Are you sick and tired of seeing the same opportunities listed in your salespeople's forecasts and pipelines? How many of the opportunities have been stalled at the same step in the sales cycle for weeks…or months?

Sales pipelines can be funny things

You have absolute visibility to what goes in the front end (sales leads). You have absolute visibility to what comes out the back end (closed sales). The million-dollar question is, "What's going on in the middle?"

Here are five reasons that are especially important:

1. Sales managers don't have enough time to ride with salespeople as much as they would like
   
   
2. Salespeople sometimes tell their managers exactly what they think they want to hear
   
   
3. Salespeople tell the truth as they perceive it…but they're human, and sometimes they're wrong
   
   
4. Sometimes salespeople just outright fudge
   
   
5. ALL salespeople wear rose-colored glasses

Do any of these five reasons sound like they apply to your company? If any one of them applies…just one…then you have absolutely no view of what's going on in the middle of your sales pipeline, even if you talk to your salespeople every day!

The competitive realities of today's marketplace are making selling more difficult than ever. Here are five simple sales truths that face all salespeople today:

A basic reality of the current business climate is that customer relationships go away. This happens for the following reasons:

• Most products and services have been relegated to "commodity" status
  
  
• Management pressures to cut costs force customers to investigate alternative providers
  
  
• Competitors who are willing to accept lower margins consistently drive market prices lower
  
  
• Corporate takeovers, closures, and downsizings alter organizational buying processes

Every salesperson loves recurring revenue, which is income derived from past sales and/or repeated customer purchases. However, it is possible that the percentage of a salesperson's production from recurring revenue can be too high. What will happen when some of that business (inevitably) goes away?

Truly professional salespeople and sales managers continuously consider the following questions:

• What percentage of our annual revenue is recurring revenue?
  
  
• What is the financial position of each of our major customers?
  
  
• What is the competitive position of each of our major customers?
  
  
• How much emphasis is being placed on securing NEW clients?

It is critical for your company to provide superior customer support to your customer base.

After all, it is your customers who pay your company's bills, and significant opportunities for incremental sales to those customers still exist. In time, however, factors that may be entirely out of your company's control could cause each of your current customers to stop buying!

The only way to compensate for this first Simple Sales Truth is to consistently win NEW customers. Long-term success requires balancing activities that are designed to generate revenue from both EXISTING and NEW accounts.

In today's economic climate, a variety of competitive products and services are available to your prospects. Plus, any number of prospect initiatives may compete for funding that could be applied to doing business with your company. As a result, a salesperson cannot expect to close a large percentage of the opportunities they pursue.

Successful salespeople understand the multiple of opportunities required for each closed piece of business. This multiple will be different for every salesperson based upon the marketplace, the salesperson's talents and skills, etc. As a rule of thumb, salespeople close 10% to 20% of their prospects. This means that at any given time salespeople should be working 5 to 10 times the number of opportunities they need to close in order to achieve their sales goals!

The key points here are KNOWING and MAINTAINING the required multiple.

A salesperson with a 10:1 multiple will close one sale for every ten prospects. An alternative view is that for every sale this salesperson makes, ten of his or her prospects will go away!

Why will ten prospects go away if only one has been sold? If the salesperson's multiple is 10:1, we know that, on average, nine other prospects will NOT convert into sales. It may be difficult to determine which nine current prospects won't close, but the multiple indicates this IS what will happen.

Salespeople frequently get into a dangerous pattern.

They prospect in their territories for several weeks and generate a workable base of prospects. Then they spend the next several months trying to close business from this base. Some of the opportunities will close; most will not. When the salespeople finally realize their prospect base is dangerously low, they begin the process over again. This behavior of inconsistent prospecting directly correlates to inconsistent sales results in subsequent months!

Salespeople must compensate for this fact by CONTINUALLY adding enough new opportunities to their pipelines to replace the losses that can be predicted by their multiples.

Salespeople cannot wait for sales to happen to refill their pipelines! The number of prospects required by their multiples usually means that prospecting activities must occur both BEFORE and AFTER any sale. In other words, prospecting is a function that must be performed constantly.

NOTE: It is actually possible to have too high of a closing ratio. If a salesperson wins business from most of the people with whom they come in contact, it generally means they are not meeting enough new people!

Most salespeople can point to customers who "walked in the front door." These customers recognized needs within their organizations and called one or more companies in an attempt to fill those needs. Unfortunately, there are rarely (if ever) enough of these customers to enable salespeople to meet their quotas.

Most companies that are prospects for your company's products or services are currently in buying relationships of some sort. Most likely they are not considering changing these relationships. In fact, getting a prospect to change a current buying relationship is one of the most difficult things a salesperson needs to do. These existing buying relationships, which we call "the status quo", are your salespeople's biggest competitors.

