Welcome to The Pipeline.

The Unexpected Sales Holiday1

bad holiday

A few years ago I wrote this for a newsletter, and a friend reminded me of it over the weekend, saying she always remembers it around this time of year, and this year especially due to the added challenges in her market. I hope you see something in it too.

TS

As the holiday season approaches, sales professionals run the risk of scheduling another unexpected holiday in February or March, depending on the length of their sales cycle. Sadly, this income holiday is easily preventable with a little planning.

Let me explain, even under the best of circumstances, prospecting is something sales professionals hate to do, even more so if it involves cold calling. Let’s face it, sales people view cold calling as a punishment to be avoided. As a result, we find any number of excuses to avoid this torture, some truly creative. During the holidays, there are a range of seasonal excuses to add to the ordinary. If you add the office, client and family parties, and prospecting becomes just too easy to neglect and avoid.

When February rolls around, the hang over hits where it hurts: in the commission. Say you have a ten week sale cycle; meet a prospect for the first time on November 1st, it will close January 10th next year. Assuming you get your commission monthly, you’ll get paid out February 2005. If you meet a client November 24th, it will close February 2nd, payout March 1st; and so on.

Most sales professionals give into the holiday spirit sometime around mid-November. There are a number of reasons for this. With many companies having a December 31st year end, there is a big push on “closing” business now. And in many instances, the lack of prospecting that results from this is condoned and overlooked by sales management, because after all, “everyone is out closing business”.

With prospecting slowing down through the latter part of November, and almost completely forgotten in December, sales people seem busy, managers seem happy as business is closing, but what happens after December 31st, when the parties are over. Well in most cases the first week of January still allows for a hang-over, but then there is nothing you can do to avoid the commission drought if you have a ten week sales cycle. Even if you can accelerate to eight weeks, you’re not going to see a close until March and a payout till February. What’s worse is the cycle perpetuates itself, since in March your manager is going to want some closes to make the quarter. Yes, you know it, no prospecting in March…., next thing you know its June and…..

Then there is the common belief (among common sales people) that people don’t want to see anyone this time of year: “you just can’t get people to see you in December, they’ll just push you off to next year”. The truth is that it’s exactly this type of thinking that leaves an opening for those who stick with the process regardless of the time of year, regardless of what the crowd is doing.

I have found that December is a great time to see prospects for a number of reasons. One is that there are less sales people calling on them and they are willing, almost curious to see a sales person who professionally cold calls them that time of year. With their own activities winding down or focus on a strong year end, and planning for the year to come, they are willing to take the time to listen to ideas and offerings that aid their endeavors. Often what you sell will be needed by them in the new year, and with the lead time for implementation, the decision needs to be made in November-December to have impact right from the start of the year. And if they don’t have surplus budget now, it’s close enough to the new fiscal year (and delivery) that terms could work for them and you to seal the deal now.

The reality is if you ask most sales people it’s never a good time to prospect, Mondays are bad, March break, summer vacations, and right back to Christmas. But if you talk to great sales people, they always prospect, every day, every month, every season, because they know they have to. If they don’t replenish their prospects, they’ll be nothing to close at the end of the cycle. So don’t let the holidays delay your efforts, and you wont have to deal with the delayed consequences.

Sell well,
Tibor Shanto – The Pipeline

Cost of “Group Think” in Sales2

one jump

As you know Friday I delivered another session of the Ultimate Appointment Making Workshop in Markham Ontario. This is something that is very different from my normal interaction with sales teams, and as a result I always learn some new things that help me when I work with my clients. The key difference that struck me this time was the impact of “group think” on sales people and the impact on their learning.

In the room on Friday there were at least 20 different companies represented from all corners of B2B sales; and with that came a wide range of views, challenges, and attitudes. This was a much more dynamic workshop than most delivered for groups that all come from the same company.

It was refreshing to see how individuals were willing to challenge others in the room, not in a vicious way, but in an attempt to understand the topic at hand, and making sure they take everything out of the day. It was refreshing to see how participants were willing to open up and expose themselves for the sake of improvement.

