Our last blog post suggested five attributes of good pipeline management. Follow those suggestions religiously and you will meet your quota AND your forecast more consistently. But try as we might as individual contributors, sometimes we are not totally honest with ourselves. As sales managers, we might not be supremely confident with the forecast picture that has been painted for us. The following five questions can work for both the individual contributor and sales management to build transparency through the sometimes over-optimistic forecasts we might deliver!
(Assume that the sales process is built on the following progression: suspect is qualified to become a prospect who is pursued for the purpose of an appointment to conduct discovery in order to present a proposal and then close. Each bold point is a critical step in the sales process and marks an advance through the pipeline and subsequent forecast.)
1. When, where, how and with whom was the discovery appointment conducted?
Based on your sales process and sales cycle, this question will often reveal the opportunity’s true place in the forecast. For instance, if your average sales cycle is 60 days from appointment to close, and the appointment occurred 90 days ago, this opportunity is possibly slipping and may not even deserve a place in the forecast. Also, if discovery was not conducted with all the major stakeholders, then perhaps there is more work to do and a less optimistic forecast should result.
2. What is the “compelling reason to act” in the proposal?
In other words, have we clearly identified the prospect’s pain point(s) in the proposal and matched the feature(s) of our product/service to create a benefit, or compelling reason to buy? Often I hear, “well, we are less expensive” or “they don’t like their current provider”. I’ve met thousands of prospects who retained a more expensive product/service even when they didn’t particularly “like” the current provider because the provider presented benefits elsewhere. If I can’t get better compelling reasons than these replies, the opportunity is removed from the forecast.
3. Who is the key decision-maker? And how do you know?
This is my favorite! Mostly the reply is this, “Well my contact is because they told me they are.” Ugh. Everyone in business is a self-proclaimed decision-maker! If we were not, we would only be worker-bees. And the person who will sign the contract is not always the key decision-maker either. Identifying the key decision-making person or group gets more difficult with more complex sales opportunities. I like the Miller Heiman framework for help in flushing out who that person or group might be for the complex sales opportunity.
4. Who and what is your competition? How would the prospect rank you against them?
I have seen way too many 30-day forecasted opportunities swept away by the competition at the last minute. Here’s a classic reply to this question, “Well, nobody, they are only looking at us!” And another, “I didn’t want to ask for fear of bringing up the idea of shopping us.” This is capitalist America, where choice and the right and duty to pursue choice are king! You better bet there is competition, if not from a direct competitor, than at least from a decision to source the solution internally or to make absolutely no decision at all. If we have not nailed down this crucial factor, the opportunity has no place in our forecast.
5. How do you know the opportunity is closed without signed contracts in hand?
The deal is never closed until the ink is dry on your contracts. Or in some sales processes, the deal may not even be closed until the product/service is delivered. In most sales processes, there is still a long way to go between a “verbal yes” and the point at which your company measures it as truly “closed”. Ensure that your sales process and associated forecasting ladder maps each and every critical step between the “verbal yes” and eventual closing.
Over the last two posts, you now have a way to manage your pipeline and to test the validity of your resultant forecast. I hope it helps you to beat quota and forecast every time!!
Wednesday, July 7, 2010
Thursday, June 3, 2010
Five Attributes of Strong Pipeline Management
Strong funnel or pipeline management results in the best chance of forecasting your results accurately and your best chance at exceeding your quotas. As we say in our profession, it is one thing to miss your objective. It is yet another step and a serious miscue to miss your forecast too, in the same month or quarter. The seriousness of this offense will grow the more senior in sales management you become. Do it too many times and you may find yourself in the Accounting office!
Before I suggest the five best attributes or indicators of strong pipeline management, it is important to understand the terms used in pipeline management. I see pipeline and funnel to be synonymous. Both are a depiction of each and every opportunity and its stage within your sales process (http://sellingwisdom.blogspot.com/2010/01/process.html). The stage-gate which the opportunity holds in your sales process should indicate its placement in the 30/60/90 day window since your sales process and average sales cycle should combine to become a predictor of time.
