44% consider that their way of working with pipeline management is ineffective, according to a study, published in the Harvard Business Review. The study shows that companies that implement these three different "best practices" saw 28% higher growth in sales than other companies.
The purpose of working with pipeline management is to systematically get an overview of your business opportunities but also to actively work with transfers/progress. When this is done effectively, it results in a higher growth in sales.
In a study that provides evidence for this, it was seen that companies that work with three different "best practices" at the same time increased their sales 28% more than other companies. These three best practices are
1. Clear sales process 2. Set aside time for pipeline work 3. Train sales managers in pipeline development
1. Clear Sales Process In order to work with pipeline management, you need a clear sales process. Tips for creating clarity in a sales process.
The sales process needs to match the customer's decision process for your customers.
Any progress in a business opportunity is directly dependent on the customer taking a step forward in their decision-making process. It is therefore crucial to understand the customer's decision-making process and match it to your own sales process.
Read more about the psychological step that people take when making a decision - the customer's decision process .
Both salespeople and sales managers need to understand the different phases of the sales process and why you place your prospects in each phase. This may sound elementary but test it on your own sales organization.
Question : what different sales process phases do we have. When do you place a business opportunity in the respective phase. What needs to be accomplished when you move a business opportunity from one phase to another.
As a sales manager, you also need to understand what needs to be done in each phase to create transfers.
Here it becomes important not only to describe what needs to be done, but also how to do this as a seller.
My experience is that many sales organizations slave over this. The salesperson/sales manager does not have an overview of the different phases of the sales process and you do not know what each phase entails. This leads to a lack of clarity with what is to be done and which support tools are to be used.
2. Set aside time for pipeline work (at least three hours/month) Spend at least three hours per month to work actively with pipeline management (salesperson + sales manager). A common misconception is that pipeline management is about closing dates, the right size of the deal, the probability of a deal, etc. This is more forecasting work than pipeline management work. Pipeline management is about the seller (and the sales manager) understanding which opportunities to work with (priorities), what to do, and how to do it - all with the aim of getting a structured and methodical advancement of their opportunities in their sales pipeline.
3. Train sales managers in pipeline management More than 60% of the company managers considered that the sales managers were not trained well enough to work with pipeline management, according to the study. Being a sales manager and being good at your CRM is not pipeline management. A sales manager needs to be trained in understanding what and how to develop a sales pipeline.
Where should the sales manager put his focus in a pipe to have the greatest effect?
A sales manager also needs to be able to convey this to a salesperson in a good way (what should be coached and how should this be done)
Here comes the demand for a coached leadership instead of a controlling leadership.
Sales leadership is crucial to working effectively with Pipeline Management. An important part of sales leadership involves planning, prioritizing - this applies especially in pipeline management.
Good luck with the sales leadership!
Harvard Business Review: Companies with a Formal Sales Process Generate More Revenue by Jason Jordan & Robert Kelly
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