When you contrast that with some of the posturing and attitudes and time wasting you sometimes encounter with groups inside companies, I began to think about what if anything was behind the experience with the two groups.

Inside companies, you get the typical challenges of any primal group. Aside from the leadership, you always have the alpha dogs, the “experienced” old timers; you know the ones that know it all, because they have had the same year for the last 15 years. You also get the ones who are either open to the learning or are struggling and want the help but sit like wall flowers due to the social structure of the sales team and their role in it. Clearly it is our job as facilitators to overcome this and help create a safe zone where those who want to learn and practice can, and marginalize the interfering “know it alls” who silently bully the others.

It is not a surprise in some ways, the folks at the workshop Friday for the most part paid their own way and were looking to improve themselves and were committed to success. Instead of sitting around blaming the economy for everything, they were stepping up and meeting things head on.

The “group think” phenomenon is a cancer that limits the impact of training and change beyond the workshop, the peer pressure on those wiling to change is real in a lot of companies, at times even from front line managers. We see his during the follow through Action Plan sessions we have. When these are one on one, it is easy to encouraging the willing and segregate the unwilling. But it rears its ugly head in group encounters.

Beyond the social and morale impact on the workshop and follow up sessions, there is the economic impact on companies that look the other way when “group think” raises barriers to learning and improvement. Imagine the increase in revenues if the “experienced” reps were to actually change their approach and their performance as a result. Add to that the increase from those willing to learn and change but are reluctant due to the social realities of sales teams.

On the up side, what I took away from Friday is the need to redouble the effort and focus to positively challenge the unwilling, to engage them to take their negative energy and refocus what they “know” (as in “know it all”), on helping them get over their insecurity about learning something new while not making them feel like they were wrong for doing things the way they had been to date, to involve them in helping those willing to learn.

I want to thank those who came with an open mind on Friday, and those who bring an open mind every day, for helping to reenergize me in the process of helping them.

Sell well,
Tibor Shanto – The Pipeline

Economic Contribution0

Applause

Another successful session of the Ultimate Appointment Making Workshop was delivered today in Markham. A full house of sales professionals took their appointment making skills to the next level.

The world is now at the mercy of these newly certified top gun appointment setters.

Monday they will be out filling their pipelines with new prospects enabling their companies to avoid the fate of many in this questionable economy. Their companies will be focused on delivering orders rather than contemplating bailouts, handouts and other outs.

Here is what these top guns were saying at the end of the day:

“Very good workshop on strategically putting together an effective cold calling process. Tibor shared very valuable tools, techniques that everyone can use in the real world. Thank you”

“Great workshop and information. Great selling tactics”

“After finishing this session with Tibor I feel confident that my numbers will improve. I’m excited to see my sales hit the sky. Thank you.”

“I found it very useful and thoroughly enjoyable”

“A very enjoyable day – A worth while session”

“Thank you for your clarity on how to effectively make calls to book appointments”

“Great insight on correcting “old” habits that are impacting effectiveness”

“Excellent! Lots of practical information that I can start using now.”

Thank you all for a great day.

Fear not, the workshop will be coming to a town near you soon, visit www.salesleadersseries.com soon.

Sell Well,
Tibor Shanto – The Pipeline

Great Discoveries2

telescope

Had the pleasure this past week of discovering a couple of great blogs you should all visit regularly. The first is Dr. Jim Anderson’s The Accidental Negotiator. Jim was kind enough to comment on a recent post I had on the Sales Bloggers Union blog (much more on that to come). My post looked at the over dependence by some sales professional on negotiations, the post was titled Side Effects of Negotiations.

As a result of Jim’s comment I checked out his blog, and was immediately impresses by a great post: Top 10 Secrets To Make A Negotiation Work Out For You! A great read all sales professionals will benefit from.

The other discovery is exciting in a couple of ways, he is Will Fultz, check out his Top Sales Blog. Will brings unique view on sales shaped and grounded by the reality of his day to day success as a leading sales professional living the experience and sharing his views and best practices. This is further validated by the fact that Will is the latest member of the Sales Bloggers Union. You will recall we announced the group a couple of months back, and now the group is in full swing, visit the site and enjoy, and keep your eye posted here for some important announcements coming from the Union very soon. I am pleased to be collaborating with Will and look forwards to exchanging sales knowledge with him and the other experts making up the union.

