For double article Friday, in addition to my Sales Pipeline Nazi article, I have the following bonuses for you:

For those of you who wanted to attend the Webinar on the Sales Candidate Analyzer, here is a link to the recording.

WittyParrot has just released the Top 50 Sales Productivity Tips ebook with 50 Experts, including me, offering their advice.  Download it here.

And the March Issue of Top Sales Magazine is available!  It includes an article from me and several other noteworthy sales writers.  You can download your copy here.

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The Sales Pipeline Nazi

When I wrote this article, the Northeast corner of the US was being walloped by yet another snowstorm, which in this case, was very accurately forecasted.  At the same time, the first email I saw today had a link to a very funny video – a spoof of a Pipeline Review being run by Hitler.  Here is a link to that video on You Tube.

So the storm and the video led me to the following thoughts.

We joke a lot about sales forecasts being no more accurate than weather forecasts, but everything is relative.  An inaccurate forecast of cloudy won’t have much of an impact on anyone, but an inaccurate forecast of sunny and warm might.  An inaccurate forecast of flurries might not cause a problem if they don’t materialize, but an inaccurate forecast of a foot of snow – in either direction – has serious consequences.

Inaccurate sales forecasts are legendary.  Here are the 10 most common reasons why salespeople, sales managers, Sales Directors and CEO’s suffer from this: 

• They lack a formal, staged, criteria-based pipeline.
• They lack a functional, sales-specific CRM or Pipeline Management application.
• Their sales process is not integrated into the CRM/Pipeline Management application.
• Salespeople have the power to suggest the likelihood of closing.
• Salespeople have the power to override the application’s weighting of an opportunity.
• Salespeople fail to LIVE in the CRM application, providing infrequent updates, causing most report and dashboard data to be outdated.
• There is a lack of accountability for keeping the application up-to-date - not weekly, not daily, but in real-time!
• The data being entered is not being inspected by management.
• Nobody cares about getting it right.
• The concept of pipeline management has not been integrated into the culture.

As for the weather, we learn to live with those inaccurate forecasts by preparing for the worst.  We also learn to check back often, get an updated forecast the night before, the morning of and right before that outdoor event, trip to the airport, or 6-hour drive.  What if our salespeople did that?  What if sales managers did that?

If sales forecasts are truly like weather forecasts and we have learned to make the best of the weather, why can’t we simply employ the same strategies and tactics to sales forecasts?  Why can’t we get updates, check-in, check back, verify and re-verify?  Why can’t we get it right?  Why don’t we get it right?

In my opinion, there are a combination of factors at play that discourage salespeople from taking the steps that I just mentioned:

• Laziness – “It’s too much work!”
• Fear of Rejection – "When I check back, what if they changed their mind?”
• Need for Approval (Need to be Liked)  - “They might not like me anymore.”
• Fear of being wrong – “How could I live with myself?”
• Pressure to find new opportunities – The only time hunting takes precedence over anything!
• Consequences of removing an opportunity and its related value from the forecast and/or pipeline – “It’s much better to slide the opportunity to next month than the alternative.”

We must get sales forecasting right.  And we can.  If one company can do it, all companies can do it.  But it takes a commitment, from the top down, to make it work.  It takes work after the commitment has been made.  If the first 9 reasons, from my list at the beginning of the article, are properly addressed and the appropriate commitment has been made, then any company wishing to have an accurate sales forecast can have one. 

By now most of you probably know that the Boston Red Sox pulled off one of the greatest comebacks in Post Season Baseball history, coming back from a 7-0 deficit in the 7th inning to beat the Tampa Bay Rays 8-7.  But as exciting as that was, the story is about the fans.

If you observed the Tampa Bay fans during game 1 in St. Petersburg and game five in Boston, you would have observed some very tense, anxious people.  Yet if you paid any mind to the Red Sox fans in the three games they lost and prior to their comeback in game 5, they didn't seem very upset at all.

Those worried, upset Tampa Bay fans looked just like the Red Sox fans did in 2003 and 2004, when the Red Sox hadn't won a world series in 86 years.  But now that they have won two world series in the past four years, the fans were calm, they've been there.

When salespeople have plenty of opportunities and have experienced plenty of difficult sales cycles, it's not such a big deal when an important opportunity dies.  But if it's a salesperson that has very few quality opportunities or one who hasn't experienced very many deals that went sour, they react - badly - by getting quite emotional, discouraged, and upset.

The cure? Have your salespeople stuff the pipeline.  Prospect like hell. Work those opportunities.  The weak opportunities may die away but there will always be good ones on which to focus.  And don't discount the possibility that even the deadest of opportunities could miraculously come back from the dead.  Especially in big companies where the decision makers leave for greener pastures and get replaced with executives who do want to do business with you!

This can be a discouraging time.  It's important to keep your salespeople motivated and the best way to do that is to keep them busy.

