Can Sales Statistics be Bad and Good at the Same Time?

Posted by Dave Kurlan on Tue, Feb 20, 2018 @ 22:02 PM

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I received two pieces of bad news relative to statistics.  

The first is about my award-winning Blog.  It seems that readers stay with an article for an average of only one-minute or so.  That means that most readers don't finish the article, fail to get to my summary, and often don't read long enough to get my point.  Basically, everything that comes after the fourth paragraph is not being read.  This could also be good news.  It could mean that I can actually write shorter articles and that would be great for me!

The other piece of bad news relates to my award-winning sales training company, Kurlan & Associates.  I reviewed 5 years worth of statistics on opportunities that weren't closed and it seems that prospects were 6 times more likely to do nothing than to do business with a competitor.  We don't lose very often and I can count on two hands the number of opportunities I have personally lost in the past 5 years.  But it's one thing to rarely lose, and another to learn that 6 times more often than not, a company failed to act.   But these statistics are very misleading. Let me explain why.

Our business is not one where companies always purchase from somebody and it's only a question of from whom (think network copier).  It isn't a given that companies will follow through on training, coaching, sales process, recruiting, evaluating, assessing, sales enablement, consulting, etc.  A few don't have the appetite to spend the money (too late for them).  Some don't believe they really need the help (ego).  Most aren't willing to do the work (change) to achieve results.  

Still reading?  Oh, you're the one who stays past one minute and the fourth paragraph!

These two crappy statistics are connected in that both are related to attention and engagement. 

The one-minute stat is an average.  Some people stay on an article for 5 minutes to thoroughly digest an article while others exit after reading the title or seeing that I am the author.  They must hate me.  It means that there is enough readership so that the average time on page doesn't even matter.  It's a meaningless statistic that might cause some people to find a solution and improve the number.  Not me.  The average is the average and I don't care about averages.  I write for the people who read my articles, not for those who don't.

The same is true for those who in the end, don't buy from anyone.  It means that we are filling the pipeline and the natural attrition in our pipeline is as it should be.  It says that we are qualifying effectively but even that requires some digging to be certain.  Do these opportunities pass through all four stages of the sales process, including a proposal, before the prospects decide to live with the status quo?  Or, are we recognizing their lack of commitment earlier in the sales process and disqualifying the opportunity at that point?  Fortunately, it's the latter.  We usually move on from them before they have a chance to move on from us.  The more meaningful statistic is that we rarely lose!

Are you paying attention to stats like these?  Are they telling you a story about sales effectiveness or lack thereof?  Are the stats suggesting that you need to do things differently?  Do the stats suggest that you stay with an opportunity too long? 

We use a scorecard just like the ones we customize for our clients.  The scorecard keeps us on the straight and narrow and prevents us from chasing opportunities that score below 65 points.  It helps us disqualify very early in the sales process.  Do you have a scorecard that is predictive like ours?

The reality is that there are no bad statistics.  There are statistics that tell a story and those that don't.  There are statistics you can learn from and those you can't.  There are statistics that are forward looking and those that are lagging and that means that there are statistics that are predictive of something and those that aren't.  

When was the last time you looked at some of your statistics to determine what story is being told and the changes you need to make?

Image Copyright iStock Photos

Topics: Dave Kurlan, sales process, sales pipeline, sales metrics, scorecard

What You Should Know When Your Cold Prospect Suddenly Returns From the Dead

Posted by Dave Kurlan on Mon, Jan 15, 2018 @ 06:01 AM

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Last week I wrote about the deep freeze, why prospects suddenly go cold, and how you can prevent that from happening. That article was instantly as popular as any I have ever written.  I also posted a 6-minute  cold-calling rant on LinkedIn that had more than five-thousand views after just a couple of days. The video, like the article, was about mindset, not scripting and tactics.  And last week I also posted an article about writing a good prospecting email.  It seems that there was a theme to the week and it resonated really well with the readers.

Let's build on that theme and discuss the same prospect that went cold two months ago, and now he calls or sends you an email. 