Your pipeline is not your forecast or “commit”, a term often used synonymously with forecast, although generally whatever is in the 30-day window should be your forecast or commit for the next 30 days. If at that stage in the sales process you cannot accurately predict its closure in the next 30 days, you should give consideration to placing the opportunity back into the 60 or 90-day window. Anything that could be signed in the upcoming measurement period, i.e. month or quarter, but is still somewhat tenuous in its placement along your sales process might be considered “upside” to which you are not willing to commit. Enough definitions!
Ok, so here goes. Here, from my experience, are the five best attributes or indicators of strong pipeline management:
•“The Good, The Bad, and The Ugly”. You can give good news late and bad news early. It gets real ugly if you can’t do either and you miss your quota. Even Clint Eastwood could not shed that reputation!
•“The Multiplier”. You have at least 2x, 3x and 4x your monthly revenue quota in the 30/60/90-day window respectively. Same can be said for the number of opportunities in each window, based on the average value of your sale. You need this buffer to protect against the unexpected. You have life insurance don’t you? Put those multiplication tables from the third grade to use!
•“Green, Yellow, Red”. From month-to-month, each opportunity moves at least from one window to the next (Green), never stalling more than 2-3 months (Yellow) in the same window. If the opportunity is stalling past 2-3 months, move it way back in your pipeline (Red). Where it is moved will depend on your sales process but I would suggest that since it is “Red” it is close to “Dead”. Find something new to work on. Better yet, ask for help.
•“Equal Opportunity”. Diversity, presented in terms of different companies or opportunities, products/services offered and revenue amounts associated, exists within the pipeline. Live by the elephant, die by the elephant if it decides to play elsewhere in the jungle!
•“Upside”. Forecast is at or near quota with enough upside to likely produce an exceeded-quota measurement period. Relying on the stretch of forecast only to get to quota is like asking for a quarter tank of gas to get you the manual-prescribed mileage for that quarter tank. Go get more gas, no matter the octane. Be safe with yourself and your passengers, i.e. your management!
So there you have it. Remember these five descriptors and paste them to your cubicle or PC/laptop for best pipeline management!
A word for sales management: if you have a closely defined sales process and stage-gates with specific criteria, and you combine this process and these stage-gates with careful probing of the sales person during forecast reviews and your first-hand knowledge of the prospect, you will meet your forecast almost every time. Just as important, you will quickly determine the sales effectiveness of your sales person, i.e. are they effectively executing the work necessary to fill the pipeline and advance opportunities, or are they “selling you on a bag-of-goods”. Many are sales people are good at the latter, far fewer are better at the former – these are our true Sales Pro’s!
Before I suggest the five best attributes or indicators of strong pipeline management, it is important to understand the terms used in pipeline management. I see pipeline and funnel to be synonymous. Both are a depiction of each and every opportunity and its stage within your sales process (http://sellingwisdom.blogspot.com/2010/01/process.html). The stage-gate which the opportunity holds in your sales process should indicate its placement in the 30/60/90 day window since your sales process and average sales cycle should combine to become a predictor of time.
Your pipeline is not your forecast or “commit”, a term often used synonymously with forecast, although generally whatever is in the 30-day window should be your forecast or commit for the next 30 days. If at that stage in the sales process you cannot accurately predict its closure in the next 30 days, you should give consideration to placing the opportunity back into the 60 or 90-day window. Anything that could be signed in the upcoming measurement period, i.e. month or quarter, but is still somewhat tenuous in its placement along your sales process might be considered “upside” to which you are not willing to commit. Enough definitions!
Ok, so here goes. Here, from my experience, are the five best attributes or indicators of strong pipeline management:
•“The Good, The Bad, and The Ugly”. You can give good news late and bad news early. It gets real ugly if you can’t do either and you miss your quota. Even Clint Eastwood could not shed that reputation!
