Just about anyone in sales knows about the Sales Pipeline or Sales Funnel. Like a wrench to a mechanic, or a ledger to an accountant, it’s the basic tool of the trade. Who knows when it first emerged, but it’s safe to say it was some time ago! So, how’s it doing in today’s world? By most measures, not too well. Considering that over 80% of sales deals don’t close as expected, and that around 50% of sales professionals are not attaining quota, something is wrong with this basic of tools.
The fundamental premise of the sales pipeline is that there are levels, steps, or stages, of the pipeline that traditionally equate to the steps of a sales process. A sales opportunity at stage four is further along the sales pipeline than one at, say, stage two. Maybe it’s at the “Proposal” stage versus the “Discovery” stage and there is a natural inference that it is closer to closing. Well, this is a myth in today’s buyer-driven world. It’s a myth to believe that we can take a buyer through our sales process and they will end up buying. The only process that concludes with a buyer buying is the buying process. It no longer matters where you think you are in a sales process. Just because you may have completed your discovery and presented a proposal to a prospect, doesn’t mean they are that much closer to buying. They may not even be in a buying journey.
The disconnect between the sales process and the buying process is the root cause that leads to opportunities not closing as expected and, indeed, a basic lack of integrity in the sales pipeline. In today’s buyer driven world there is little correlation between where you may be in your sales process and where the customer is in their buying journey.
The good news: this is very easy to solve – well at least on paper. It may be more difficult for sales organizations to flip something they know so well on its head and start looking at things from the Outside-In™, but that is exactly, and all, that is required. Stop thinking of those layers in the sales pipeline as equating to the stages of the sales process and start thinking of them as the stages of your market’s buying process. Then, stage gate them. For each of these stages, define clear and observable actions, behaviors, or events that you could test for, or observe, that would lead you to know that a particular prospect has completed that stage. If you haven’t yet mapped your market’s buying journey, use a generic one. Just like the old sales process, it’s not as effective as using your own market’s buying journey, but its better that nothing (if you don’t have a generic buying journey to hand, e-mail me).
Now, you have a sales pipeline that is tied to the stages of your market’s buying journey. The stages of this Outside-In sales pipeline now reflect the stages of the buying journey. For example, all opportunities at stage four may represent buyers that have gained budget approval, alignment from their decision committee, developed a detailed implementation plan, and have selected your solution over all others. This then gives a clear indication of where that opportunity is in the pipeline and an explicit picture of what needs to happen next. Say goodbye to the gamesmanship and subjectivity of placing sales opportunities in a pipeline based on an internal sales process. By adopting this flipped Outside-In approach and focusing on the buying journey, you are going to find that you gain the ability to both manage and forecast the business in a superior way.
Try it. You may find that many opportunities move backwards in the pipeline and some may drop out altogether. As shocking as that may be, you will have a much more accurate view of your business. You will find that your forecast becomes far more accurate and your win rate will increase almost magically. This dramatic impact on your results is simply because you are now monitoring and managing opportunities through the stages of the buying journey rather than through a mythical and not relevant sales process.