Hopefully, you had archived the opportunity rather than hoping and praying for its revival.  The biggest mistake that salespeople make at this point is they get excited.  I don't know about you but for me, when a supposedly good prospect goes cold and then returns two months later, it's more like the return of the flu.  This prospect caused you a lot of anxiety, embarrassment with your manager, and wasted time.  Who wants more of that?  I raise that issue because the chances of your prospect going cold again are greater than the likelihood of a sale.

For that reason, skepticism should be your number one strategy.

Why has your prospect returned and why now?  A number of things happened with your prospect since your last conversation and you need to hear their story.  What they share could be predictive of what will happen next and what you should do.  For example:

What They Might Say What That Could Mean What You Should Do
We have one more question They will go cold again as soon as you answer the question Ask them a question.  Why did they call you back?  Do not accept "because we had a another question for an answer.  Instead, mention that they didn't return calls and emails for two months so why now?
We would like a proposal They are moving forward but at what speed and with whom? Ask how many proposals they are requesting.  Ask why they included you.  Don't accept out of respect for the time you already invested. Instead, suggest that it doesn't sound like you are their first choice so why are they including you? 
We want to meet A good sign - they like you enough that it won't be a waste of time Schedule time to meet and ask what is on their agenda and their desired outcome of the meeting.  Then ask if you can share your agenda and outcome.
We want you to present They are moving forward but at a snail's pace.   Ask how many companies they invited to present.  Ask why they included you.  Don't accept out of respect for the time you already invested. Instead, suggest that it doesn't sound like you are their first choice so why are they including you?  
Our [top-ranking executive] wants to talk with you A good sign - they like you enough that it won't be a waste of time Schedule time to meet and ask what is on their agenda and their desired outcome of the meeting.  Then ask if you can share your agenda and outcome. 

The reality is that in most cases, prospects go cold when you weren't talking with the right person.  When they return from their self-imposed ice age they are still the wrong person so don't expect anything different to happen unless the top executive decision maker is fully engaged.

You could even experience these issues if you are talking with a weak decision maker who needs to build consensus.  Decision makers go cold too if they don't get the consensus they are looking for.

If you maintain a healthy level of skepticism, ask plenty of questions and keep your discussion conversational you will get a much better sense of where you really are and whether you will get the business.

Although the prospect has returned, the opportunity can be reactivated in CRM and the odds are no longer zero, don't become too optimistic.  Your odds of closing the business are no greater than 49%.

Image Copyright 2018 iStock Photos

Topics: Dave Kurlan, sales pipeline, sales tips, dead prospect, cold prospect

Grammar - Why Commas Provide Sales Success Where Periods Fail

Posted by Dave Kurlan on Tue, Jul 18, 2017 @ 20:07 PM

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Image Copyright Eerik

You've heard it all before - but not quite this way.

The one thing you need in order to have a successful sales force is CRM.

The one thing you need in order to have a successful sales force is a powerful Inbound initiative.

The one thing you need in order to have a successful sales force is a customized sales process.

The one thing you need in order to have a successful sales force is lots of leads.  Really?

The one thing you need in order to have a successful sales force is targeted marketing.

The one thing you need in order to have a successful sales force is a custom scorecard.

The one thing you need in order to have a successful sales force is outsourced calling.

The one thing you need in order to have a successful sales force is an in-house BDR team.

The one thing you need in order to have a successful sales force is a custom sales playbook.

The one thing you need in order to have a successful sales force is a sales force evaluation.

The one thing you need in order to have a successful sales force is ongoing sales training.

The one thing you need in order to have a successful sales force is sales coaching.

The one thing you need in order to have a successful sales force is a consultative approach.

The one thing you need in order to have a successful sales force is the right messaging.

The one thing you need in order to have a successful sales force is a daily huddle.

The one thing you need in order to have a successful sales force is a weekly pipeline review.

The one thing you need in order to have a successful sales force is a full pipeline.