When prospecting, your salespeople must realize that any prospects they reach will most likely NOT recognize a need for your company's products or services when the conversation begins. After all, if they DID recognize a need, they would already be doing something about it, wouldn't they?

How will your salespeople overcome the status quo? How will they grab prospects' attention and convince them to schedule time for more detailed discussions? How will you track and inspect the quantity and quality of your salespeople's activities in this critical area?

It is a simple fact that the longer a sale takes, the less likely it is to happen.

Every product or service has a "sales cycle" that measures the average length of time required to close a typical customer. The longer a potential sale extends beyond the normal sales cycle, the more its chances fade. Why? Here are several reasons:

• A prospect's initial sense of urgency can diminish
  
  
• Alternatives to your product or service can be identified and selected
  
  
• Different uses of funding can take precedence over acquiring your product or service

Many salespeople do not understand the ramifications of time.

If too much time is allowed to pass between meetings, much of what was discussed can be lost or forgotten. Plus, if discussions and meetings are not designed to advance sales cycles, they are probably less productive than they should be.

Time is the most precious commodity a salesperson has.

Individual success is dependent upon where a salesperson chooses to spend his or her time. Successful salespeople understand the normal sales cycle lengths for their products or services and strive to close business within these time frames. Opportunities that extend beyond normal sales cycles must be analyzed and prioritized appropriately.

This does not suggest that "deadlines" should be imposed upon prospects. However, the fact of the matter is that salespeople cannot count on those opportunities that have extended beyond normal sales cycles nearly as much as they can on opportunities that currently fall within normal sales cycles. In choosing where to spend their time, salespeople are best served by concentrating their efforts on the opportunities that are most likely to close, i.e., the opportunities that are still within normal sales cycles.

No sale can be counted upon unless the prospect is actively engaged in the sales cycle. What does it mean to be "actively engaged"? This is defined by the prospect's willingness to commit to a next step.

What is a valid next step?

It is a specific, scheduled appointment with an agenda designed to move the sale closer to "closed". The appointment may be in person or on the telephone, but it must be on the PROSPECT'S calendar. Plus, the salesperson must have an agenda to advance the sale, not merely check the status of the prospect's decision process. In other words, the purpose of the call cannot be to schedule a future discussion.

While there is no guarantee that an opportunity that meets these conditions will close, the chances of securing revenue from an actively engaged prospect are far greater than the chances of securing revenue from a prospect that refuses to commit to a next step.

Salespeople can use this simple rule to validate whether or not a prospect is truly "hot":

This approach has two advantages:

1. If a prospect is truly interested in moving forward, he or she will readily grant the salesperson more time and schedule it in his or her own calendar. If the prospect does NOT want to continue the sale, he or she will hesitate to schedule more time.

Too often a prospect will say, "Call me next week to schedule our next appointment." This is often used as a way to get the salesperson out of their office. Every salesperson has experienced prospects saying these very words, then not returning telephone calls the following week.

Some salespeople are reluctant to ask for a next step for fear that the answer is going to be "no". These salespeople are only creating false hopes, which do NOT generate sales.

1. Putting a next appointment on the calendar before the current meeting ends ensures it can take place in a timely manner.

Why is this important? Schedules can fill up, even if the follow-up scheduling call takes place just a few days later. By scheduling the next appointment before leaving the current appointment, a salesperson can come back to the prospect in the shortest possible time. The benefit of this is shorter sales cycles.

It is important to emphasize that next steps need to be structured to productively advance a sale.

A scheduled visit to "check the status of things" or to "see if they are willing to consider our company" is NOT a valid next step!

Additionally, any scheduled next step must be within the normal sales cycle. A prospect that agrees to receive a call on a date outside the normal sales cycle cannot be seen to be actively working toward a purchase (though of course these calls DO deserve follow-up).

When these "Next Step" rules are followed exactly, it is not unusual to see that just a small percentage of the opportunities currently being worked by a sales team meet the criteria.

This is entirely intentional! The simple truth is that prospects for which valid next steps have been scheduled have a much greater likelihood of purchasing. These are the "real" opportunities. Tracking the number of "real" opportunities in each phase of the sales cycle will tell managers whether salespeople have enough potential business in their current pipelines to ensure future success.

By categorizing opportunities in this manner:

• Salespeople and managers will be able to separate reality from fiction and opinions from fact
  
  
• Managers will be able to assist salespeople with the prospects that truly matter
  
  
• Managers will be able to set salesperson prospecting activity expectations at a level that will ensure sufficient concurrent "live" prospects to produce consistent success
  
  
• Salespeople and managers will be able to provide more accurate forecasts

However, they CAN be compensated for. Wouldn't it be great if your salespeople and sales managers had a visualization tool that enabled them to determine whether the quantity and quality of current activity is sufficient for them to be successful? Wouldn't it be great if this tool indicated specific actions they could take to improve their chances of achieving their goals?

