Last week, I wrote about Pipeline Flow and Velocity. A good measure of the flow is to look at the sales cycle in days, and whether opportunities are stalled in certain stages. But the sales cycle is one of the most powerful personal productivity metrics available to sales people. Focusing on reducint the sales cycle can dramatically improve productivity.
Two tools for compressing the sales cycle are your sales process and the sales call plan. Let’s look at how we might leverage each to drive tremendous reductions in the sales cycle.
The Sales Process (or from the customer perspective the Buying Process) is the set of key activities we and our customers go through to help them make a buying decision. As I develop and execute my sales strategy for each opportunity, I look for every opportunity to compress the cycle. For example, my sales process may look at a number of key activities my customers need to go through to make their purchase decisions—and the complementary activities I must undertake to win the business. You can think of these almost as a checklist. As I look at this checklist, I think, “How many of these items can I get accomplished in my next encounter with the customer? If I’m planning a meeting, these activities become my guide to information I need, or that my customer may need. They guide me on what I need to get accomplished or the people that may need to be engaged.
Using the checklist as my guide, I try to see, “how many of these things can I get accomplished in my next meeting?” I try to be very aggressive, structuring the meeting to accomplish as much as is reasonable. For example, I might think, “If I can get another customer to participate in this meeting, I could accomplish these additiional things, reducing the number of meetings I must have.” I used the process as my guide to planning the meeting and activities I undertake with the customer. As much as possible I try to accomplish as much as possible in as few meetings as possible.
Now here’s the “gotcha.” If you don’t have a strong sales process, it’s impossible to do this. You can’t systematically analyze an opportunity, compare it to your best practice/experience, and figure out how to compress the sales cycle into few calls. Without a strong sales process, you are guessing, or worse, reacting. It’s impossible to manage the sales cycle time if you are doing either of these.
So we use the customer’s buying process and our sales process to develop a plan to execute the activities in as few meetings and steps as possible.
The next step in compressing your sales cycle is to look at the sales call plan itself. The activities in your selling process provide a framework for compressing the activities into as few calls as possible. But we want to go one step further. We want to plan and structure our meetings to accomplish as much as we possibly can. Then we want to execute the meetings very well.
A few years ago, we did a research project. We looked at over 1000 sales opportunities. We interviewed the sales people, analyzed data, and in many cases interviewed customers. We found that sales people made as many as 3 times the calls required to close the deal.
Here’s a simple test for yourself. How many times do you walk out of a call and while you are headed back to the office, you think, “Oh I forgot to ask this!” If you answer “Yes,” you’ve extended your sales cycle.
Our customer interviews showed more, customers said sales people weren’t prepared, they weren’t knowledgeable, they wasted a lot of time. All of these increase our sales cycles, as well as annoying our customers tremendously. Planning your sales call, preparing for it, executing it well has a dramatic impact in reducing your sales cycle.
Here’s a real example. I once was coaching a sales person on her deal strategy. It was for a very large opportunity–the contract value was more than $40 million spread over about 3 years. She had spent 6 months trying to get an appoinment with the CIO of the company. The meeting was scheduled, and we were planning the meeting. We went over all the things that needed to be covered in the meeting. I asked her, “What do you think the CIO will be concerned with?” She didn’t know, but took the time to make some calls to get some insight. When we got back together, she said he wants to know this, that, and this. Additionally, he may ask about references.
She was well prepared to handle everything but the references. I asked her what she was going to do. She replied, “If he asks, I’ll tell him we have lots of outstanding references, and that I will get him a list.” We explored that. If she did that, she would have to get him the list, then follow up with him, then possibly arrange another meeting to get his reactions, then follow up with another meeting. Given that it had taken her 6 months to arrange this first meeting, she faced the possibility of extending her sales cycle through many other meetings over a much as another year.
I asked her, “Is there another way you might deal with this?” She thought for a while, “I can bring a list of references to provide him, in case he asks.” That was good, it could reduce the cycle and the number of meetings. But I pushed a little harder, “Is there something else you might consider?” She thought a little longer, she said, “I know this company really watches Company X, they like what they do. They happen to be a very good customer of ours. Maybe I could get someone to call them before our meeting to tell them their experience with us.” What an awesome idea! She did this, a key customer at the reference account, called one of the key people at the company. We invited that person to participate in the meeting with the CIO. When the CIO asked the question, the customer executive said, “We’ve already spoken to so and so at company X, they raved about the products and services. We also spoke with several other references and found the same thing.”
In one meeting, we were able to address all the concerns the CIO had. Because we had planned the meeting, anticipating what he would ask and need, we were able to compress into that single meeting, something that may have required more meetings and many more months of time into that meeting. The sales rep won the deal within a few weeks following the meeting.
Here’s another example I run across all the time. A sales team is preparing for a closing call. They have a great presentation, a powerful value proposition. They’re ready for a great closing meeting. As I review the meeting, I ask, “Is the key decisionmaker participating?” You’d be surprised at the number of times the response is, “No, the participants will take the presentation to the decisionmaker.” How can this be a closing call, why don’t we change the structure of the meeting to include the decisionmaker? If we don’t, we added more meetings and more time to our sales cycle.
Reducing the sales/buying cycle is one of the most important things you can do to increase your productivity and improve performance. The two key things you need to reduce the sales cycles is a well structure sales process to help you identify areas in which you can compress the cycle, and well planned and executed sales calls.
Try this on your most important deals. You’ll start seeing dramatic reductions in your sales cycle.
Afterword: We’ve developed a sales call checklist–a tool to help you plan powerful sales calls and reduce your sales cycle. If you want a free copy, just email me at firstname.lastname@example.org