The one thing you need in order to have a successful sales force is a goal-oriented sales force.

The one thing you need in order to have a successful sales force is a sales selection tool.

The one thing you need in order to have a successful sales force is a sales recruiting process.

Of course there are more; many more.

The problem is one of grammar.  All of the articles you read, videos you watch and audios you listen to suggest that there is a key to sales success.  Period.  But if you change the period to a comma, you'll quickly see that all of these things are crucial to success in sales.

 

Topics: Dave Kurlan, sales process, sales management, Sales Coaching, sales pipeline, keys to sales success

Predict the Weather but Control the Sales Forecast and Revenue

Posted by Dave Kurlan on Tue, Jun 06, 2017 @ 06:06 AM

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Image Copyright Mark_KA

It's June 6 in Westboro, Massachusetts, USA, and the temperature is 49 degrees Farenheight or 9 degrees Celsius. It's pouring rain and with the exception of 3 nice days in the middle of May, when the temperature was in the 80's, it's been like early April since, well, early April!   The weather sucks.  And in case you aren't familiar with what the weather should be like at this time of year, it should be 80 degrees (27 degrees Celsius) and sunny.  

You may be more familiar when the rant sounds like: "It's almost the end of the quarter, we're only at 65% of forecast, the pipeline is half empty, and nothing is closing. With the exception of 3 nice deals that came in during May, our salespeople have sucked." 

While the crappy weather and your crappy 2nd quarter revenue have crappy in common, there is one huge difference that can help you hit your sales forecast even when the weather forecast is for rain.

As long as you know the monthly sales goal, closing percentage, average order size, and length of the sales cycle, I will guarantee that you will meet or exceed the sales goal.  Let's pretend:

  • The monthly goal is $100,000
  • The closing percentage is 20%
  • The average sale or account is $25,000
  • The sales cycle is 6 months.

If you do the math and nothing else but the math, then as long as 20 new opportunities, worth a total of $500,000, enter the pipeline each month, beginning 6 months ahead of the first monthly goal you intend to meet or exceed, you will never miss another sales goal ever again.

Let's walk through the Algebra.  If you close 1 of 5 then 5/1 x $100,000 is $500,000.  But you can't just have one or two big opportunities worth $500,000 in the pipeline because you close only 1 of 5.  Remember, your average sale is $25,000 so you'll need close 100,000/25,000 or 4 and at 20% that's 4 x 5 for 20 opportunities.  Finally, with your 6 month sales cycle, what you add to the pipeline in June represents December revenue, not June, so beginning this month you're working on next year's revenue.

As long as you manage what you can control - the new opportunities that enter the pipeline - then you will never miss another number again.

Back to the weather.  Consider my rule of puppies, which says that the harder it is raining, the more often the puppy will want to go outside and make sure that I get wet. And don't forget the rule of spring baseball, which states that the more games our son is scheduled to play during April, May and June, the colder and wetter the weather will be.

Topics: Dave Kurlan, closing, sales pipeline, sales forecast

Veteran's Great Quote Makes News and Has Terrific Lessons for the Sales Profession

Posted by Dave Kurlan on Tue, Feb 21, 2017 @ 14:02 PM

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Disclaimer:  This is not a political post even though I quoted someone with a political opinion.  The entire article is about sales.

On my way to the office, I was listening to FOX News when they cut to a diner in Jacksonville, Florida to interview some of the patrons there.  One of the people interviewed was Stanley, a Veteran who said he had two messages he wanted to share.  He said, "To the media, don't make in-depth assumptions from shallow observations.  And to the obstructionist democrats, we have a saying in the military.  When the horse dies, dismount and quit riding that dead horse."  

I might not have nailed his quote word for word, but I'm sure I captured the gist of it. Just think of the sales lessons that can be taken from this!  The short video below is from the FOX interview and below that I will share some lessons for the sales profession.

