Overview
Results
Fitness
Means
Proactively Manage Pipelines
Sales
Predictability
Customer
Relationship Quality
Producing Sales Revenue -- Proactively Manage Your Pipelines
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Sales
productivity* and performance are functions of the fitness
of the practices applied -- to both developing each sales
opportunity, and to proactively managing each
pipeline.
To
raise the actual amount of revenue/profit/customer
relationship quality produced per-person per fiscal period,
these four elements are essential to maintain and improve
together:
-
effectiveness
of sales process, tools, resour- ces, rules, and execution
-
sales pipeline
flow management
-
sales opportunity
quality
-
sales opportunity $size
Without
proactively managing each of these four elements, it's possible
for close rate, cycle time, average opportunity size/
quality, and discounting all to improve -- yet over the
same period have a decline in actual sales revenue produced
out of the pipelines!
If so, the 1::4 lever could work in
reverse -- i.e. a "-5%"
decline in revenue could effect a "-20%"
decrease in P&L
profit (see 1::4
Sales Productivity ). |
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Fitness Foundation to Develop Sales Opportunities and Proactively
Manage Pipelines
First,
the sales team defines
the high level, common sequence of stages for the
pipeline's sales cycle process. All
opportunities of all salespeople then move through
these same stages. The sales team maps in their
current best-practices, tools, resources, executing and
forecast estimating rules.
This serves as the standard operating foundation for all
involved in executing or supporting the selling cycle.
Then,
with the pipeline's
sales cycle process in place, the flow of all opportunities going through
it can first be estimated, then measured as an actual
benchmark. By calibrating flow, the sales team shares a
single, clear understanding of what potential revenue
volume each will need to maintain in his/her pipeline
in order to continue producing their assigned monthly revenue
targets.
Annual territory revenue targets have productivity
increases built into them. Properly managing the
pipeline's flow means keeping it 100%+ full
and flowing on its cycle time (plus 3 &
4).
Even
so, deteriorating opportunity quality -- allowing
"garbage" to come into the pipeline/process
-- can easily lead to:
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more
fall-out and less closings (lower close rate)
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lengthening
of the cycle
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higher
discounting, giveaways and special terms
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|
hockey
stick end-of-quarter revenue bulges
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| decreasing
forecast accuracy
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poorer
customer relationships
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fewer/weaker
customer references
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less
account expansion and retention
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As
well, if the average revenue $size of opportunities in
the pipeline decreases, so may revenue productivity.
And, if the average $size increases, close rate and
productivity may also decrease if the current sales process, tools,
resources, or execution aren't as effective in the larger
accounts arena (or effectiveness of Professional Services, Customer
Support, etc.).
. . .
Sales Predictability
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*Sales
productivity -- the amount of revenue/profit/customer
relationship quality produced per person, per
fiscal period -- out
of the total costs (selling resources applied; sales, marketing,
tech specialist, reference
account, field and HQ management time
invested; discounts, giveaways, special terms made; etc. ).
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