Sell well,
Tibor Shanto – The Pipeline

When Should You Walk Away From a Deal?1

walk away

Now!

The second that question begins to form in your head you should be prepared to walk away now.

That is not to say that you shouldn’t perform a thorough evaluation of options, examine how the deal can be altered or restructured, but once that question appears, no matter how faint, and how deep it is in the canyons of you subconscious mind(s) you have to confront and accept it. Sales people have a tendency to ignore the obvious and loud voices in their heads. How many times have you wanted to ask the obvious question but did not for all the wrong reason, and then have come to regret it. How many times have you taken a deal when you should have walked, and then have come to not only to regret it, but have it distract you from other successes?

To accept it does not mean you lead with it, but it does have to go at the top of the list. Every other option has to be weighed against it in the cold light of day. This is perhaps the hardest thing for most sales people and in fact most sales managers to accept.

To be able to do that you do have to have a process of evaluation, much like having minimum qualification criteria, you need to have minimum standards an opportunity has to meet in order to stay in play. What concessions are being asked to make, what impact on current margins and future margins, what resources will be consumed, what is the opportunity cost, were they a marquee account, how much of a drag on resources, and how distracting a client will they?

Even with that it is not easy, but consider the pain of the alternative. First and foremost, your time; any time you invest in chasing deals that are bad or weak or should not happen, is time taken away from finding alternative prospects, time from driving good proposals that will close. As we have written about in past posts, time is your capital for success.

One of the key reasons for ignoring the voice is the plain fact that most people do not have enough real opportunities in their pipeline. Most VP’s will tell you that even when the “quantifiable” prospects exist in a pipeline, their fear that the “quality” of those prospects is at a level where they can have confidence in enough actually materializing. So the decision becomes skewed by the fact that if you walk away from this one, then there is even less of a hope.

I ask people at this cross road a simple question: if you had lots of good prospects, more than enough to hit quota, would you be thinking about how to salvage a bad deal or simply move on to the next one. If the answer is move on, then I recommend you walk away and put the time and energy into finding a new opportunity.

One of the real upsides to deciding that walking away is an option is the clarity of thought it gives. Once you prepare yourself for life without this account, the process turns to evaluating whether they are truly worthwhile as an account. Because if it doesn’t make business sense, it surely doesn’t make sales sense.

This is a lesson I learned from a great sales person, we’ll call DN. I accompanied him on a renewal call to a globally known communications equipment manufacturer; this was an account I once had that he was now managing. Before the call we played out the scenarios, we agreed that the account had lost its lustre and profitability even with the amount of revenue they potentially represented. We both individually came to the conclusion that if the account was to go away, it would be better than having it under the terms they were proposing for the renewal.

The discussion with the client was cordial but not productive, they were making very unreasonable demands, threatening to pull the account unless we made concessions, and when the account represents over a million dollars, it is usually an effective threat. But DN had plenty of prospects, he had a clear line of thought and a sound plan as to how he would make up for the lost revenue if it came to that, and as such was not rattled by these threats. He had a plan, and he was confident in his stance. The client was puzzled; DN was not looking like he was going to capitulate as other sellers had, he was not even perspiring. About a half hour in to the meeting, the client almost frustrated that her bullying had not worked, asked DN “well if you are not prepared to deal under these terms why are you here today?” DN’s reply was straight forward, relaxed polite and accurate answer: “I am here to see if I can afford you as a client.”

From that point on the question was how well did the alternatives to losing the deal stack up against the other options. To DN’s credit, a deal was struck, a mutually good deal, but one that was struck because he was willing to walk away.

Walk Well,
Tibor Shanto – The Pipeline

Recent Readings and Musings11

Seems everybody is on about time, just as we finished a series of posts about time allocation, managing activities, and time’s impact on sales, prospects and sales professionals. So it was with interest that I read the following post at AskTheManager.com, Time Management Blogwatch – November 9, 2008. Not surprising, time after all is the big equalizer, or destabilizer, depends where you position yourself.