Don't Make In-Depth Assumptions of Shallow Observations.  Salespeople make more assumptions of a prospect's buying potential and readiness than you can imagine.  They observe what appears to be interest and then, instead of uncovering their compelling reasons to buy, thoroughly qualifying and building a case, they assume the prospect is "good" and will "probably" do business, hastily create a proposal, forecast the business to close, and then spend most of their time in the act of futile and ineffective follow-up.  Result?  Dead opportunity.

When The Horse Dies, Dismount.  Salespeople with nothing but dead opportunities in their pipeline are pretty much dead themselves.  We are seeing inadequate pipelines in many companies and there are multiples reasons for it.  They include, but aren't limited to: 

  • Lack of accountability
  • Lack of clear expectations
  • Confusion over whose job it is to find new opportunities
  • Unwillingness to make cold calls
  • Over-reliance on social selling

Salespeople who include their dead opportunities in the pipeline are reluctant to archive them for several reasons.  They include, but aren't limited to:

  • Fear of letting go
  • Repurcussions of an empty pipeline
  • The reality that without those opportunities they will have to prospect
  • Fear of rejection
  • Alternate facts
  • Lack of Commitment
  • Poor Outlook
  • Ineffective Hunting skills

I believe that Stanley shared two great, shallow quotes that deserve more in-depth analysis!

Speaking of News, here are some other things you should be aware of.

My thoughts and a fantastic Wharton School of Business video on why sales leaders fear predictive assessments appear on LinkedIn Pulse. Read and watch it here.

My Annual Sales Leadership Intensive - the best two days of training on the planet on how to be an elite sales coach - is coming up on May 17-18.  Learn more here. If you would like to attend, use discount code DK-Blog-Subscriber.

Earlier today, I presented a 30-minute session on how OMG's Tailored Fit is not only different from benchmarking, but makes benchmarking silly and unnecessary.  It was very fast-moving, had lots of data, a good story line and a sneak peak at the magic of the OMG sales selection tool.  

Topics: Dave Kurlan, sales leadership, sales pipeline, selling tips, lost sales opportunities, fox news

It's Coming Sooner Than You Think - 5 Keys to Prepare Your Sales Force for the Recession

Posted by Dave Kurlan on Thu, Mar 10, 2016 @ 06:03 AM

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You remember the last recession - the great recession - right?  I remember that in November of 2008, the business stopped coming in as if someone had turned off the faucet.  Bam!  We lost a third of our revenue overnight - and we were prepared for it!  I predicted the last recession as early as September of 2006 with this article and in the summer of 2008 with this article.

In my business, I can see two trends ahead of others and I began seeing both of those factors begin to kick in last month.  Do you know what  they are?

The first is sales candidates.  For about two years, there has been a very significant shortage of great candidates.  But that began to change last month, when in the areas where it has been most difficult to find good sales candidates and sales management candidates, we are now beginning to see more of them express their interest.  Why?  Things are not looking all that rosy where they are working and they are out ahead of the curve looking to make a change.

The second is spending freezes.  We are starting to see the larger companies put all unnecessary spending on hold - they are hoarding cash again - and when that happens, the economy stops growing, begins to shrink and bam - we are in a recession.

I sure hope I'm wrong, but the signs tell me I'm right.  So what does this mean for you?  These are the top 5 things you must do right now:

  1. You had better sell your ass off while you can because we just might have another 2-3 year dry spell.  It's not a coincidence that by the time the 2008 election took place, we were deep into it.  And what's coming up at the end of 2016?  Right.  And with the way the election is shaping up, our choices might not be the ones that we had envisioned.  If things continue the way they are heading, the choice will be the guy who is bad for business or the guy who is bad at being presidential.  (Just an observation, not a political stance!)
  2. You must be better at differentiating, selling consultatively, selling value, qualifying and closing than ever before.  On the line are the opportunities sitting in your pipeline today.  If you fail to get them closed because you skipped a step or two, or you accepted a put-off, you might not get that business closed until 2019!
  3. Prospect like never before.  Get every possible new opportunity into your pipeline while prospects are still willing to meet with you, talk with you and share with you.  Then see #2.  The window won't be open for very long.
  4. Salespeople who do OK when things are good, tend not to do so well when things take a turn for the worse.  If you have any salespeople that suck when it comes to getting people to spend money when they don't want to, then now is the time to get them trained.  Do not put this off.  Training for reasons like these is not  a nice to have, it can mean the difference between killing it in a recession and being killed.
  5. Coaching!!  Sales leaders must become masters at coaching - now - because the one thing that can make a difference is constant, effective, non-stop, coaching.  Impact every opportunity.  Grow every salesperson.  The timing is perfect as my top-rated annual Sales Leadership Intensive is coming up in May.  Attend this comprehensive two-day coaching extravaganza and you should be able to coach your salespeople through a recession.

