Whether you’re a sales leader or CEO, holding regular sales pipeline reviews ought to offer an essential way of keeping your finger on the pulse of the business and giving you the confidence that revenue forecasts are likely to be met.
But as we all know, there are often frustrating gaps between the apparent potential of the forecastable pipeline and the resulting actual revenue performance. I want to suggest that part of the reason is that the wrong questions are being asked during the process.
And no, I’m not referring to the usual questions around “how much is the opportunity worth?” “what are the next steps?” “who is the decision maker” “what is the probability of winning?” and “when is the order going to be received?”
We need to eliminate unrestrained optimism
This is all useful information, but the answers you are likely to receive are all-too-often based on opinion or (even worse) unrestrained optimism and the desire to sell the sales manager what the sales person thinks they want to hear.
The problem with all of these frequently-asked questions is that they to very little to illuminate the opportunity, and they do nothing to confirm that the deal - by any reasonable assessment - is ever likely to happen at all.
It’s no wonder that so many confidently-forecasted opportunities are ending up with the prospect deciding to do nothing at all for the moment. In fact “no decision” has become the most common outcome in many sales environments.
3 critical questions
That’s why I urge you to ask the following three questions of every significant sales opportunity in your organisation’s sales pipeline, and keep returning to them to check that the situation hasn’t changed since the last time you asked:
1: Why does this prospect have to do anything?
The status quo (and the fear of change) is the most powerful restraining force in any buying decision. Put simply, unless and until the costs and consequences of staying as you are can are more painful than the costs and risks of change, your prospect is likely to stick with the devil they know.
If your sales person cannot prove that a decision-maker (and preferably a budget-maker) strongly believes in the case for change, and is powerful and influential enough to carry their colleagues with them, you should and must challenge whether the deal is real in the first place.
2: Why does this prospect have to act now?
Even if there is a compelling long-term case for change, unless there is an urgent reason to change now, the decision (and/or your order) risks being deferred. Some sales methodologies refer to this as a “compelling event”.
But the trouble with many so-called “compelling events” is that they are not actually very compelling after all. Some are even figments of the sales person’s over-vivid imagination. You need to understand - and you need to believe that your sales person understands - what bad things would happen within or to the prospect if they just let things continue on their current trajectory for the immediate future.
One last observation: your sales person’s once-in-a-lifetime, never-to-be-repeated discount offer for an order this month never, ever qualifies as a compelling event.
3: Why does this prospect have to choose us?
This is the last of the three questions you need to know that your sales person has mastered. They need to prove to your complete satisfaction that your company’s proposal addresses the prospects most important criteria in a provably different and superior manner to all the other options open to them.
Note that this isn’t just about out-performing your obvious competitors: it’s about out-performing all the options available to the prospect for solving the identified problem, including the risk they might decide to “do it yourself”.
If your sales person has done their job correctly, they should be able to not only articulate, but also provide believable evidence for, why the prospect, at both an emotional and rational level, is strongly predisposed to your company’s approach.
Justifying why the deal is real
One final observation: most sales managers ask their sales people, at some stage in the process, to justify why any given opportunity should be in the pipeline. I’d encourage you to turn that logic on its head, and ask your sales people at regular intervals to justify why any given deal ought not to be removed from the pipeline.In other words, instead of presuming the opportunity should be included, your sales people should expect to have to justify to you why any given opportunity should not be excluded. It’s amazing what this simple shift in perspective can achieve.