Another hot topic these days is cold calling, some say it’s dead, some say it has been reborn, others say “why me?” I think it is like what Frank Zappa said about jazz, “it’s not dead it just smells funny!” Of course the ones that say it is dead are the ones who are not getting results. Could it be that the way they are making the calls is causesing it to smell funny? One battle cry is that it is ineffective and not successful, and the leap, the conclusion is that executives don’t like cold calls, so why bother. I tend to go with those that realize that done right, cold calling is still one of the most cost and time effective means of reaching executives. The issue is how you do it, and for the patient ones there are a lot of good blogs our there for input; but you have to do the work. As for the others, the ones who have sworn off, I respect and thank you for leaving it to those that profit from it.

The other fun reading these days is all about recession proof selling; selling in a slump; one has to wonder if it is the economic slump, or a sales slump, which happens to some at the height of the market, and happens to most when they weren’t selling during the boom but rather taking orders. I guess orders drying up are a sign of recession in sales, and having to apply your craft is a depression? A lot of really good stuff, but as you read it you come to realize that good selling is good selling recession or otherwise. My question is, do we have the sales masses revert back to what they were doing before the recession once the economy picks up. Because if the answer is ‘no’, then it leaves us with the fact that there is no replacement for proper selling regardless of what the weather is doing outside.

But with all that said and done, don’t forget to take time remember those that fought so we can share these musings freely.

poppies

Sell well,
Tibor Shanto – The Pipeline

Doggin’ It8

bird dog

Not by design, but this week a number of the discussions I had with prospects/clients had to do with front-line sales managers. This is a good thing since for a long time I have been a firm believer that the biggest bang for the buck in sales improvement training is at the front-line manager level of the organization. While each of the organizations was very different in terms of product and target markets, B2C, B2B, and while they all had different and overlapping issues, there was one they all shared. Their managers were all bird-dogging. We’ve all seen this practice, I’ll admit it, when I was first appointed as a district manager I did, and some VP’s of Sales encourage it.

In case you don’t recognize the expression, this is where the sales team goes out finds potential prospects. They execute a form of “qualification”, usually consisting of reciting highlights of the brochure (you want to save the best parts for a crucial moment), then when the table is set, the Manager comes in to Close the deal. This tribal ritual is played out daily in corporate offices around the planet.

In some ways you can’t blame some of these managers, often they are thrust in to the situation; you’ve seen it or read about it before. “George, you’re one of our best reps; we want to promote you to be the next sales manager” Screwed! George, the company the team, and lets not forget abandoned customers in George’s old territory. Actually the customers often do not suffer as much as the others, because George will soon be back, but with a new card, less time and a bit more distracted while he is trying to fill the open head count.

Now the pressure is on the manager not only to continue to hit quota in his old territory, but to help his team become like George, after all that’s why we made him the manager, he will show the rest of the team how it’s done, and manage and help them. Of course no one tells George how to do that so he figures the best thing is to have his people go out bird-dog for prospects, he will accompany them and show them how to close. Two birds with one stone, close deals and a sales clinic all in one trip. Let’s go!

Unfortunately this scenario is too real and played out too often, and we all know it doesn’t have to be. Many companies don’t have a formal transition path for reps they are promoting to management. Many have the Management by Osmosis approach. Some will tell you they have “A high potential” program that recognizes and preps them for their eventual ascent, but many of these are administrative in nature, and prepare the individual only for internal processes not life as a sales manager.

There are many programs out there that will help prepare the right person for the role. There are many threads on numerous blogs discussing the potential and the practicality of “good sales people” becoming “good sales managers”. (You can read through the discussions on www.salesmanagement20.com or http://thecustomercollective.com for some recent discussion around the topic).