•“The Multiplier”. You have at least 2x, 3x and 4x your monthly revenue quota in the 30/60/90-day window respectively. Same can be said for the number of opportunities in each window, based on the average value of your sale. You need this buffer to protect against the unexpected. You have life insurance don’t you? Put those multiplication tables from the third grade to use!
•“Green, Yellow, Red”. From month-to-month, each opportunity moves at least from one window to the next (Green), never stalling more than 2-3 months (Yellow) in the same window. If the opportunity is stalling past 2-3 months, move it way back in your pipeline (Red). Where it is moved will depend on your sales process but I would suggest that since it is “Red” it is close to “Dead”. Find something new to work on. Better yet, ask for help.
•“Equal Opportunity”. Diversity, presented in terms of different companies or opportunities, products/services offered and revenue amounts associated, exists within the pipeline. Live by the elephant, die by the elephant if it decides to play elsewhere in the jungle!
•“Upside”. Forecast is at or near quota with enough upside to likely produce an exceeded-quota measurement period. Relying on the stretch of forecast only to get to quota is like asking for a quarter tank of gas to get you the manual-prescribed mileage for that quarter tank. Go get more gas, no matter the octane. Be safe with yourself and your passengers, i.e. your management!
So there you have it. Remember these five descriptors and paste them to your cubicle or PC/laptop for best pipeline management!
A word for sales management: if you have a closely defined sales process and stage-gates with specific criteria, and you combine this process and these stage-gates with careful probing of the sales person during forecast reviews and your first-hand knowledge of the prospect, you will meet your forecast almost every time. Just as important, you will quickly determine the sales effectiveness of your sales person, i.e. are they effectively executing the work necessary to fill the pipeline and advance opportunities, or are they “selling you on a bag-of-goods”. Many are sales people are good at the latter, far fewer are better at the former – these are our true Sales Pro’s!
Friday, May 7, 2010
Is Selling The Same as Persuasion – Part II?
Let’s replay those definitions from last week’s post:
To sell:
“A recommendation to sell a particular security.
The process of liquidating an asset in exchange for money.”
To persuade:
“To prevail on (a person) to do something, as by advising or urging: We could not persuade him to wait.
To induce to believe by appealing to reason or understanding; convince: to persuade the judge of the prisoner's innocence”.
It is amazing to me how each definition is so narrowly defined. Sales Pro’s sell more than “securities” and do more than “liquidate assets”. I hope I never catch one of my Sales Pro’s liquidating assets! According to the definition of persuasion, one can only prevail “on a person”? I persuade my dog all of the time, through much urging, to use the bathroom outside. I must admit, I am not always successful.
Some big pieces are really missing here. “To sell” is more than a single act. It is a process, a series of steps, each step performed at an appropriate time with expertise, rigor and finesse (i.e. the art and science of selling).
Persuasion, as defined above, does not necessarily cover the sales process and therefore does not make selling and persuasion equal. Show me a sales person who, during the sales process, only “advises”, “urges”, “appeals to reason” and “convinces”, and I’ll show you a sales person who typifies the very low end of our profession, the ones who give us all a bad reputation. There is no room in persuasion for listening, empathy and probing, the very acts embodied in good selling.
Sure, there is always a point or two in the sales process where we may have to perform the act of persuasion, but persuasion is not selling. Selling is a far greater cause. It is a process that combines art and science, and a bit of persuasion here and there. If you throw too much persuasion onto your sales process, you will have thrown a bit too much flame on the beef and ruined a perfectly good steak. Selling is sometimes persuasion, but persuasion is never selling! What’s for dinner tonight?!
To sell:
“A recommendation to sell a particular security.
The process of liquidating an asset in exchange for money.”
To persuade:
“To prevail on (a person) to do something, as by advising or urging: We could not persuade him to wait.
To induce to believe by appealing to reason or understanding; convince: to persuade the judge of the prisoner's innocence”.
