Stop Basing Your Probability Of Winning Based On Where You Are In The Pipeline!
Yeah, yeah, we all know it’s how we’ve “always” forecasted probability and weighted our pipelines. Yes, for some reason all the CRM vendors “out of the box” implementation of the pipeline ties probability of winning to where you are in the sales process. But when are we going to stop this simplistic and flatly wrong thinking about the probability of winning a deal?
You know what I’m talking about. We have a prospect who returns our call, we immediately declare a 10% probability of winning, because our systems are set up like that. We have a couple of meetings, have qualified them, determined their needs, determined who will make the decision and who our competition is. Our probability of winning skyrockets to 50%, again because that’s what our systems say. Then in the simple step of presenting our proposal, our probability of winning is suddenly 70-85%–again because the system tells us to do this.
None of these assessments and probability weightings have anything to do with whether the customer likes what we are doing, cares about our solution, or even is interested in buying from us. None of these looks at what the customer thinks of our solution relative to the competition or the other alternatives they may be considering. The customer’s point of view means little when we assess our probability of winning–at least according to our CRM systems and current methodologies. All of these measure where we are in our sales process—we’re 25% through, 50% through, 80% through, until ultimately we are 100% through the sales process—but we haven’t won the business.
We all know that assessing our probability of winning based on where we are in the sales process is flat wrong, but I’ve never seen a probability assessment based on anything other than where we are in our sales process! When are we going to stop this foolishness? When are we going to base our assessment of our likelihood of winning based on the customer’s buying process, what they think of our solution compared to the alternatives, and the sense of urgency they have about doing something at all?
What is we did something outlandish? What if we started assessing our probability of winning based on what the customer thinks? Wouldn’t we be much better served if we started thinking about things from where the customer is in their buying journey and their assessments of the alternatives they are considering? What would we learn if we started basing our assessment of the probability of winning on things like:
- The urgency the customer has to change and do something different–and the level of commitment they have to changing?
- The understanding the customer has about what they want to do and how well our solution enables them to achieve their goals?
- The customer’s assessment of what alternative best fits their needs–ours, the competitor’s, doing nothing?
- Our relationship with the customer and their confidence in doing business with us?
- The customer’s ability to get support and funding from their management.
- ….and a whole number of other factors important to the customer in their buying journey.
Imagine how assessing our probability of winning based on what the customer thinks would change our forecasts? Imagine how periodically assessing our probability throughout the buying process might actually change how we sold and interacted with the customer? Imagine how, knowing what they think, we might adjust our sales strategies and activities to improve our positioning?
Maybe then, we would have a much more accurate view of our real likelihood of winning. Maybe if we had a good understanding of how we stood, we could take actions to improve the customer’s assessment of how we can help them achieve their goals.
Understanding our probability of winning based on a customer assessment, adjusting our strategies to improve things can be very powerful.
When are we going to change decades of bad thinking about the probability assessment? When are we going to start challenging our software vendors to provide tools that enable us to correctly understand our probability of winning and take action on improving it?
(If you want, we’ve thought about this a lot. I’ve some “starter” templates on assessing the probability of winning a deal based on where the customer is in their buying journey. I’d be glad to send them to you, just ask for them–firstname.lastname@example.org)
Interested in understanding more about assessing Sales Competencies? Ask for our free Sales Competency Starter Kit by emailing email@example.com with your full name, company and company email.