When Deals Stall……

When deals stall it’s a sign that something has to change!

All of us have experienced stalled deals.  It’s frustrating, we’re anxious for the customer to move forward in their buying process.  We’re anxious to close the deal!

Deals can stall for all sorts of reasons.  Customers may lose their sense of urgency.  Their attention may have been diverted to other priorities.  They may simply get lost in their buying process.

I review hundreds of deals and pipelines every year.  I see thousands of stalled deals.  Too often, the deals are stalled because of sellers!  Let’s dive into some of the most common reasons I see deals stalling.

First, how do we know a deal may be stalled?  When a deal seems to be taking longer than our past experience has been.  We should have the data on:  The average buying cycle, once a deal has been moved into the qualified pipeline; of the average time deals spend in each stage of the qualified pipeline.  We have data on this, we can look at it by deal type, customer type, offering, any number of ways, but this data gives us insight into deal velocity and movement in the qualified pipeline.   Some things to think about in looking at average deal cycle.

1. I’m only focused on sales cycles for qualified deals.  The sales cycle is most meaningful when we focus on customer committed opportunities.  Above the pipeline, there may be huge variation in the time an opportunity may need to be nurtured.  While we may track the time involved in doing this, often that number isn’t terribly meaningful.
2. The sales cycle metrics are based on deals that have gone through the complete sales cycle.  They have moved from qualified to closed won/lost/abandoned.  Too often people try to assess sales cycle metrics by looking at the live pipeline, assessing outliers based on the live pipeline.  But we can only assess sales cycle by looking at completed deals.  Ideally, we know when they were qualified, how many days they stayed in each stage, when they were closed.  From this, we can determine the “normal” time in stage and complete cycle for from qualified to closing.

Every sales/buying cycle will be different, so there will be variances from the average.  What we are focused on are deals that seem to be taking an abnormally long time.  When we find a deal that seems suspicious, we want to dive in to understand what may be causing the slowness or delays.  Some delays may be legitimate, based on the customer situation.  However, too often, we see stalled deals that have been left that way by seller inattention.

It’s stunning how many qualified deals I see in pipelines that have been in that stage, 2-3 times more than normal.  Sellers and managers don’t dive in to see what’s happening and why.  Few things can destroy the validity of our pipeline health metrics more than deals that aren’t moving.  The pipeline can’t be healthy if we have the right pipeline coverage, but the majority of deals aren’t moving.

Why do deal stall?

1. They weren’t real in the first place.  Sellers may have been enthusiastic about a deal, may have thought through sheer force of personality they could convince a customer to buy, or just moved a deal into the qualified pipeline to meet their coverage goals.  The first thing we have to inspect in our pipelines is, “Are they qualified!  Are they real, is the customer committed to a change?”  Some can be disqualified and abandoned outright, some need to be moved out of the qualified pipeline and nurtured until the customer has a high sense of urgency for change.
2. The customer and seller have failed to establish a project plan.  Customers don’t know how to buy complex B2B solutions.  Unsupported, they tend to wander, shift priorities, start/stop.  One of the most important things sellers do in creating value with customers, to establish and document a project plan.  Start at the end, when the customer must have a solution in place.  Work backwards to help the customer develop their plan to make a decision to meet that deadline.  Identify key milestones, things the customer must accomplish, things we need to accomplish, and how the customer can move forward.
3. As we and the customer execute the project plan, things come up, milestones may be missed.  As a result the project slips, and slips, and slips.  Eventually, it may just be abandoned.  Again, our customer struggle to buy and to execute their project plan.  We can offer great expertise in helping them stay on target.  We can leverage the urgency the customer has in having a solution in place by a certain date.  But if we haven’t established these with the customer, we have no way of getting the customer back on track, and the project will continue to slip.
4. Sellers aren’t paying attention.  The number of qualified deals I review in which there has been no customer engagement in the past 30 days is stunning!  If this is an active, qualified deal, there will and should be frequent engagement with the customer.  And this has to be meaningful engagement, not just a “how are you doing” checkpoint. Each qualified deal must have next steps and an action plan–ideally aligned with the customer project plan.  In reviewing opportunity plans, each qualified opportunity must have the next steps in moving the project forward, and we must make sure it’s aligned with.  If it doesn’t have this plan, it’s stalled.  If there hasn’t been any meaningful customer engagement in the past 30 days, it’s stalled.
5. We fail to recognize that qualified deals may become “disqualified.”  The need or urgency to make a change/solve a problem has disappeared.  Or it’s been de-prioritized.  We keep them in our qualified pipeline, when they should be moved back to prospecting and nurtured, or they should be closed and abandoned.  Recently, I spoke to a sales manager about a deal I saw in his team’s pipeline.  It had been in process for 7 years, 14 times the average sales cycle!  The sales person kept hoping something might happen, keeping it in the qualified pipeline, even though there was no real interest on the customer’s part and no significant activity.
6. Sales people gaming their pipelines.  Managers tend to focus on pipeline coverage, “If you don’t have 3X you won’t make your number.”  They keep potentially dead deals in their pipelines forever, just to achieve the 3X goal.  Alternatively, sellers game their win rate.  If they never close a deal as lost, it will not count toward their win rate.  As a result, pipelines get bloated with garbage.

Deals may slow down for good and bad reasons.  It’s our jobs, as sellers, to help the customer get back on track, to help them move forward in accomplishing their goals.  We and they can’t continue doing the same thing, we have to change something!

Afterword:  Below is the AI based discussion of this post.  It’s very long, but hang in there.  To be honest, it’s much better than this article.  Enjoy!