It is amazing to me how each definition is so narrowly defined. Sales Pro’s sell more than “securities” and do more than “liquidate assets”. I hope I never catch one of my Sales Pro’s liquidating assets! According to the definition of persuasion, one can only prevail “on a person”? I persuade my dog all of the time, through much urging, to use the bathroom outside. I must admit, I am not always successful.
Some big pieces are really missing here. “To sell” is more than a single act. It is a process, a series of steps, each step performed at an appropriate time with expertise, rigor and finesse (i.e. the art and science of selling).
Persuasion, as defined above, does not necessarily cover the sales process and therefore does not make selling and persuasion equal. Show me a sales person who, during the sales process, only “advises”, “urges”, “appeals to reason” and “convinces”, and I’ll show you a sales person who typifies the very low end of our profession, the ones who give us all a bad reputation. There is no room in persuasion for listening, empathy and probing, the very acts embodied in good selling.
Sure, there is always a point or two in the sales process where we may have to perform the act of persuasion, but persuasion is not selling. Selling is a far greater cause. It is a process that combines art and science, and a bit of persuasion here and there. If you throw too much persuasion onto your sales process, you will have thrown a bit too much flame on the beef and ruined a perfectly good steak. Selling is sometimes persuasion, but persuasion is never selling! What’s for dinner tonight?!
Tuesday, April 27, 2010
Is Selling The Same as Persuasion – Part I?
Did you ever buy a new car and then suddenly notice how many people on the road own your same make and model?
I was asked, in question form, the title of this posting during an interview recently and suddenly, I see the topic popping up everywhere on blogs and LinkedIn groups. So I thought I would add a nickel to the thought reservoir on this topic since my earlier “two cents” during the interview apparently was not enough to get the job. I am, after all, still writing this blog. Perhaps my “nickel of thought” will provoke a “dime of thought” from you!
Before engaging in a game of semantics, I consulted my trusty source of definitions on the web, Dictionary.com. The results were not inspiring. I sought out the verb definition of selling and persuasion, i.e. “to sell” and “to persuade”. Here is what I found:
To sell:
“A recommendation to sell a particular security.
The process of liquidating an asset in exchange for money.”
To persuade:
“To prevail on (a person) to do something, as by advising or urging: We could not persuade him to wait.
To induce to believe by appealing to reason or understanding; convince: to persuade the judge of the prisoner's innocence”.
Yecchhh. These definitions leave a Sales Pro wanting much more and feeling cheap. So it is natural then, to rest our response to such a question on the “art and science of selling”, the very premise of this blog!
So come back next time to “Part II” when I suggest that selling is sometimes persuasion, but persuasion is never selling.
I was asked, in question form, the title of this posting during an interview recently and suddenly, I see the topic popping up everywhere on blogs and LinkedIn groups. So I thought I would add a nickel to the thought reservoir on this topic since my earlier “two cents” during the interview apparently was not enough to get the job. I am, after all, still writing this blog. Perhaps my “nickel of thought” will provoke a “dime of thought” from you!
Before engaging in a game of semantics, I consulted my trusty source of definitions on the web, Dictionary.com. The results were not inspiring. I sought out the verb definition of selling and persuasion, i.e. “to sell” and “to persuade”. Here is what I found:
To sell:
“A recommendation to sell a particular security.
The process of liquidating an asset in exchange for money.”
To persuade:
“To prevail on (a person) to do something, as by advising or urging: We could not persuade him to wait.
To induce to believe by appealing to reason or understanding; convince: to persuade the judge of the prisoner's innocence”.
Yecchhh. These definitions leave a Sales Pro wanting much more and feeling cheap. So it is natural then, to rest our response to such a question on the “art and science of selling”, the very premise of this blog!
So come back next time to “Part II” when I suggest that selling is sometimes persuasion, but persuasion is never selling.