(c) Copyright 2008 Dave Kurlan

Here is a video where I discuss creating a culture of overachievers.

There isn't a single key to overachieving, so I'll list my top 10 factors for helping salespeople overachieve.  I'm sure I've written about each of these topics at some point in the past, but I'll put them all together here:

Goals - I'm talking "raise the bar, stretch, out of the comfort zone, more than the typical 15% increase in sales" type goals here.  You must raise expectations in order to celebrate superior performance.  Don't forget two things: (1) that a forecast and plan come from the goals; not the other way around; and (2) goals are derived, not from the company, but from the individual's income requirements, based on the bills that accompany life's obligations and desires.

Incentives - including compensation, contests, commissions, awards and prizes.  Incentives bridge the gap between corporate carrots and the personal goals we just discussed.  If an individual has the goals but the company's compensation isn't designed to reward superior achievement, the incentive to perform can not be maintained.  If the company has a rock-solid compensation plan but the goals are wouldn't excite Dr Phil, the personal incentive to perform will be AWOL.

Managing the Pipeline - a Visual Pipeline makes it significantly easier to manage the pipeline but the key to managing the pipeline effectively is working with your critical ratios.  Think monthly goal, closing percentage, average sale and length of the sell cycle. Let's say that your salesperson has a six month sell cycle, a $100,000 monthly goal, a $20,000 average sale and a 25% closing percentage. Effectively managing the pipeline requires that your salesperson places 20 (5 $20,000 sales x 4 at 25% closing) new opportunities worth of total of $400,000 (25% of $100,000) into the pipeline 6 months in advance of the monthly goal (if the goal is for July then the opportunities must enter the pipeline in February).  Get that to work and the outcomes are all but guaranteed.

Accountability - This is such an important factor in over achievement.  You must hold each salesperson accountable to something measurable (like the number of conversations required to book the number of sales calls required to identify those 20 new opportunities) every day.  Even more importantly, you must have consequences for failure to meet those requirements and consistently follow-through whenever necessary.  Develop the nerve for full accountability and you're nearly there!

Motivation - This is the combination of Goals and Incentives. In essence, does the salesperson have a strong enough Desire and Commitment to do whatever it takes - every day - to reach the goals?  When they don't, it's your job to motivate them by knowing what each salesperson's goals are. I'm not talking income requirements or gross sales here, I'm talking planes, boats and cars; big houses, vacation homes, golf trips, world travel, home theaters, fantasy camps, exclusive events, etc.

Self Starter - Last week I posted an article that discussed what it takes for salespeople to succeed in a remote location.  Those factors, whether salespeople are more effective when working independently or as part of a team; and whether they require supervision or can work without it; help to determine whether they are self-starters.  If not, you must start them up every day, twice daily or as often as it takes.  If you have self-starters, you are one lucky manager.

Skills - The more the better, but let's focus on the most important skill sets for overachieving.  Your salespeople must be able to hunt for new opportunities, identify the most qualified and be able to close them.  Anything else they can do is a bonus!

Urgency -  I wrote about Closing Urgency in January.  Your salespeople must have enough urgency to get their opportunities closed, when they become closable, even when their prospects are trying to put them off.

Weaknesses - Unfortunately, there are weaknesses that will neutralize all of the previous 8 factors.  There can be dozens of weaknesses that could impact performance but none are so powerful as these five:  Non Supportive Buy Cycle, Need for Approval, Tendency to Become Emotionally Involved, Money Issues, Self-Limiting Record Collection.

Coaching and Training - Your coaching must support any training initiative and help salespeople overcome their weaknesses, develop skills and master the selling process.  While most training will be conducted by sales development experts from outside your firm, the coaching absolutely takes place from within.  Pre-call strategizing and post-call debriefing, with every salesperson, every day.

This list of factors is not all inclusive but it's a good start.  You can build a sales force of over achievers if you incorporate not some, but all of these factors.

© Copyright 2007 Objective Management Group, Inc.

First, you can’t tell if the pipeline is balanced unless you can visually see what’s in there in some way other than a report or a spreadsheet. My favorite way to look at a pipeline is to overlay the pipeline on a baseball diamond. Each of the base paths represents a different category of prospect. Suspects – those with whom an appointment is booked line up on the first baseline. Prospects, those who have need, a compelling reason to buy and, what I call S.O.B. Quality (you’ll have to buy my upcoming book to learn about that) are on the second base path. Completely qualified prospects (criteria in the new book) show up on the path to third base and all of the closeable prospects line up on the third base line.

Once you have assigned each opportunity in your pipeline to the appropriate place on the baseball diamond, you can visually see your all of your potential new business, where the revenue is sitting and what will really close. More importantly, you can see whether the pipeline is balanced. A balanced pipeline will typically have two to three times more suspects than closeable opportunities. If the one you are looking at does not, there isn’t enough prospecting for new business taking place. Try doing that with a spreadsheet!

© Copyright 2005 Objective Management Group, Inc.