Our experience has been that two areas have to be addressed for a successful transition. First the ability of the new manager to be able to understand and communicate expectations to their team members and identify challenges and gaps in the individuals’ ability to deliver to those understood expectations. Once there is mutual agreement on the gaps and the willingness to address them, there needs to be a mutually agreed to action plan to address these areas. These need to be objective and rooted in helping the team member properly and consistently execute the sales process. Focus is on execution of the process not about the individual and their “shortcomings”. This is where the second element comes in; coaching the individual to help them achieve their goals, both financial goals, and the goals of the immediate action plans that make up the coaching process. (BTW, this process works for building new skills in an already successful rep, just set realistic doable stretches and help them grow, it is not just for underachievers).

This is where many new (and old) managers fail, rather than coaching and helping the individual acquire the necessary skills and habits, the manager “shows” them how its done. The reps see but does not learn. The revenues is always within grasp and the manager would rather reach out and grab it, than use the opportunity to coach and mould the rep to be able to succeed on an ongoing basis. It is the age old drama of not tolerating short term losses for long term success in the form of a fully productive sales team, versus a team that sniffs them out, points and waits for the manager to shoot.

Manage well,
Tibor Shanto – The Pipeline

My Time Is My Money and Money Is My Time2

Over the last few posts we have looked at time and its integral role in sales, looking at time not just as a non-renewable resource, but as a tender: Time is The Currency of Sales. As a successful sales person you can extend that thought further by understanding its impact on, and for your prospects and clients. We talked about how a successful sales professional thinks of time as investment funds, and seeks to use “invest” that time in the most profitable way.

The same is true for our prospects and clients, but how they define good/safe investment is likely different than our definition. This of course is more pronounced early in the process, and as you mutually move through the sales cycle, the definitions become more aligned, and at the end you can say that a sale takes place when both buyer and seller see equal opportunity to realise ample and fair returns on their investment. As such one of the key focuses and measures along the way is the prospects willingness to “invest” time in the sale. If at any time the investment loses appeal, their “funds” will be redirected to safer or more compelling investments. Again, this is most critical when engaging, or trying to engage with new prospects. At that point the only question on the mind of the prospect is “do I want to invest my time in this conversation?” In English it sounds like “is this guy going to get my ‘money’, steal my ‘money’, or should I invest a bit and see where things go?” This is the case no matter how you first reach out to your prospect, be they warm leads, referrals, or cold calls.

If you do have to make cold calls as part of your prospecting routine, then you have to remember that no matter how good you are, you are a practicing interruption professional. We were not on their agenda, and we are looking to consume time they were preparing to use for other things, important things. Using our analogy, we are looking for them to redirect investment capital that had been already earmarked for other “investment vehicles” they believed would deliver a sufficient or even adequate return on that capital. While we are not exactly reaching in to their pockets and stealing time, we do have to understand that their time, investment capital, is in demand by everyone, and as such the prospect is going to be on guard, and concerned about wasting this non-renewable resource. This is where a lot of reps hit the wall; they confuse someone guarding their resources with rejection. But when you are prepared, you can change your approach to highlight the investment benefits of your alternative. It has to be in a language that the prospect can understand; it has to align with the prospects priorities; you have to help them see that you offer a viable, secure means to superior returns. Doable, but has to be done right, and when it is you will prospect successfully.

So remember, if you value you your time, and value the prospects time, you need to demonstrate that not by waving your value proposition, or client list, but a clearly articulated short form prospectus highlighting the superior return for their investment: time. Sell well,Tibor Shanto – The Pipeline

8,736, Your Maximum Number by Colin Wilson0

Today I am happy to have Colin Wilson, founder of Firstborder as a guest contributor. Colin expand on the theme raised in our post October 29th Yes – No – Maybe, looking at the impact of questionable prospects on pipeline management and overall sales success. The post presents valuable insights on the payoff of proper and honest pipeline management.
Tibor Shanto

8,736, Your Maximum Number

colin wilson

By Colin Wilson

Eight thousand seven hundred and thirty six… 8,736… that… is… it… the maximum number of hours you have each year to make your target… there is no more time… and that is because 8,736 is 24hrs per day, 7 days a week for 52 weeks of the year. In reality the time you have is a lot less… around 1,680 hours if you do normal hours or perhaps 3,000 hours if you are a workaholic without a family or social life. Time has to be your most precious resource, once gone never to be recovered.