Thursday, April 22, 2010
"Sales and Service – Do They Mix? – Top Five Reasons Why"
There are certain things in corporate life that don’t mix well with Sales. Like Sales and Finance. Always seems to be a conflict there, i.e. “Why are you discounting the price?” Or Sales and Manufacturing, i.e. “Why did you sell it before we made it?” Or, my favorite, Sales and Marketing, “We paid for that lead, why can’t you convert on it?” While some might view this as conflict across the functional disciplines, I view this “conflict” as a healthy check and balance system for the corporate entity. It works if managed well by the senior leadership team. But what about the idea of Sales and Service? Are the two mutually exclusive? Should they compete with one another? Are they different disciplines?
My premise is this: Sales Pro’s should always be servicing, and Service Pro’s should always be selling. Dictionary.com defines Service as: an act of helpful activity; help; aid: to do someone a service. You are a Sales Pro, so you know how to define Sales. Can these skill sets be combined? I say they must. Here’s why:
1. Both Sales and Service Pro’s work with clients who have a need. No matter who we are, it is our job to fulfill it.
2. Prospects need to be assured that they will be serviced after the sale and judge that criteria based on their perceived level of service during the sales process.
3. Service Pro’s get the opportunity to engage with clients at a time of self-proclaimed need. After that need is satisfied, an opportunity presents itself to open up the conversation to uncover other hidden needs for an up-sell or cross-sell opportunity.
4. Sales Pro’s present and sell a solution that fulfills a need – is this not Service?
5. Interaction with a customer and/or prospect is a precious commodity. Sales and Service Pro’s are pressed up against the client or prospect and gain these interactions. Whether this interaction is for a sales or service purpose, it presents a wonderful opportunity to broaden the relationship. Take advantage!
I recently called my cable company for problems with a router. While they were quick to offer suggestions for a fix, they never asked me whether I was enjoying my experience with their offering. Like you, I receive marketing materials from them all of the time, only to toss them into the trash can or delete file on email. I am quite sure there are a couple of other channels out there that I have not heard of that I might enjoy, if only I had the benefit of a conversation. A lost opportunity for this provider!
My premise is this: Sales Pro’s should always be servicing, and Service Pro’s should always be selling. Dictionary.com defines Service as: an act of helpful activity; help; aid: to do someone a service. You are a Sales Pro, so you know how to define Sales. Can these skill sets be combined? I say they must. Here’s why:
1. Both Sales and Service Pro’s work with clients who have a need. No matter who we are, it is our job to fulfill it.
2. Prospects need to be assured that they will be serviced after the sale and judge that criteria based on their perceived level of service during the sales process.
3. Service Pro’s get the opportunity to engage with clients at a time of self-proclaimed need. After that need is satisfied, an opportunity presents itself to open up the conversation to uncover other hidden needs for an up-sell or cross-sell opportunity.
4. Sales Pro’s present and sell a solution that fulfills a need – is this not Service?
5. Interaction with a customer and/or prospect is a precious commodity. Sales and Service Pro’s are pressed up against the client or prospect and gain these interactions. Whether this interaction is for a sales or service purpose, it presents a wonderful opportunity to broaden the relationship. Take advantage!
I recently called my cable company for problems with a router. While they were quick to offer suggestions for a fix, they never asked me whether I was enjoying my experience with their offering. Like you, I receive marketing materials from them all of the time, only to toss them into the trash can or delete file on email. I am quite sure there are a couple of other channels out there that I have not heard of that I might enjoy, if only I had the benefit of a conversation. A lost opportunity for this provider!
Tuesday, April 13, 2010
"Discounts and Buyer Behavior - Where's The Logic?"
Everybody wants a deal. Even if the client is dead set on your product or service, you may very well have to provide a perceived price concession just to seal the deal. As a sales pro, you’ve been there before, haven’t you? Well here’s my question: when it comes to comparing costs and gaining price concessions, why does the buyer often favor the cost and/or concession when it is framed as a “discount” even though your effective price, after the discount, may still be higher than your competitor’s?