Get ready because here it comes!

Topics: sales pipeline, Closing Sales, sales effectiveness, long sales cycle, sales win rates, recession of 2016

Sure Fire Way to Know Which Sales Opportunities are the Best Sales Opportunities

Posted by Dave Kurlan on Wed, Feb 24, 2016 @ 06:02 AM

I just love it when cool gets cooler and I'm not talking about the winter weather in New England.  About a month ago, I wrote this article on Targeting and shared a generic model for scoring opportunities.  George Bronten and Henrik Oquist, CEO and COO of Membrain, took note and already developed the concept as a new feature for their world-class CRM application, Membrain.  You have to see how we integrated this new feature into the Baseline Selling version of Membrain.  In the image below, you can see that we added a scoreboard milestone at two stages of the sales process.

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This allows us to purposefully rescore an opportunity as we learn more about it.  The next image has a little more of the scoring detail.

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As you can see from our own instance of Membrain, we score the size, title, urgency, timeline and amount of competition for a particular opportunity.  This opportunity would have received a much higher score if there it was a smaller company, there was greater urgency and the timeline were this month instead of this quarter.  You might be questioning why the score would be higher if the company was smaller...A bigger company has 10 times the number of things that could delay or prevent a sale from closing and while all of those things could also occur with a mid-market or smaller business, they are far less likely at this stage in the sales cycle.  Don't believe me?  Then you don't have enough experience with enterprise size accounts!

Finally, in this listing we can rank opportunities by their scores (right-hand column).

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Some CRM applications have the ability to rate the likelihood of closing based on assigned weights to various milestones or stages.  While that is better than when salespeople enter an arbitrary percentage, it's not nearly as good as when you have created specific criteria and values.  Neither man nor machine can skew those things!

In just a few days, this scoring system has had a tremendous impact on our company.  We are able to look at opportunities through a different and more accurate lens, allowing us to make better decisions about sales forecasts, resource allocations, and specific opportunities.

Thanks, Membrain!

Topics: Dave Kurlan, sales process, sales pipeline, membrain, sales forecast, scorecard

What True Story Does Your Sales Pipeline Tell You about Your Business?

Posted by Dave Kurlan on Thu, Nov 05, 2015 @ 12:11 PM

Yesterday I was looking at the dashboard in my new car and noticed that one of the gauges could be swapped out.  There aren't any fixed gauges on this dash because the gauges, ranges and needles are displayed digitally. I can even change their color!  The thing that caught my interest though, was the flashlight effect where the ticks to either side of the needle are brighter and bolder to draw attention to where the needle is pointing.  That got me thinking about the dashboards for my company.  First I looked at the dashboards for Kurlan & Associates and because of what I saw, I never got to the Objective Management Group dashboard.

We use Membrain for our CRM/Opportunity/Pipeline Management system because it's the one we recommend most often to our clients and if we're going to recommend a CRM application, shouldn't it be the one we use, embrace and love?

While changing the filters for one of the graphs, I noticed some things that I hadn't noticed the last time I checked in.  And I promise, the things I noticed are probably occurring at your company too.  The question is, can your CRM application let you know (and do you know) what to do next?  So here's what I found that was so interesting.

