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Oct 15 19

Deal Strategies, Helping The Customer Buy

by David Brock

Recently I wrote, “What If We Kept The Target Close Date Sacred?” It focused on improving our pipeline management, discipline, and integrity.

But the way we address these issues is in our deal strategies and how we engage the customer in each deal.

Most of the time and too much of our training focus on the things we must do to sell our solutions to the customer. We qualify them, we identify their needs and priorities, we understand who’s involved in the decision, who the competitors are, and develop plans to get the customer to select us. We politely address all their concerns, handle their objections, present our value, and seek to convince them we are the best solution.

Typically, we project a target close date (usually based on what we want to have happen and not what the customer needs to have happen). We assess a probability of winning, usually based on where we are in the selling process and very little on customer verification.

And then we cross our fingers, hoping we can keep the customer focused and choosing us.

Unfortunately, it’s not very helpful to what the customer is doing in their buying process. The customer’s biggest issues are not with solution selection. In fact any solution on their short list is likely to solve their needs.

The customer struggles with a lot of other things. They struggle with aligning the diverse agendas, motivations, priorities of the people involved in the buying process. They struggle with an increasing number of people involved in the decision. They start and restart their buying journey, they go back and revisit/re-do old issues, change their minds, change their priorities, get re-directed by their management, and go back to “Go” without collecting $200 (a Monopoly reference too many no longer recognize).

They are focused on other things than selecting a solution, after all, they aren’t really on a buying journey, but rather they are seeking to address a business opportunity, solve a problem, improve their internal operations. Solution selection is a small part of what they are facing, and probably the easiest part.

They are worried about risk, business and personal. They are worried about the decision, are they making the right decision, are they making the best decision, what happens if they don’t?

And, 53% of the time, they fail to complete their buying journey. They fail to address, or choose not to, the business issue and opportunity.

And the deal falls out of the pipeline, NDM, or it slips and the close date moves, and moves, and moves. We aren’t achieving our goals because the customer is failing to achieve their own.

What if we changed our deal strategies, focusing on how we work with the customer to help them navigate their buying and problem solving process? What if we helped them identify the need and urgency of changing, establishing a goal of when they want to have a solution in place?

What if we helped them understand the risks, the uncertainties–perhaps not reducing it but helping them become more confident that the actions they are taking are the right actions?

What if we leverage the tools they use for these kinds of projects–develop and execute a collaborative project plan? What if we used project management principles to help them achieve their goals, what they set out to do on the schedule they originally set for themselves?

Doing these things would seem to maximize customer success—and, by the way, maximize our success!

We would develop more focused, collaborative strategies. We would reduce the NDMs, closing more opportunities. We would have greater predictability on the deals and when we will close the deals.

Somehow this seems to address our most critical issues in selling, while simultaneously helping the customer achieve their goals.

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Oct 10 19

What If We Kept “Target Close Date” Sacred?

by David Brock

Just finished one of those “aha” conversations with a client. Thought I would share the concepts with you.

One of the things I pay a lot of attention to, as I review pipelines or deal strategies, is the Target Close Date, and how many times that date has been changed.

I believe sales people should do everything possible to:

  1. Identify the most realistic target close date possible.
  2. Do everything possible to keep that date sacred.

Sadly, most target close dates seem to be unrealistic and meaningless. They are driven by what a sales person (or their manager) wants or needs, but have little to do with the customer need to buy.

Then as the customer embarks on their buying journey and we execute our sales process, as things get delayed, as priorities shift, the target close date shifts and shifts and shifts…..

Some years ago, I was looking at a major deal at a client. It was a huge deal, it would make the client’s quarter. Yet as I looked at it, the target close date had changed 11 times in 11 months—the pattern was at the end of each month, the sales person would slip the target close date 30 days. The sales person had no idea when the customer would make a decision and just kept slipping it, thinking, “Hopefully they will make a decision next month.”

How do we keep the target close date sacred?

First, we set the target close date incorrectly. We set it based on what we want or need, perhaps tempered by our experience. For example, we have an average sales cycle of 90 days, so we arbitrarily set the target close date 90 days out.

The target close date needs to be driven by the customer need to buy! It must be driven by understanding, with the customer, when they need to have a solution in place and what the consequences are of missing that target date.

Ironically, this is part of qualifying an opportunity. We have to know this stuff to have a qualified opportunity! We have to know this stuff to help the customer navigate their buying process to achieve their goals when they need to achieve them.

Second, we know things slip. The customer may shift priorities, they may lose their way in the buying process (hopefully we are minimizing that through our coaching), unanticipated barriers emerge. The plan the customer and we put in place falls apart.

But this isn’t new news, it happens all the time both in buying situations and in normal projects the customer undertakes. But if we and the customer continued to slip our deadlines, we would never achieve anything.

