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What Is A Strong Pipeline?
One of the toughest behaviors to change when salespeople are working to transform from being peddler to becoming Demand Creator, is the relationship they have with their pipeline.
Having been taught (consciously or otherwise) that sales is a numbers game, peddlers always feel better when the pipeline has more opportunities in it. As salespeople move up the value chain, they gain an understanding that the quality of an opportunity is far more important than the quantity.
This leads to a pipeline that feels weaker, and it increases the fears associated with the the necessary change in behavior and mindset. While the pipeline is actually becoming stronger, it doesn’t feel that way..
In 20+ years working with salespeople and sales management, I’ve learned that there’s little reality in most pipelines. While there may be many “opportunities” listed, few of those opportunities are real. A couple of years ago we conducted a comprehensive pipeline review with a new client’s sales team. The review started with 59 opportunities from 4 salespeople.
When we were done we discovered that 5 were bona fide opportunities, 7 had little to no chance of closing despite the fact that the company was about to invest several thousand dollars of man hours and expenses to prototype a solution, in 33 of them the sales rep was clearly talking to the wrong person and the rest were no better than a lead you could get from a newspaper.
The focus on quantity in the pipeline leads to several bad behaviors, such as:
- A lot of valuable time is wasted chasing the wrong opportunities or even the right opportunities, but with the wrong people.
- Reps lack the time to adequately invest in the right opportunities and places to build the business case and move beyond price.
- Pipeline reports become jokes within management circles, and businesses (especially small and mid-sized businesses) lack the critical intelligence needed to accurately assess their position and make adjustments in a timely and effective manner.
- An urgency mindset, instead of an importance mindset, is built; preventing salespeople and organizations from making the necessary changes to control their destiny.
Demand Creators firmly believe that all progress and growth begins with an honest picture of reality. They realize that focusing on fewer, high quality opportunities is the key to standing out and escaping commoditization.
Making the transition from a pipeline with lots of names on it to one with fewer can be quite scary, and it’s necessary to achieve the effortless growth you desire.
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4 Responses to “What Is A Strong Pipeline?”
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Doug's Washington Business Journal Columns- Intelligent Growth Articles
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Quality over quantity – got it. However, you make it seem like it is an easy switch to make. Who wouldn’t want to fill their pipeline with less opportunities that all had a better chance of closing?
The question is how do you get enough quality leads so you don’t feel the need to just get a lot of bad ones so your pipeline looks full.
I would maintain that your pipeline MUST have a lot of opportunities in it, but that the majority of them are only there for a brief time. My sales philosophy at kickasssales.net is Effort + Curiosity + Ability to Make Connections = Kick Ass Sales. This falls under Effort.
You have to actually make an effort to work the opportunities in your pipeline. The problem is most sales people find solace in seeing a million dollar pipeline. It is easy to ignore the truth that the same pipeline will only yield a few sales when the excitement of the “potential” is so big. Consequently, the sales person stops putting in the effort that will result in opportunities falling out of his/her pipeline to avoid the eventual truth of impending poor performance.
It’s not about having more quality opportunities. No one can control that. It is about working the opportunities you have so the good ones flow through the pipeline and the bad ones fall out. Lather, rinse, repeat.
There is no such thing as “effortless growth” or everyone would be doing it. The satisfaction of growth is seeing your effort pay off.
Mark,
Thank you for engaging and for you comment. You share a lot here, and I’ll do my best to respond:
First, let me try to address your issue about my use of the term “effortless growth.” Anyone who’s ever played a sport and been “in the zone” or hit that perfect golf shot knows what I mean by “effortless.” I coach college baseball and I work with my hitters all of the time to get them to understand that their swings should be effortless. Admittedly, it takes a lot of hard work to make anything effortless.
Now to your other points. By no means am I saying that the transition from a quantity approach to a focused approach is easy. Quite the contrary. It’s one of the hardest mindset shifts there is.
Also, the size of the opportunity is only one part of measuring quality. I would rather have 5 real $100,000 opportunities than 1 fake $1,000,000. I’m addressing the need to focus and dig, and to build wide support within a prospect’s organization as you build the business case. Don’t get me wrong, if you’re focused on selling commodity products then you absolutely need to brings lots of opportunities into the front of your pipeline and filter them out quickly. Demand Creation is not the right approach for commodity selling. However, if you’re looking to move beyond price, and you want to create value and expand margins – you must be able to be more selective up front.
And, while I love your point about curiosity I completely disagree that we have no control over the quality of opportunities we can work with. The reality is that we have a tremendous about of control. That’s what being a Demand Creator is all about.
Doug,
Thanks for explaining your use of “effortless growth.” That makes sense.
Because we focus too much on all the intricacies of the process we are in the middle of (look at the ball, lead with your hands, transfer your weight, open your hips, etc.), we lose sight of the outcome we are trying to achieve (swing the bat to get a hit). Don’t think about your swing, get in the box, do what you’ve practiced (that’s the effort), and go get a hit. If what you are doing doesn’t feel natural, it won’t be effortless, but doing some things the right way can’t feel natural without a lot of effort and practice.
Love your point about commodity selling in regards to pipeline. Question. My competitors actively try to make my product a commodity. That’s how they take my customers — they tell them I overcharge because they don’t need all my “fluff.” I sell OTMP (Organization, Time Management, and Planning) tools and training to schools, whose budgets have been slashed by 20-30% in the last 4 years, so price is a compelling argument. The “fluff” argument is compelling, as well, because only 10% of people plan (only 3% write their plans down) so my customers/prospects do not have a personal sense of value for what we do — they like the idea, see the benefits, buy a planner as part of a New Year’s Resolution but don’t always give it weight, aka “fluff.” Advise?
Lastly, my point about lack of control over quality opportunities is probably a communication breakdown over pipeline verbiage. I would argue that approaching a business is putting them in the pipeline. You can do all the homework and still get a dud or miss a gem. It’s out of your control to know until you actually sit down with them and find out their needs and how they match up with your solutions. I consider that process as part of the sales pipeline — qualifying the opportunity. Since you have no idea how that qualifying will turn out, you have no control over the quality of what goes in your pipeline.
Mark,
It’s hard for me to advise with knowing a bit more (feel free to send me some details off line), but I’ll do my best.
Whenever a salesperson’s focus is on their product, service or “solution” the focus is on the commodity – whether that’s intended or not. As a result, the approach is ripe for the type of competitive pressure you refer to.
The key is to move beyond your solution, and instead focus on the problem that you’re solving. In essence, you have to make your solution a prescription drug. What’s the consequence if your customers and prospects don’t benefit from what you do? How will that consequence impact the results your customers’ need?
You’re not in the OTMP business as much as you are in the change management business – your tools support critical changes needed that can allow schools to get results with fewer resources. As your sales and marketing approach moves to provoke and educate your prospects/customers on these issues, your conversations stop being about products – and your competitors can no longer commoditize you. You go from being a good salesperson to a trusted & valuable resource.
One final note, you’ll notice that I emphasized marketing in the last paragraph. Marketing’s #1 job in B2B and B2G sales is to educate and provoke customers on their problems. Unfortunately, marketing is failing in this effort putting far too much emphasis on the sales function. Make sure your marketing function is supporting your sales effort. Let me know if you want some ideas on how to do that.
All the best,
Doug