not strong in the qualifier or value selling competencies.

correlation-pipeline-to-qualifier

My takeaway from this is that when weak salespeople have strong pipeline quality, it's not because of them, it's because of the circumstances they find themselves in.  They likely stumbled upon the good opportunities, prospects shared more information than normal, and the opportunity moved to a late stage.

Join the discussion of this article on LinkedIn.

Image Copyright iStock Photos

Topics: Dave Kurlan, sales pipeline, qualifying, selling value

Sales Pipeline Data Shows That Most Late Stage Opportunities Just Aren't

Posted by Dave Kurlan on Wed, Jul 11, 2018 @ 07:07 AM

pipeline

If you happened to read the article about most salespeople being fired or arrested if they worked in accounting then this is the sequel - Arrested 2!

That article focused on the number of late-stage opportunities in the pipeline.  Objective Management Group (OMG) conducts a pipeline analysis as part of its Sales Force Evaluations.  We ask salespeople to answer nineteen questions on four late-stage, proposal-ready, closable opportunities each.  In addition to looking at and rating the quality of the pipeline, we then go and re-stage their pipeline based on their answers.  It's pretty cool and the re-staging looks like what I described in this article.

The premise is that if we ask for late-stage, proposal-ready, or closable, then 100% of the opportunities should be in either the qualified or closable stage. I looked into the percentage of opportunities that required re-staging sorted by sales percentile and once again, the findings are powerful and insightful.

Take a peek at the table below where you can see the percentage of opportunities that we replaced in each stage, organized by sales percentile.

restaging-percentages

The first thing you'll notice is that without exception, the percentages correlate perfectly with sales percentile.  This is powerful because OMG does NOT use pipeline data to calculate sales percentile. So the opportunity percentages by stage serve to validate of our sales percentile scores in one more way!

Elite (5%) and Strong (15%) salespeople represent around 20% of the population, while around 50% of all salespeople are weak and the other 30% or so are serviceable.  Notice that elite salespeople had 150% more of their opportunities remain in a late stage (qualified or closable) than weak salespeople who only saw 16% of theirs remain late stage.  That's right. 84% of their opportunities were restaged to either the suspect or prospect stages of the pipeline.

As with the other articles that dig deep into the data, this is less of a surprise and more of a confirmation of what most of us have suspected and believed.  But like the data, it goes deeper.  You've heard the expression, "Inspect what you expect" and it is so true with pipeline.  Before you give elite salespeople a free pass, note that even they had 60% of their opportunities restaged!

My takeaway is that organizations must move from pipeline reviews and forecasts, to pipeline inspections and justifications.  Only then will coaching be in the proper context and will forecasts become accurate and reliable.

Image Copyright iStock Photos

Topics: Dave Kurlan, sales pipeline, omg, sales data

Latest Data Shows Most Salespeople Would be Fired or Arrested if they Worked in Accounting

Posted by Dave Kurlan on Mon, Jul 02, 2018 @ 06:07 AM

jailed

It's summer so they're digging up streets, repaving roads, and repairing bridges.  That leads to epic traffic jams, long commutes and tremendous amounts of frustration.  And you're late!  I've been doing my best impression of the digging, without the paving and repairing.  Ten of my last fourteen articles have been based on Objective Management Group's (OMG) data from the evaluations of sales professionals and like the road work, we're gonna dig some more today!  

In this article, we will look to determine whether there is a correlation between sales percentile, sales pipeline and sales performance.  And as has been the case with the last ten articles like this, the data is sure to surprise.

OMG includes a pipeline analysis as part of every Sales Force evaluation it conducts. We ask each salesperson 19 questions about four late-stage, proposal-ready/closable opportunities currently in their pipeline.  In the table below, the percentage of salespeople who actually had 4 late-stage opportunities on which they could report are sorted by Sales Percentile.

Percentile-PipelineAlmost half of the elite and strong groups, representing the top 15% or so percent of all salespeople, had 4 late-stage opportunities while only a third or so of the serviceable salespeople and just 21% of the weak salespeople (half the population) had 4 late-stage opportunities in the pipeline.  It should come as no surprise at all that stronger salespeople have more quality opportunities in their pipelines.

The table below shows correlation between sales percentile, sales process and sales performance.  

Percentile-Process-PerformanceThere is a strong correlation between sales percentile and sales process. 86% of the elite salespeople (5% of the sales population) and 70% of strong salespeople (11% of the sales population) have the Sales Process Competency as a strength.  It drops off quickly and significantly for serviceable salespeople (34% of the sales population) and dramatically for weak (50% of the sales population) salespeople.  Is it any wonder that only 20% of weak salespeople have Sales Process as a strength?

The most interesting finding was in the area of performance.

While the percentages do correlate to Sales Percentile, the way companies report sales performance is insightful. In the table above, read the column on performance backwards. Companies report that 36% of elite salespeople aren't performing.  In other words, they believe that they "should do better!"  The finding is even worse for strong salespeople where companies say that 43% should do better.  Companies say that 53% of the serviceable salespeople are performing and 40% of the weak salespeople are performing.  This is crazy and it's all about expectations.  Expectations of the best salespeople are incredibly high, while expectations of the crappy salespeople are incredibly low.  For example, take a look at this screen shot of one small company's revenue by salesperson, and whether or not the company believes the salespeople are performing.

performance

As you can see, the company says that their top 2 salespeople, generating approximately $20 million between them, are not performing, while they say that their worst salespeople, generating a little more then $6 million combined from 3 of them, are performing.  Crazy, right?

Quotas continue to go up for the salespeople who perform until they can no longer hit the numbers. Meanwhile, in a race to the bottom, quotas are adjusted downward for crappy salespeople until they hit a mutual area of pathetic.  Some of us intuitively knew that this insanity was occurring, and now we can show proof of this with the data.

