Top Performing Tactics for Overcoming a Stagnating Sales Pipeline
 

Top Performing Tactics for Overcoming a Stagnating Sales Pipeline

on

  • 331 views

It’s inevitable that at some point, sales processes and sales technologies will fail to maximize revenue. Perhaps this is due to a changing economy or changes in buyer behavior. Perhaps it stems ...

It’s inevitable that at some point, sales processes and sales technologies will fail to maximize revenue. Perhaps this is due to a changing economy or changes in buyer behavior. Perhaps it stems from a recent shift in the strategic direction of the business or a competitive threat. Regardless of the reason, sales processes require constant optimization and attention. But who has the time?

Discover how top performing organizations overcome and stay ahead of stagnating sales growth in a new study by Ian Michiels, Principal Analyst at Gleanster, a top sales technology research firm, entitled “Top Performing Tactics for Overcoming a Stagnating Sales Pipeline.”

Does your sales organization suffer from any of the following symptoms?

- Opportunities stuck in the pipeline
- Reps leave opportunities as ‘inactive’ to protect them
- CRM technology not used effectively
- Insufficient leads volume for inside sales
- Opportunities slipping through the cracks
- Lack of process

You will learn how you can diagnose a stagnant sales pipeline by taking a detailed look at your people, process and technology and comparing them to the tactics that top performing companies implemented to address these issues and achieve sales success.

Statistics

Views

Total Views
331
Views on SlideShare
331
Embed Views
0

Actions

Likes
1
Downloads
7
Comments
0

0 Embeds 0

No embeds

Accessibility

Categories

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    Top Performing Tactics for Overcoming a Stagnating Sales Pipeline Top Performing Tactics for Overcoming a Stagnating Sales Pipeline Document Transcript

