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Are We Underperforming Our Potential?

by David Brock on July 27th, 2021

It’s the end of the quarter, we’ve hit our numbers. We take a moment to celebrate, high 5 each other and revel in the success. And hopefully, we repeat the performance the following quarter, then hit our numbers for the year. We’ve met our goals!

But what if we could have done more? Not just exceeding our quotas, but what if we reassessed what we do, how we do it, and realized that we really should be doing much better? That our goals actually were too low.

Recently, I wrote that Buying Is Broken. The majority of buying journeys actually end in failure. The customer abandons the project and doesn’t change. If we are making our numbers, in spite of this high failure rate on the part of customers trying to buy, couldn’t we actually be achieving far more than what we have achieved? If we helped our customers become more successful in their buying efforts, we could drive even more business.

At any time, only a minority of customers that should be buying are actually buying–or attempting to buy. But the majority may be so busy just getting through their days. Alternatively, they may not be aware that they could/should change–that there are opportunities for them to improve and grow. What if we incited them to change.

Too often, we are so focused on hitting our numbers, that we miss the real opportunity and can grow even more than the goals we have set for ourselves. What if we recognized that the potential is far greater than our goals and put in place strategies to seize that opportunity–or to set far higher goals?

There’s the dark side of underperforming the potential.

Let me walk through a very typical example. Not long ago, I was sitting with an executive team. We were looking reviewing their performance. We looked at the prior quarter forecast–they had committed to make $1 Billion for the quarter–and they made their number (high fives all around). But then I started looking at how they had made the $1 B they had committed:

  • At the beginning of the quarter, they had put together a forecast for the $1B. They identified the opportunities they would win to achieve that goal.
  • At the end of the quarter, we found about 50% of the deals they forecast actually came in.
  • 20% of the deals they forecast slipped into a later quarter.
  • Close to 25% of the deals they had forecast winning, they actually lost (Hmmmmmm)!
  • To close the gap, they started scrambling, they increased upsold some of the committed deals, increasing the revenue from those. They pulled opportunities from the following quarter into the current quarter–some of that involved offering big incentives. They scrambled to find new opportunities they could close quickly (e.g. upsell, cross sell to current customers).

We looked at previous quarters and started noticing the same patterns, they were reasonably consistent in hitting their numbers (or getting very close to them). But the way they made their numbers was always very different than the way they planned to make their numbers.

We recognized no forecast will ever be perfect, but we started asking ourselves some questions:

  • How could only 50% of what we thought would happen actually happened? What happened to the other 50%, how could we be so far off?
  • How can we be losing so many of the deals that we had committed we could win? What were we doing wrong? What could we do to win those deals–or at least have a more realistic perspective of our likelihood of winning?
  • While the number of deals that slipped was relatively small, what could we do to minimize the slippage?
  • The biggest issue was, the team had “found” opportunities to close the gap. They were able to move deals forward, they were able to create new deals, they some how made things happen to hit the number. Why weren’t they doing this as normal behavior? Why weren’t they looking at moving those forward all the time, not just to fill a hole in the forecast? Why weren’t they forecasting these?

We saw the same thing quarter after quarter. We recognized that while we were hitting the goal, we actually were underperforming the potential. We could actually sell more!

Now, I’m not arguing that we set outrageous or unrealistic goals. But what I am suggesting is that while we are satisfied with hitting our numbers, it’s important to look at how we are making them, exploring the question, “Can we or should we actually be doing more with the same resources?” 

What if we could help more customers succeed in their buying journeys? We are already investing the time in working with them, but maybe we are focusing on the wrong things?

What if we incited more people to buy? What if we could create a higher sense of urgency to do something now?

Are we performing as well as possible in the deals we have qualified and are pursuing?

Are we achieving our full potential? Are we growing at the rate we should rather than doing what we can?

Afterword: This was originally published on July 14, 2021. Due to a site error, all July posts were lost. I am republishing them. Thanks for your patience.

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