The M-Power™ sales activity management system brings an innovative, process-based approach to your company's sales activities. This internet-based, NEW BUSINESS activity driver will focus your sales team, top-to-bottom, on specific activities for increasing sales.

M-Power™ works best in business-to-business (B2B) sales organizations where typical sales cycles include multiple activities and extend over at least several weeks.

Measurement & Reporting

• You can't see what is going on in the middle of the pipeline. All you can see is leads going in the front end and (a few) sales coming out the back end.
  
  
• You can't tell if your company will meet its sales goals
  
  
• You don't know the true length of the sales cycle for each of your products or services
  
  
• Your salespeople have trouble accurately forecasting future sales
  
  
• Your salespeople provide unrealistic forecasts of opportunity closing potential ("rose colored glasses")
  
  
• Your salespeople drop prospects right after a forecast comes out and you don't know about it until the next forecast

Management Time

• You don't have enough time to travel with all of your salespeople
  
  
• You don't have time to talk to each salesperson about all of his or her opportunities
  
  
• You don't spend enough time with the salespeople who need your help

Salesperson Time

• Your salespeople claim they are too busy to prospect
  
  
• Your salespeople claim they are too busy to keep management informed of their activities
  
  
• Your salespeople don't know how to best allocate their time

Management Effectiveness

• You have no way of knowing about opportunities "going south" unless your salespeople bring them to your attention
  
  
• You learn about lost opportunities too late to have any chance of saving them
  
  
• You don't have accurate information about why business is being lost
  
  
• You spend most of your time being reactive because you don't have the information you need to be proactive
  
  
• You have difficulty predicting whether a new salesperson will "make it"
  
  
• You are unaware of lapses in salesperson effort
  
  
• You have difficulty figuring out how hard each salesperson is working or whether they are working on the right activities
  
  
• You can't pinpoint individual salesperson strengths and weaknesses
  
  
• You can't pinpoint training needs
  
  
• You have difficulty determining how much impact a salesperson is having on their territory
  
  
• Your salespeople are not focused on the opportunities with the most revenue or profit potential

Salesperson Effectiveness

• Your salespeople are not prospecting enough
  
  
• Your salespeople are doing too much "farming" and not enough "hunting"
  
  
• Your salespeople spend too much time working on unlikely opportunities
  
  
• Your salespeople have difficulty separating buyers from information seekers
  
  
• Your salespeople don't understand how to shorten sales cycles
  
  
• Your salespeople don't re-qualify throughout the sales process
  
  
• Your salespeople don't know when to ask for sales management help
  
  
• Closing ratios are too low
  
  
• Sales cycles are too long
  
  
• Your salespeople don't know how to avoid steep hills and valleys in sales performance

It challenges salespeople to look at their opportunities and activities differently. Plus, it enhances the tactical and strategic effectiveness of sales meetings, either one-on-one or as a team.

M-Power™ examines salespeople's sales activities and provides sales managers with:

• Personalized coaching recommendations to improve the quantity and quality of salesperson activity
  
  
• Identification of specific roadblocks that are preventing salespeople from moving opportunities forward
  
  
• A comprehensive series of alerts that direct managers toward opportunities and salespeople that are in need of immediate managerial attention
  
  
• An array of historical and predictive reports that were developed to provide a realistic assessment of sales team and individual performan

M-Power™ is also designed to allow you to embed your sales training principles into the system. This keeps learned concepts "top of mind" for salespeople and sales managers, which helps ensure the ongoing utilization of skills taught during any sales training program in which your company has invested.

M-Power™ will help your salespeople:

• Separate the buyers from the information seekers, enabling your salespeople to devote appropriate attention to the prospects that are most likely to buy
  
• Understand what "real" sales cycle progress means (this will get them to remove their "rose colored glasses")
  
• Plan appropriate next steps that will advance sales cycles
  
• Know when to walk away from "no potential" prospects, providing more time to find new, "good" prospects
  
• Shorten sales cycles
  
• Avoid valleys in performance

Contact management software such as Microsoft Outlook and CRM (client relationship management) software such as ACT!, GoldMine, Oracle, salesforce.com, SalesLogix, Siebel, etc. fall into a category called Sales Force Automation (SFA).

The primary benefit of SFA is historical data collection (names, addresses, phone numbers, conversation notes, etc.). This data is extremely valuable when salespeople leave; however, it does little to help management accomplish the following important tasks:

• Accurately assess the quality of the sales pipeline - which opportunities are valid, and which ones are not?
  