So, if you want to hit or exceed target where do you want to spend your time… on deals that will close or one’s that lead you up the garden path… to the tyre kickers? If you are in sales then you will know there are only three main sales activities that you need to do… Fill your pipeline, Manage your pipeline and Close your pipeline… Fill, Manage, Close… simple.

However, where do you spend your time?… filling, managing or closing? If you try closing deals that are not ready, then you are wasting your time. If you are trying to manage a lot of deals then you will spread yourself too thinly and therefore your time is not being used effectively. If your prospecting techniques are not effective then you may be not filling the pipeline or filling it with the wrong type of deals… again wasting time. So, for many sales people a pipeline full of deals shows that not too much prospecting is required, but there is lots of managing to show activity and there is enough to close to make the number… looks like they are doing their job… another quarter secured in the job… even if target is not achieved.

Instead of sales, think of yourself as a football manager (soccer for our American cousins), but you do not have a squad of players, just the 11 required to field a team. You have 4 games coming up and your objective is to win just one game. However, all 4 games are going to be played simultaneously. So what do you do with your 11 players to meet your objective?… spread them across 4 games, 3 players against 11, or focus on the one game you believe you can win. As a football manager you would say focus on one game. In sales you would spread yourself across four games and dilute your resources so much you are unlikely to win anything. Less is more. Focus on what you can win and ditch the rest… they consume too many resources.

So why are pipelines so often full of deals that can’t be won?

As mentioned sales people need to look busy… particularly the poor ones as they lack the confidence of finding real deals to close so it’s good to have a full pipeline even if the deals are to all intent and purpose dead.

However, some of the sales people are actually so poor that they don’t even realise that they have dead deals and so live in eternal hope that the nice people will buy from them soon.

Sales people refuse to believe that they can’t close a piece of business and therefore foster the belief that while the customer is still breathing then they have a chance.

However, sales management are also often to blame… particularly those that insist that sales have 3 times their number in the pipe to make their quota. Sales are put under pressure to achieve 3x… so the pipeline gets filled… with anything. For me, any sales organisation that pushes the 3x thing… I immediately know they work a ‘spray and prey’ sales strategy and encourage the ‘walking talking brochure’ brigade.

The other problem that propagates too much in the pipe is forecasting based on percentages – factored forecasting – it’s at 30% @ $1m, therefore that’s $300k in the forecast. This method of forecasting promotes lazy sales management and last sales reps who hide behind numbers without making any
real commitment – and the numbers are manipulated to give the right answer anyway!

What should be done?

So, if you want to make your number you need to live in the world of reality. If you run a pipeline then you need to follow the way customers buy, not the way you sell. Sales reps need to show how they are going to make their number based on binary forecasting – win or lose are the only two outcomes in sales. You need to commit to your number by end of week 5 of the quarter… to be able to commit you need to be in control of the deal. If you can do this you actually only need 1.5x in your pipeline… the time saved by not chasing the no hopers gives you more time to manage, more time to close and more time to do quality prospecting.

If you are going to give up your ‘spray and prey’ sales approach… if you are going to stop working the numbers and chasing anything that breaths in the hope that they will buy… if you are going to work the binary forecasting method and only work the deals that you know will close… then the key to the success is having the right deals in the pipeline in the first place. Like everything, preparation is key and filling the pipe with the right type of deals will pay dividends in your ability to manage your business… and perhaps the 3,000 hour year can be reduced to 1,680 hours and so giving you time to get a life… maybe, just maybe… it’s worth a thought!

Colin Wilson is founder and owner of Firstborder, a sales training and consultancy company whose focus is on the individual sales professional rather than on sales organizations or sales teams. The reason is simple: when individual sales professionals succeed, the organization succeeds. Firstborder believes passionately that this approach sets us apart from companies and methodologies that seek to mould the behaviour of sales teams as a whole.

Firstborder’s tools and methodologies complement any corporate systems in place and simply recognise the fact that good sales professionals already maintain their own personal records for tracking sales and managing their business. The net effect is that Firstborder methodologies, skills development, and tools give sales professionals quicker and easier access to the control they need, not only to make their number, but also to forecast accurately – sales period after sales period.

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