Answer These 4 Questions To Guarantee Sales Pipeline Accuracy
When the end of the quarter is approaching, what do sales managers want? Easy answers. Which sales that their people promised will close this week? And if not, why not? When will they close? Here are 4 questions that sales managers can ask to test for sales pipeline accuracy.
The Pipeline Is The Lifeline Of A Company
I believe a robust pipeline is the key to success 99% of the time. It is the lifeline of the company. To predict if the company will meet its numbers, look no further than the pipeline. Right? That’s assuming that the pipeline is accurate. But is it?
Don’t Over-Promise and Under-Deliver
Sellers must first build their pipeline, then ensure as much accuracy as possible in the numbers they offer. Then the sales manager is responsible for communicating the combined pipelines of their team to upper management.
It’s common for sales managers to trust some of their folks’ numbers but may find others not so reliable. In other words, the problem is with those salespeople who are too optimistic, then over-promise and under-deliver.
Asking The Tough Questions Versus Having An Interrogation
A key component of a manager’s role is to work with their salespeople to manage and report their pipeline. Trust in your people is paramount and that happens over time.
But there is a fine line between asking questions to ensure accuracy of the pipeline and turning it into an interrogation. Tough questions may be necessary with those that have a weak pipeline and are trying to hide behind poor activity.
Four Expectations You Can Set To Ensure Pipeline Accuracy
As a sales manager I believe there are four expectations you can set with your salespeople to ensure pipeline accuracy and predictability.
How Long Has The Deal Been In The Pipeline?
First, how long has this opportunity been in the pipeline? If it has been forecasted for six months or more, what is holding it up? How often is the salesperson meeting with the customer?
If a sales opportunity is to move forward, the salesperson should be in regular contact with the decision makers ensuring they have all the information they need to make their decision. Customers can be cautious on moving forward since change is always risky.
The larger the price tag, the more risk there is. Managers wonder, “Will this decision deliver the needed ROI?”
Is Procurement Involved?
Second, is procurement involved and what are their needs before they’re ready to say yes? Do we need to sign their contract which is a part of their criteria for doing business?
I have seen many deals derailed near the end of the sales cycle when the customer announces that everything is fine and now, we need to get procurement involved. Well, that can add another three months to closing the deal. Procurement doesn’t need your solution.
What they need is to follow their way of measuring their success, which is getting the best discount possible and having the vendor sign their terms and conditions. This can lead to a huge delay. The salesperson needs to ask if procurement or purchasing will be involved in the decision.
Do We Know All Of The Decision Makers?
Third, how many sales calls have been made with that customer and do we know all the decisions makers? I once worked with one decision maker and met with that person once every two to three weeks.
In the SPIN selling approach by Neill Rackham, he mentions that every successful sales cycle needs to have sales calls that end with an advance and not a continuation.
An advance moves the sale forward. It includes gaining another level of commitment, meeting another decision maker, and moving the sales forward.
You want to see that they are involved, which is a good sign of their level of commitment. My contact, the Vice President of Information Technology never showed me those signs. After meeting for about three months, he left the company.
The opportunity I was working on was dead. I had no other contacts inside of the account and when I tried to approach his replacement, she wasn’t interested in meeting.
She had her own preferred suppliers and biases on who she wanted to work with. The key is to meet as many decision makers as possible who would be willing to champion your solution.
What Was The Latest Communication With The Customer?
Fourth, what has been the latest communication with the customer? What is their response to questions about the slow timeline?Have you summarized the value of your solution and does the customer agree with you?
If the customer is avoiding you, or if you hear radio silence, don’t be optimistic. You have a problem. Either your solution is not a priority, they were kicking tires for a price comparison, or they have their “go to” partner they want to do business with.
Your pipeline will be much more accurate when communication with the customer is on a regular basis, and the discussion leads to concrete information on decision makers, timeframes, contract needs, financials and terms of the agreement. When the customer gets back to you every time you call, you should feel confident that they want to work with you and that you are providing good value.
Answer These Questions For More Accurate Forecasting
The bottom line is we learn to forecast sales opportunities based on the experiences we have had in the past. We should let management know with confidence, that we have the latest information to assess when a deal will close.
To be confident, ensure strong communication, knowledge of all the decision makers, and whether procurement is involved. Then look at how long has the opportunity been around, and how many sales calls are being made. Together the answers to these questions will lead to greater sales pipeline accuracy and better forecasting.
Sales teams that share the experience of reading Fanatical Prospecting together are much more likely to break free from the fear and frustration that is holding their team back from effective and consistent prospecting. Download the Fanatical Prospecting Book Club Guide to learn how to fill your pipeline, fast.
About the author
Stu has spent over 25 years in sales management, sales and sales training with…