We can do so much better than this.  Why do so many executives protect their worst salespeople?  We hear things like, "Their customers love them."  "They serve a purpose."  "They have legacy knowledge."  "They're family."  "I recruited him here from another company we both worked for."  "They're not really costing us anything."

If these crappy salespeople and their protective bosses worked in accounting they would have been fired or jailed for this kind of performance!

What will it take for companies to demand the same performance from all salespeople that they get from their best salespeople?  Better recruiting and selection, better training, better coaching and better accountability.  And what will it take for those things to happen?  Don't hold your breath.

Image Copyright iStock Photos

Topics: Dave Kurlan, sales process, sales pipeline, sales performance, sales data

Discovered - Data Reveals the Biggest Obstacle to Closing More Sales

Posted by Dave Kurlan on Mon, Apr 30, 2018 @ 05:04 AM

decisionmaker

Humans have been waiting for thousands of years to discover the secrets of life.  Why are we here?  Why do bad things happen?  What happens after we die?  Is Heaven real?  What is God's plan for us?

While many experts have attempted to answer all of these questions, most of us lack proof. There's no data.  If we wake up tomorrow morning and suddenly there are not only answers to these questions, but science-based proof, that would be a game-changer for us.

Likewise, every day most companies try to determine why their salespeople don't close more business, why so many opportunities die on the vine, and what they need to do differently to change change their results.  They try everything!  Most leaders think it's an issue of closing skills.  It's not.  Others think it's about prospecting.  While that has an impact on the size and quality of the pipeline, it has little to do with results.  But I have discovered the cause, will show you the data, and discuss how to fix it.

Recently, Objective Management Group (OMG) integrated its sales force evaluation and its pipeline analysis.  Previously, the pipeline analysis was a separate chapter and while very revealing, the data was standalone.  OMG also expanded its analysis of salespeople's ability to reach decision makers and rather than a finding as it once was, it is now a full competency with 8 attributes.

I have reviewed several dozen sales force evaluations conducted since the change and discovered something very revealing.  Look at the bar graph shown below:

DM's

This is VERY representative of every sales force evaluation I reviewed for this article. There is a lot going on in this graph so let me walk you through it.

This sales force averages 54% of the attributes for reaching decision makers but only 13% (green slice of the pie) are strong at this competency.  The overwhelming majority of the salespeople believe in the importance of reaching decision makers and use their skills to attempt that.  Let's focus on the first two attributes which are both Calling on Actual Decision Makers but show contradicting data.

DM2

Let's start with the second attribute.  We ask each salesperson to identify 4 late-stage, proposal-ready or closable opportunities and we ask them 19 questions about each of those opportunities.  Nearly 90% of the salespeople met with the actual decision makers on these late-stage opportunities.  That's pretty good.

The first attribute comes from each salesperson's personal evaluation.  It shows that only 10% of them are reaching actual decision makers overall.  That's pretty bad.

Now that we have these two opposing data points, it should be clear what the problem is, both for this company and for many of the companies showing the same contradiction.

When salespeople successfully reach the actual decision makers, opportunities move through the pipeline and reach the closable stage, often resulting in a win.  However, MOST salespeople are NOT reaching the actual decision makers and those are the opportunities that lose traction and/or result in a loss.

Remember, for the most part, these are salespeople who believe it's important to reach the decision maker, have that as a milestone in their sales process, have the sales skills to reach decision makers, but still fail to reach the decision makers. 

Let's take a closer look at a few of the other attributes.

DM3-1

Half of their salespeople are calling on buyers at the start of the sales process.  Why are they doing that?  Nearly half aren't comfortable meeting and talking with the target decision makers, and a third need to be liked and can't push back on buyers who won't introduce them to or allow them to meet with decision makers.

Clearly, this is not the only problem that sales organizations are facing by a long shot.  However, this data shows that if they could fix just one thing today, the consistent ability to reach decision makers would make a huge difference.

It's one thing to know what the problem is and its impact on results.  However, fixing this problem is not  simple. Reaching decision makers is made possible by having advanced listening and questioning skills in an effective consultative selling process, an ability to differentiate, and being perceived as a trusted advisor.  Reaching decision makers is time sensitive in that the timing must be perfect to consistently succeed at getting the decision makers to engage.  Let me use my expert ability to combine baseball and sales for the perfect analogy.  Have you read Baseline Selling?

If the batter swings too early he will probably miss the pitch or perhaps hit a weak ground ball.  If the batter swings too late he will probably miss the pitch or perhaps hit a pop fly ball.  If the batter times his swing perfectly and squares the bat to the ball he will crush it.  Salespeople need to crush it when it comes to reaching decision makers.  They must time their ask perfectly or they will probably strike out.  You can also use comedy as an analogy where the comedy writer provides the same routine to a professional comedian and an amateur.  The words coming out of each person's mouth would be identical but the professional comedian gets the laughs because of having mastered the timing and cadence of the delivery.

This problem can be fixed but the trainer or coach providing the help must have a mastery of the nuances of how these pieces all come together.  If your salespeople can reach even 25% more decision makers, think about the impact that will have on revenue.

You can see all of OMG's data for all 21 Sales Core Competencies, by industry and even see how your company compares.

Image Copyright iStock Photos

Topics: Dave Kurlan, Consultative Selling, sales process, sales pipeline, reaching decision makers, closing more sales, win rates

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About Dave

Best-Selling Author, Keynote Speaker and Sales Thought Leader.  Dave Kurlan's Understanding the Sales Force Blog earned a medal for the Top Sales & Marketing Blog award for six consecutive years. This article earned a Bronze Medal for Top Sales Blog post in 2016, this one earned a Silver medal for 2017, and this article earned Silver for 2018. Read more about Dave.

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