  
• Accurately forecast sales and profits
  
  
• Determine whether salespeople are investing enough time in prospecting for NEW sales opportunities
  
  
• Determine the quality of salespeople's prospecting activitie

1. M-Power™ is predictive. In other words, it predicts whether a salesperson has enough opportunities at key sales cycle stages to enable them to consistently meet quota. If a salesperson appears to be in danger of missing quota in a current or future time period, M-Power™ provides proactive alerts AND suggests actions the sales manager can take to rectify the situation.
   
   
2. M-Power™ also provides proactive alerts for sales opportunities that are falling outside average sales cycle lengths. This enables sales managers to see problem opportunities early enough to be able to influence the outcome.
   
   
3. CRM systems do NOT provide proactive alerts. CRM forecasts and pipeline reports just facilitate pipeline conversations. It is up to the sales manager to ask the right questions to determine the validity and likelihood of closure for specific sales opportunities.
   
   
4. CRM and contact management data entry can consume anywhere from 20 minutes to one hour per day. M-Power™ data entry consumes five minutes or less per day. This is critical, as many salespeople have little tolerance for administrative activities.
   
   
5. M-Power™ is a NEW BUSINESS activity driver. It is designed to manage current, valid, new opportunities with prospects AND customers. Because of this focus, M-Power™ helps salespeople and sales managers focus on just those activities that advance sales cycles toward closure (as opposed to the many activities that make salespeople and sales managers feel very busy, but do not advance sales cycles toward closure).
   
   
6. M-Power™ reduces the amount of time sales managers spend on administrative activities such as collecting and massaging date for reports. This enables them to focus more time on activities that generate revenue.
   
   
7. Most CRM systems are designed to look at sales cycles based upon the steps in a company's internal sales process. M-Power™ looks at the sales cycle from the viewpoint of the BUYER.
   
   
8. CRM systems can be very expensive to purchase and set up. Plus, setup time and customization can take many months.
   
   
9. M-Power™ is an ASP (application service provider) application that is hosted on the internet. It is specifically designed for rapid setup and customization, reducing implementation time to a matter of days.
   
   
10. CRM systems can give salespeople a false sense of security due to the sheer number of "opportunities" that can be reflected in their sales pipelines. (What salespeople emotionally consider their prospect base to be triggers their sense of urgency for doing more prospecting. If they have 35 file folders on their desks, they think they have a lot of prospects - even if 33 of them won't return their calls!)
    
    
11. M-Power™ removes the false sense of security and creates more urgency because it shows salespeople where the weak spots are in their pipelines.
    
    
12. M-Power™ identifies the reasons why sales are not advancing for each individual salesperson. Plus, M-Power™ provides a detailed explanation of the problem(s) and suggests questions for the sales manager to ask the salesperson to dissect and resolve the issue(s).
    
    
13. Most CRM system reports show the sales that have been made and the accounts that have been called upon. How do you steer a ship when you are always looking at the wake?
    
    
14. M-Power™ reports focus on current and future activities and identify whether salespeople's activity levels are sufficient to enable them to achieve their goals.

No, it doesn't! As mentioned earlier, CRM and contact management software applications are terrific repositories for historical data such as names, addresses, phone numbers, conversation notes, etc. This data is extremely valuable, especially when salespeople leave.

M-Power™ can be integrated with many of the top CRM and contact management systems. This allows you to use your CRM and contact management software applications for the functions they perform best, and M-Power™ for proactively managing sales activities.

Maybe…but it would take a very long time, and it would cost a fortune.

It's not easy to build proactive alerts into software applications; nor is it easy to build in hundreds of questions and suggestions that are specifically designed to help sales managers drill down into sales performance problems. Besides, how are you going to modify your CRM or contact management software to reduce salesperson data entry time to five minutes or less per day?

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• Increased and consistent prospecting
  
  
• Shorter sales cycles
  
  
• Higher closing ratios
  
  
• Greater sales force effort and effectiveness
  
  
• Sales management focus on revenue-generating activities

• Monitor salesperson effort
  
  
• Distinguish hunting vs. farming activities
  
  
• Pinpoint salesperson strengths and weaknesses
  
  
• Predict results
  
  
• Establish manageable expectations
  
  
• Objectively justify termination decisions
  
  
• Measure prospects' progress through sales cycles
  
  
• Identify hidden difficulties
  
  
• Intervene in a timely manner to influence outcomes
  
  
• Be proactive

• Separate the buyers from the information seekers
  
  
• Understand "real" prospect progress
  
  
• Plan next steps
  
  
• Shorten sales cycles
  
  
• Avoid valleys in performance

The bottom line is increased market share through a more productive sales force!

Do you want to demonstrate to your salespeople that you are more interested in substance than style, in facts rather than opinions, in results instead of promises? Then put a meeting with us on your calendar! Together we will explore how you can gain complete control of your sales operation and focus the efforts of your salespeople and sales managers in the areas that ensure consistent success.