In the past two months, there were 40 new opportunities added, bringing the number of active opportunities in the pipeline to 80. That's an average of 1 new opportunity per person, per week, which is exactly what it should be in our business.  So that's good.  But I also noticed this:

There are currently 16 highly probable, closable opportunities representing 20% of the pipeline which is a lot better than what we normally see.  For instance, for every 2 new clients, it historically requires the following:

  • 20 suspects that convert to,
  • 10 prospects that convert to,
  • 5 qualified opportunities that convert to,
  • 3 closable opportunities.

In other words, only 10% of the prospects we begin talking with typically become clients.  Not because we aren't effective or that prospective clients go with other companies; but mostly because half of the 20 suspects we start conversations with are either the wrong person for us to be speaking with or there isn't a good fit and we disqualify them!  Similarly, we often disqualify half of the remaining 10 prospects because they don't have or won't spend the money to work with us.  That's how we get from 20 to 5.  And as with any business, we don't close every one.  Some decide to do nothing at all and once in a blue moon, a prospect chooses to go with another company.

I also noted that there was forward progress made on 58 opportunities - meaning that no single opportunity is sucking up the team's time or resources at the expense of other opportunities.

The metric that really stuck out for me though was that 22 of the 80 opportunities were stalled.  They had exceeded the baseline number of days allowed for an opportunity to remain in a particular stage of the sales process and our dashboard in Membrain has some very compelling data about opportunities that stall.  The image below represents the graph of stalled opportunities. Green represents an opportunity that we closed and gray represents one that we archived or lost.

This small red line in this graph indicates that when an opportunity stalls for more than 19 days, the chances of closing that business decrease dramatically, from 78% to less than 50%.  It further illustrates that if an opportunity stalls beyond 35 days, there is very little chance that the opportunity will close, with the win rate dropping to just 10-15%.

So when I saw that there were 22 stalled opportunities, I dug a little further and found that all of them were stalled beyond 35 days.  So the probability of any business occurring with these opportunities is already below 15%.  Next I wanted to identify which stage of the pipeline they were stalled in.  In Baseline Selling, we have 5 stages of the pipeline where opportunities are either:

  1. On Deck - 1st Meeting has not been scheduled.
  2. 1st Base - 1st Meeting has been scheduled but not yet held (Suspect).
  3. 2nd Base - 1st Meeting has been held and it is a real opportunity (Prospect).
  4. 3rd Base - Opportunity has been thoroughly qualififed (Qualified).
  5. On the Way Home - Opportunity is Closable (Closable).

I found that all but four of the stalled opportunities were on Deck.  So either a lead had come in, someone had expressed interest or we were referred to the company but no meeting had been scheduled - after more than 35 days!

That's the beginning of the process of reading a useful CRM dashboard.  The data tells us where the problem is, who has the problem, and what we should be asking.  In this case, one person - a very busy senior sales expert - was responsible for 36% of those stalled opportunities.  So while we can understand how the business interfered with getting meetings scheduled, it is still not acceptable.  The opportunities should have been handed off to a consultant on the team who isn't as jammed with training, consulting and coaching as he is.  In another case, one person was only responsible for 5%, or just 1 of the stalled opportunities.  That's good, right?  No, it's bad.  Everything is relative.  He doesn't have as many opportunities in the pipeline as the others, so his 1 stalled isn't an indicator that he's moving things along as much as it's an indicator that his pipeline is too small!

While most of my articles address sales selection, sales force evaluations, sales competencies, sales DNA, sales strategy, sales process and sales tactics, sometimes getting the pipeline right can make all the difference in the world.  Of course, to get the pipeline right, you must have an application that gives you the right information, in an easy-to-access format.  You also need an application that your salespeople embrace and always keep up-to-date so that you have real-time data.  And finally, you must be willing to consistently review your dashboard and let it tell you a story.  What story is your dashboard telling you today?