The buying/selling journey is a project. And to manage projects effectively we need to put strong project plans in place. In developing strong project plans, we typically identify milestones or stage gates, we look at the critical paths, we build some buffer into the plan, so that we are more likely to hit our goals.

But stuff happens, and we get behind schedule. There’s the temptation to slip the project completion date, but then that slip has huge consequences to the customer. They may miss a product launch commitment, they may miss customer commitments, they may not have the support systems in place to support a major change. They may be in violation of a law or compliance issues. Any slip has serious consequences to the customer and their ability to meet their goals/commitments.

We need to use the same tools and processes in helping our customers in their buying journeys. We need to help them keep that target completion or close date constant—after all, we’ve already identified the consequences to them for missing it. We need to help them rethink their buying process to keep them on target with achieving their goals.

Great project managers recognize this. As they see project plans slipping, they don’t slip the target completion, if they possibly can avoid it. What they do is adjust their project plan. They start at the target completion date, keeping that constant, and work backwards, changing the project plan to meet their goals.

Of course things will slip due to things outside the customer’s and our control. But our job, with the customers, is to minimize this, to help the customer manage it, to focus on the customer’s abilities to achieve their goals.

It really isn’t that tough, project managers do that all the time. It’s nothing new, though I suspect this type of thinking is new to most sales people.

Again, we are most effective when we:

  1. Establish a realistic target close date based on the customer need to buy.
  2. Working with the customer doing everything possible to keep it sacred.
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Oct 8 19

The Pipeline Review

by David Brock

I was meeting with a client, we were doing the first pipeline review as part of their implementation of the Sales Execution Framework. Pipeline reviews are a great starting point for the process, a good pipeline review helps identify and isolate potential challenges as well as the performance leverage points.

The client was a very large company, the current pipeline had thousands of opportunities. They had always done pipeline reviews—I suspect a number of the managers were thinking, “Why are we doing this, we do them all the time–isn’t there a better way to identify our performance leverage points?”

But they were really struggling to meet their numbers, performance was way off and they didn’t know why. Their mantra of “doing more” wasn’t working. They needed to figure out what the real performance issues were.

Starting out, we focused on pipeline quality and integrity. It’s impossible to understand pipeline health if it’s filled with garbage.

First, we looked at deals with passed due target close dates. 6% of the opportunities in the pipeline had target close dates that were 90-450 days in the past. When I asked, “What’s happening to those, are they still real, why aren’t they updated,” no one knew the answer, they had to ask the sales people what had happened.

Next we looked at deals that had been in process an abnormally long time. The average sales cycle was about a year. 10% of the opportunities had been in process for 3 years or more. While it was a small percentage, 12 opportunities had been in the pipeline for 10 years–never moving.

Next we looked at overly optimistic close dates. We already knew the average sales cycle was about a year. We looked at opportunities that had just been qualified, 15% had unrealistically short sales cycles–sales people were estimating sales cycles of less than 60 days—25% of what was the normal sales cycle.

In 30 minutes, we had discovered at least 31% of the pipeline opportunities were inaccurately represented in the pipeline, or even not real. We went through other issues, in an hour, we discovered a number of issues. For example while their average deal size was over $1M, over 50% of the opportunities in the pipeline were less than $100K. Only 1% of the qualified opportunities had plans in place to move the customer to a buying decision.

We adjourned. The managers had to go to their people to clean up the pipeline. There were too many quality/integrity questions to really understand the pipeline and to begin to address performance issues.

When we reconvened about a week later, they had cleaned up the pipeline. 27% of the opportunities that had been in the pipeline, were eliminated as bad opportunities or opportunities that were wishful thinking.

The numbers were grim. There wasn’t enough volume to make their numbers. There were some velocity issues. The number of opportunities less than 10% of their average deal value was still very high.

But now we could begin to identify the problems and begin to develop solutions to those. As grim as it looked, we were able to develop an action plan to improve performance.

Three months later, we got together again. Yes there were some integrity/quality problems in the pipeline, but it was only a few percent. More importantly, we were starting to see pretty dramatic performance improvements. We had found more efficient ways of handling the low value opportunities, freeing people to focus on the high value opportunities–this alone changed the pipeline dynamics and the number of opportunities needed to achieve their numbers.

Forecast accuracy improved dramatically, they were no longer allowing opportunities that were wishful thinking into the pipeline. Win rates were improving, both because they were focused on higher quality opportunities, but every opportunity in the pipeline had a close plan in place, that was kept updated in regular opportunity reviews.

Cleaning out the pipeline made the performance problems obvious, enabling the management team to work with sales people to improve performance. Those problems had always been there, but management couldn’t “see them” because of all the garbage and clutter in the pipeline.

We always need to deal with facts as we assess our own performance or that of our organizations. Clouding them with garbage doesn’t help, in fact it masks the issues preventing us from facing reality.

However bad a situation might look, when we focus on reality and the facts, we can always figure out solutions and a path to recovery.

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