I have run into many situations where when it was time to consider price, the buyer compared only the discounts, not the list price or rack rate with the discount. Doesn’t it make perfect sense to do the latter and is it not foolish to do only the former? Look at marketing collateral everywhere – “discount!”, “discount!”, “discount!” is sometimes all that is printed. Why is the buyer in love with discounts, and not actual prices? I don’t get it.
I even try to put myself in the buyer’s shoes, I am one from time to time, and I still cannot develop the love affair with the discount in my choice of products and services. But it is always there! Back in my sales shoes, I experimented once and left discounts out of the cost page of my proposals and showed only actual pricing. I wanted to be simple and direct with my prospects in the belief that such an approach would improve my success. My win rate declined. Lesson learned there: always show your costs as a discount to something! And be prepared to bump the discount up a few points just to seal the deal. Everybody wants a deal.
In a perfect world, us sales pro’s would always be selling value and our buyers would always be buying value, thereby negating the need to spend much time on pricing and discounts. But it’s always there to consider. I just simply marvel over the attention a discount gets above and beyond that for the effective net price. Everybody wants a deal – “hey, I just got 30% off!” “Off of WHAT?!” I ask!!
I have run into many situations where when it was time to consider price, the buyer compared only the discounts, not the list price or rack rate with the discount. Doesn’t it make perfect sense to do the latter and is it not foolish to do only the former? Look at marketing collateral everywhere – “discount!”, “discount!”, “discount!” is sometimes all that is printed. Why is the buyer in love with discounts, and not actual prices? I don’t get it.
I even try to put myself in the buyer’s shoes, I am one from time to time, and I still cannot develop the love affair with the discount in my choice of products and services. But it is always there! Back in my sales shoes, I experimented once and left discounts out of the cost page of my proposals and showed only actual pricing. I wanted to be simple and direct with my prospects in the belief that such an approach would improve my success. My win rate declined. Lesson learned there: always show your costs as a discount to something! And be prepared to bump the discount up a few points just to seal the deal. Everybody wants a deal.
In a perfect world, us sales pro’s would always be selling value and our buyers would always be buying value, thereby negating the need to spend much time on pricing and discounts. But it’s always there to consider. I just simply marvel over the attention a discount gets above and beyond that for the effective net price. Everybody wants a deal – “hey, I just got 30% off!” “Off of WHAT?!” I ask!!
Tuesday, March 30, 2010
“Top Ten Things I’ve Learned About RFP’s”
With a number of years responding to Requests for Proposals (RFP’s), I have learned a few things about these dastardly thorns in the side of a Sales Pro. It is an interesting buying process for the customer. In the government, it is mostly mandated. In the corporate sector, it might be mostly desired, but rarely followed, depending on your industry or product. One fact for sure, RFP’s are highly resource-intensive on both sides of the table, for both buyer and seller. In these days of “do more with less”, that very aspect of the RFP stays at the forefront of my mind while deciding how to handle the newly-arrived RFP. Here is what I have learned, or come to question, about RFP’s: (Forewarned, this is not the Letterman format, 10 is best!)
1. There are three types of RFP processes: (1) The process where contact and communication are allowed freely through-out (2) The process where contact and communication are closely guarded or totally prohibited through-out (3) The process where you are the incumbent. In response to each situation, I say respectively, “Play, Run, Must Play”! The words of my second-grade teacher at recess are ringing in my ears!
2. RFP processes that do not allow a free exchange of ideas and questions between participants and customer do not educate the customer and will most likely end up in a poor decision for the customer, unless there are experts on your product and industry on the side for the customer. So why do buyers, without experts, sometimes put up so many barriers? They don’t want to be bothered by account teams? It shows the respect they have for our profession. I say let them go away in this case, if unsolicited. Even if you win it, it will likely be a relationship-poor and margin-poor relationship between the two companies. Bad divorce coming!