And before you comment, I'll make the first one:

"Dave, you talk about consistently reviewing the dashboards, but in this case, you weren't aware of the stalled opportunities until they were all beyond 35 days.  Isn't that hypocritcal you fat, old, sales guy?"  Someone was going to write that so I figured I would save him the trouble.  Yes, it would have been a male troll.  And yes, I should have been on top of that, but I wasn't this month.  And hey, my mistake is your gain because it made for a good topic for the blog, didn't it?

Don't miss this article that was published on LinkedIn Pulse about Fred - The Top Salesperson or a Horrible Salesperson?

 

Topics: Dave Kurlan, sales process, sales pipeline, sales win rate, sales opportunities

Sales Slumps - What Causes Them and How to Fix Them

Posted by Dave Kurlan on Mon, Sep 28, 2015 @ 13:09 PM

During the course of a baseball season, both hitters and pitchers fall into slumps. In basketball, players slump with their outside shots and from the foul line. Football Quarterbacks go into passing slumps. Golf and Tennis pros have swing slumps. Tiger has been in a slump since Thanksgiving of 2009! (I'm sure there must be some kind of a slump that Soccer players can fall victim to, but I don't know enough about soccer to weigh in.) With slumps being so common, it shouldn't come as a surprise that salespeople get into slumps too. In this article, we'll explore what causes salespeople to get into slumps, what their slumps look like, and how can they be fixed.

In baseball, the sport I know the most about, slumps are often the result of poor mechanics, where the player gets away from doing things that work. My 13-year-old son is in a hitting slump right now. He hasn't been keeping his weight back, resulting in his being way too far in front of the pitch, taking unbalanced swings, dropping his hands, and pulling his head off the ball. It's not unusual, as you can see from the image of Yankee's star Alex Rodriguez, pictured above. My son had a game-winning grand-slam on Saturday, but he uncharacteristically struck out in four of his seven weekend at-bats. It's not his first slump and it won't be his last, but the time during the slump can be difficult as he deals not only with fixing the swing mechanics, but also with the frustration and discouragement of a slump.

In sales, slumps can also come from poor mechanics, where salespeople get away from doing things that work. Some slumps occur at the bottom of the funnel, when deals that were expected to close either don't close at all or are awarded to a competitor.  Slumps can also occur at the top of the funnel, when salespeople experience difficulty converting calls to meetings. Slumps can even occur in the middle of the sales cycle when reps struggle to get traction or velocity with their new prospects.

Regardless of the timing, the causes for a slump can usually be narrowed down to 2 possible categories.

In the 3 scenarios above, the most common cause is rushing, when salespeople hurry to reach a milestone they are comfortable with or an outcome they wish to achieve.  

The other possible cause is laziness. Sometimes the slump is less about converting an opportunity, and more about not having anything to convert. Sometimes salespeople get away from prospecting, asking for referrals, and following up with contacts that at one time weren't ready. 

If this behavior continues for just 90 days, and the salesperson has a 3 month sales cycle, the sales manager won't realize there is an issue until 3 months after the laziness has begun. At the same point in time, the salesperson finds very little in the monthly commission check. Assuming that the laziness is corrected, it will take 3 more months before new opportunities move through the sales cycle, close and produce commissions again. A six-month problem!

How do you fix a sales slump?

Slowing down, listening and asking more questions will usually help salespeople solve sales slumps that arise from rushing.  But just like baseball, you need to practice doing it the right way. And as I learned in short game school, practice makes permanent!

One advantage of a modern opportunity-focused CRM application, a formal, structured, milestone-centric sales process, an up-to-date sales methodology, and on-going sales training and coaching is that each is a reminder of the fundamental things that work. It is far easier to slump without these resources than with them. However, the single biggest resource that can prevent a slump is....

...the sales manager. Daily accountability and coaching are the two most important things a sales manager can do to head off slumps before they can happen.  

Don't get me wrong. I am not saying that a proactive sales manager that practices accountability and coaching will replace the resources I just mentioned. No way. They are a package. They must go together! You need a proactive sales manager, and the right CRM, sales process, sales methodology and training.