3. The RFP you helped to write is likely the one you will win. The RFP that arrives unsolicited is likely the one you will lose. This one’s been around since Ben Franklin sold his first time-piece! I wonder if Ben ever put his kite up into a cloud of incoming RFP’s and hit lightening??!!
4. Every study that I have conducted suggests that my team will win 10-15% of unsolicited RFP’s. Miller Heiman and other reputable sales training firms will likely back that up. What’s the opportunity cost of NOT pursuing other non-RFP opportunities to spend the time winning that 10-15% of the business? I say mostly it is not worth the trade-off. It’s like playing the slot machines. When do you quit throwing quarters at the machine and decide it’s time to go home and earn an honest wage?
5. Over a third of delivered RFP’s never result in a decision. More than 50% of RFP’s, when awarded, result in a major change of scope, almost always downward, significantly. My opinion and experience anyway. It’s the princess before midnight, and then it turns into an ugly pumpkin. And you spent all that money on the prom dress!!
6. Beware the RFI (Request for Information) that is supposed to result in an RFP. As the vendor, if you can make your presence “felt” by the prospect in the RFI stage, keep chasing it. Otherwise, run! How many RFI’s do you think even really turn into RFP’s? An extremely small percentage. We’re back at the Black Jack table! And your partner is up in the hotel room ordering expensive room service!
7. No single RFP is ever the same. Why can’t we make a rule in our business that “all RFP’s must have the same format for our product?” The fact that no RFP and RFP response will ever be the same, suggests that if your organization decides to spend much time here, that a dedicated group, or an RFP Response Team is put in place, so that traditional selling resources are freed up to do what they do best. This is a significant investment but required if RFP responses are significant to the company’s sales plan. Do you really want your OUTSIDE Sales Pro’s INSIDE in the company library pulling volumes of material and editing content? That’s like asking the landscaper to paint your living room!
8. In any RFP response, follow the customer’s format, question progression and instructions to the absolute letter-of-the-law. Put many sets of eyes on the final response. This cannot be overstated. The easier it is for the client to read your response (with a quality response, of course), the faster you pile on points for your team.
9. If you are the incumbent, take nothing for granted, but know that you have the biggest advantage in your favor: change is extremely hard for a customer toward a new provider. If you have provided good service and quality at a fair price over the preceding time, the odds are overwhelmingly in your favor. Got to bed tonight, get a good night’s sleep and attack it with fresh eyes tomorrow! The princess will still be a princess!
10. Here’s the RFP I like most. Our Sales Pro creates the opportunity through great discovery and relationship-building with a number of decision-makers. The solution begins to become scoped and the prospect suggests, “yes, but we must go to bid.” This Sales Pro does not quiver. S/he is extremely confident that she has everything in his/her own favor, and plays willingly and enthusiastically. Because s/he has the deal “under control”. There are no pressure tactics to force the prospect’s hands at not going to bid and there is no remorse on the part of the Sales Pro. In the end, it is a win-win for the prospect and the provider.
Is Number Ten nirvana for you? Maybe it is, but it should be your goal to create situations like this. If you’re in control, it makes perfect sense to let the deal take its course in accordance with the prospect’s buying process.
So maybe you can tell, I don’t like RFP’s. Truth be told, I don’t. They make capitalism inefficient (government business excluded from this remark). But I understand its role in our marketplace. And I have won my fair share of them. As a provider, just be sure that you have a well-planned and well-supported process for handling them. I hope the “Top Ten” help you and your organization to find that kind of governance if it is not already present. Good selling!
1. There are three types of RFP processes: (1) The process where contact and communication are allowed freely through-out (2) The process where contact and communication are closely guarded or totally prohibited through-out (3) The process where you are the incumbent. In response to each situation, I say respectively, “Play, Run, Must Play”! The words of my second-grade teacher at recess are ringing in my ears!
2. RFP processes that do not allow a free exchange of ideas and questions between participants and customer do not educate the customer and will most likely end up in a poor decision for the customer, unless there are experts on your product and industry on the side for the customer. So why do buyers, without experts, sometimes put up so many barriers? They don’t want to be bothered by account teams? It shows the respect they have for our profession. I say let them go away in this case, if unsolicited. Even if you win it, it will likely be a relationship-poor and margin-poor relationship between the two companies. Bad divorce coming!
3. The RFP you helped to write is likely the one you will win. The RFP that arrives unsolicited is likely the one you will lose. This one’s been around since Ben Franklin sold his first time-piece! I wonder if Ben ever put his kite up into a cloud of incoming RFP’s and hit lightening??!!
4. Every study that I have conducted suggests that my team will win 10-15% of unsolicited RFP’s. Miller Heiman and other reputable sales training firms will likely back that up. What’s the opportunity cost of NOT pursuing other non-RFP opportunities to spend the time winning that 10-15% of the business? I say mostly it is not worth the trade-off. It’s like playing the slot machines. When do you quit throwing quarters at the machine and decide it’s time to go home and earn an honest wage?
5. Over a third of delivered RFP’s never result in a decision. More than 50% of RFP’s, when awarded, result in a major change of scope, almost always downward, significantly. My opinion and experience anyway. It’s the princess before midnight, and then it turns into an ugly pumpkin. And you spent all that money on the prom dress!!
6. Beware the RFI (Request for Information) that is supposed to result in an RFP. As the vendor, if you can make your presence “felt” by the prospect in the RFI stage, keep chasing it. Otherwise, run! How many RFI’s do you think even really turn into RFP’s? An extremely small percentage. We’re back at the Black Jack table! And your partner is up in the hotel room ordering expensive room service!
7. No single RFP is ever the same. Why can’t we make a rule in our business that “all RFP’s must have the same format for our product?” The fact that no RFP and RFP response will ever be the same, suggests that if your organization decides to spend much time here, that a dedicated group, or an RFP Response Team is put in place, so that traditional selling resources are freed up to do what they do best. This is a significant investment but required if RFP responses are significant to the company’s sales plan. Do you really want your OUTSIDE Sales Pro’s INSIDE in the company library pulling volumes of material and editing content? That’s like asking the landscaper to paint your living room!
8. In any RFP response, follow the customer’s format, question progression and instructions to the absolute letter-of-the-law. Put many sets of eyes on the final response. This cannot be overstated. The easier it is for the client to read your response (with a quality response, of course), the faster you pile on points for your team.
9. If you are the incumbent, take nothing for granted, but know that you have the biggest advantage in your favor: change is extremely hard for a customer toward a new provider. If you have provided good service and quality at a fair price over the preceding time, the odds are overwhelmingly in your favor. Got to bed tonight, get a good night’s sleep and attack it with fresh eyes tomorrow! The princess will still be a princess!
10. Here’s the RFP I like most. Our Sales Pro creates the opportunity through great discovery and relationship-building with a number of decision-makers. The solution begins to become scoped and the prospect suggests, “yes, but we must go to bid.” This Sales Pro does not quiver. S/he is extremely confident that she has everything in his/her own favor, and plays willingly and enthusiastically. Because s/he has the deal “under control”. There are no pressure tactics to force the prospect’s hands at not going to bid and there is no remorse on the part of the Sales Pro. In the end, it is a win-win for the prospect and the provider.
Is Number Ten nirvana for you? Maybe it is, but it should be your goal to create situations like this. If you’re in control, it makes perfect sense to let the deal take its course in accordance with the prospect’s buying process.
So maybe you can tell, I don’t like RFP’s. Truth be told, I don’t. They make capitalism inefficient (government business excluded from this remark). But I understand its role in our marketplace. And I have won my fair share of them. As a provider, just be sure that you have a well-planned and well-supported process for handling them. I hope the “Top Ten” help you and your organization to find that kind of governance if it is not already present. Good selling!
Subscribe to:
Posts (Atom)