Pull these things together to minimize the slumps and maximize the sales!

Topics: Dave Kurlan, sales process, sales methodology, sales pipeline, sales slump

A Guaranteed Fix for Inaccurate Sales Forecasts

Posted by Dave Kurlan on Tue, Sep 15, 2015 @ 06:09 AM

The weather has become quite predictive - if you want to know what it will be like in say, an hour.  Meteorologists are still fairly accurate within 24 hours, but for the most part, especially where I live in New England, they are challenged to get it accurate beyond a day in advance.

Think of that in terms of your pipeline, forecast and budget.  We know that forecasts are notoriously inaccurate, but that's when you're looking at the forecast for the month, quarter or year.  Meteorologists would never be accurate if attempting to predict temperatures, precipitation, cloud cover and storms a month in advance.

Are your expectations completely unrealistic when you attempt to forecast sales for the month or quarter?  For most companies, inaccurate forecasts are the norm and expectations for accuracy are insane.  But that's when companies rely on CRM applications that fall victim to any of the following 10 challenges:

  • It was designed for customer service rather than sales.
  • It has a contact or customer focus rather than an opportunity or sales process focus.
  • It was over-designed with too many features.
  • It is not user friendly.
  • Salespeople hate to enter information into it.
  • It's too easy for salespeople to manipulate the likelihood of closing.
  • Sales Managers do not regularly inspect opportunities for accuracy and appropriate stage.
  • Pipeline is a state of being, not a gap analysis.
  • Pipeline is a report rather than a staged, visual representation of the business.
  • Salespeople don't live in it and it hasn't become an essential part of the sales culture.

There are dozens of CRM applications out there.  While some are very well-known, like Salesforce.com, others are very obscure.  Well-known doesn't mean you should use it at your company - it might not be right for you.  Obscure doesn't mean that you shouldn't use it at your company - it might be perfect.

In the end, regardless of features, if the salespeople don't embrace it, then it will be a failure.  We have so many clients that bought CRM applications that aren't being used as expected, it's embarrassing.  Yet moving to another CRM application seems like throwing money out the window and admitting that your initiative was a failure.

On the other hand, companies think nothing of changing copier brands - even in the middle of a lease, they change banks when terms or relationships make it necessary, executives move in and out of cars every two years, homeowners cycle through crappy landscapers, we upgrade our phones, tablets and laptops every year or two, and we never think twice!  Why is it such a nightmare to move to another CRM application?

Moving is really not that difficult.  The problem is that it cost a lot of money to customize the first application, get everyone trained, and input all of the data.  There is a huge fear that moving to another application will be just as difficult as the first go-round.  But that's more fear than reality.

For example, we moved a client from a popular CRM application to a more useful and appropriate application.  They did spend and waste a fortune on the first one, they did spend months entering data, they did go through a long and drawn out training program for users and it was a monumental failure.  However, moving to the new application was a easy as pie.  It needed almost no customization, had no complicated navigation, and an hour of training had everybody up and running. The data was imported, not entered manually, and the salespeople love it so much they are not only using it, but embracing it.

The best news of all comes in the form of the client's results:  

  • Salespeople are living in CRM!
  • Opportunities cannot be arbitrarily moved forward in the sales process.
  • The likelihood of closing is calculated based on reality, not hope.
  • 100% adoption translates to real time, accurate data in the dashboard.
  • Salespeople see their pipeline stage gaps and proactively respond to them.
  • Forecasts are accurate.
  • Everyone is happy.

It's not that moving to a better CRM application is a new cost or even difficult - it isn't!  It's that for most, walking away from the initial investment of money, time, emotions, commitment and your bad decision is so hard.  But it's not a divorce, it's more like changing banks.  You move away from one that no longer suits your needs and begin working with another that you perceive to be better.

Do you need some help sorting out your CRM situation?  Just shoot me an email and I'll steer you in the right direction.

Topics: Dave Kurlan, sales pipeline, salesforce.com, sales forecast

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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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