    • Entire content © 2013 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction prohibited. Note: This document is intended for individual use. Electronic distribution via email or by post- ing on a personal website is in violation of the terms of use. February 2013 About the Pie Chart The data presented in the pie chart is derived from the Q3 2012 Intgrated Customer Relationship Management survey (n=198). The data serves as the basis for this Gleansight Deep Dive, which provides analyst commentary related to a particular aspect of the topic. The objective is to provide additional perspective and illuminate certain key considerations regarding the implementation of the related technology-enabled business initiative. Additional survey data utilized in this Deep Dive: »» Q1 2013 Gleansight benchmark report on Sales Performance Management (n=97) »» Q3 2012 CRM for Small and Midsize Organizatoins survey (n=318) To learn more about Gleanster’s research methodology, please click here or email research@gleanster.com. Deep Dive Top Performing Tactics for Overcoming a Stagnating Sales Pipeline Are your sales efforts producing diminishing returns? It’s inevitable that at some point sales processes and sales technologies will fail to maximize revenue. Perhaps this is due to a changing economy or changes in buyer behavior. Perhaps it stems from a recent shift in the strategic direction of the business or a competitive threat. Regardless of the reason, sales processes require constant optimization and attention. But who has the time? This Deep Dive will explore how Top Performing organizations overcome and stay ahead of stagnating sales growth. 74% ercentage of Top Performers that regard “Generate mer Insights” as a top reason to monitor Social Media 68% Percentage of Top Performing companies that reported year-over-year revenue growth of 10% or more between 2011 and 2012. Best Practice Answers to Common Questions How do you know if your customer relationship management (CRM) approach is producing diminishing returns? Much like a doctor evaluates a sick patient, diagnosing the problem starts with identifying symptoms. Symptoms that go hand in hand with a stagnating pipeline include: • Longer-than-average sales cycles • High sales rep turnover • Recent loss of market share • Difficulty accurately forecasting sales results Research reveals that 9 out of 10 sales leaders will readily admit there is “room for improvement” with respect to internal CRM processes or technologies. It’s easy for a depressed global economy to mask internal issues. While buyers may be savvy, and purchase decisions generally take longer, there’s also a good chance internal initiatives such as optimizing sales processes or improving
    • Note: This document is intended for individual use. Electronic distribution via email or by post- ing on a personal website is in violation of the terms of use. Top Performing Tactics for Overcoming a Stagnating Sales Pipeline 2 Entire content © 2013 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction prohibited. Top Performers Defined Gleanster uses 2-3 key performance indicators (KPIs) to distinguish “Top Performers” from all other companies (“Everyone Else”) within a given data set, thereby establishing a basis for benchmarking best practices. By definition, Top Performers are comprised of the top quartile of qualified survey respondents (QSRs). The KPIs used for distinguishing Top Performers focus on performance metrics that speak to year-over- year improvement in relevant, measurable areas. Not all KPIs are weighted equally. The KPIs used for this Gleansight are: • 12-month change in revenue • Current Lead-to-Sales Rate • 12-month chagne in Lead-to-Sales Rate the availability of information could give your sales reps the competitive edge they desperately need. A 2012 survey on Integrated CRM indicated that the top challenges with CRM continue to be the same challenges organizations were facing 20 or 30 years ago: getting reps to use the technology effectively. (See Figure 1.) The natural byproduct of an unused system like CRM is data credibility, and it’s a perpetually growing problem for the organization. The less information reps enter into the system, the less accurate the pipeline and CRM metrics are, leading senior management to circumvent CRM and turn to spreadsheets as a system of record. Best Practice Answers to Common Questions Sometimes the signs of a stagnating pipeline are less obvious. In fact, a variety of factors may even be early symptoms that can be addressed before they become a serious problem. It’s also important to apply a methodical approach to evaluating pipeline success. Since maximizing revenue is the desired outcome, it’s important to explore all three areas that impact sales success; people, process, and technology. (See Figure 2.) Stagnating opportunities. Are opportunities stuck in the pipeline for abnormally longer periods of time? Eight out of ten Top Performers measure the average sales cycle time as an “ongoing metric in sales dashboards.” Regardless of whether the sales cycle is measured in minutes, weeks, months, or years, understanding deviations that are outside of normal variances is critical to staying on top of potential issues. Stagnating opportunities could be an indication that sales reps are not properly trained, leads are not sufficiently nurtured or qualified, or sales processes are not being followed. Reps leave opportunities as ‘inactive’ to protect them. For Top Performers, CRM is about more than a vehicle to capture customer data and opportunity management. To the extent data from other systems (such as marketing, finance, or operations) can be integrated within CRM to empower sales reps and maximize the success of customer communications, CRM Figure 1: Top Challenges with CRM in 2012
    • Note: This document is intended for individual use. Electronic distribution via email or by post- ing on a personal website is in violation of the terms of use. Top Performing Tactics for Overcoming a Stagnating Sales Pipeline 3 Entire content © 2013 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction prohibited. becomes a competitive advantage in sales. CRM technology not used effectively. Despite decades of best practice research and mature investments in CRM technology, driving adoption continues to be a top three challenge for Top Performers and all organizations. Longer sale cycles or an idle pipeline could be nothing more than a salesforce that is not updating CRM in a timely manner. When sales reps fail to leverage CRM, more often than not CRM is used as a management tool that, to the average sales rep, does nothing more than track and monitor information that could be used against them. For Top Performers, CRM is a source of competitive advantage for reps. CRM becomes a destination for sales people to get a leg up on deals, supplying background information on accounts or contacts, lead qualification through lead scoring, insight into marketing communications and engagements, products purchased customer service interactions, etc. Insufficient leads passed to inside sales. For some organizations, inside sales (remote/virtual sales) plays a critical role in qualifying or even closing opportunities. A number of factors influence the effectiveness of inside sales reps, including lead qualification, the accuracy of contact information, and training. But inside sales is largely a numbers game requiring productivity, discipline, and consistency. A stagnating pipeline could be an indication that the volume of leads entering the sales pipeline is not sufficient to meet sales targets. Opportunities are slipping through the pipeline. According to Gleanster research, approximately 50% of the leads that enter the sales pipeline will not close in the near term but will likely close in the future. If processes or technology do not allow sales reps to route opportunities that are not Figure 2: Diagnosing a Stagnant Sales Pipeline
    • Note: This document is intended for individual use. Electronic distribution via email or by post- ing on a personal website is in violation of the terms of use. Top Performing Tactics for Overcoming a Stagnating Sales Pipeline 4 Entire content © 2013 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction prohibited. ready to buy back to marketing, then these opportunities are frequently lost to competitors. These leads represent an investment from the organization, and therefore should be methodically managed to maximize the chance of a long-term sale. Lack of process. If lack of process plagues sales results in your organization, there’s a good chance sales is not reaching its full potential. Top Performers rank streamlining and establishing consistency in company sales processes as a top three value driver for maximizing CRM success. Top Performing Strategies for Boosting Sales Results Empower sales for value-added engagement . The balance of power has shifted in the sales process, and these days consumers are in control. Sales must be sensitive to the fact that buyers are often more informed about competitive offers and product benefits well before engaging with sales. Growth in emerging channels like social media provides 24x7 access to happy and unhappy customers, colleagues, friends, and competitive pricing. But when Gleanster asked sales leaders if social media had an impact on the sales process, six out of ten sales resources responded “somewhat” or “not at all.” That’s because social media doesn’t really have a direct impact on the close, but it does have an indirect impact that many organizations overlook. The web is about empowerment, and information is power. For Top Performing organizations this means customer acquisition is less about selling and more about building a trusted relationship. There are simply too many marketing messages and too many sales pitches to take in, so capturing mindshare and earning a conversation requires salespeople to deliver value when interacting with a prospect. For Top Performers, automation plays a critical role in empowering sales reps. Easy access to information about a prospect or customer from within CRM gives reps insight into how to shape and mold a conversation in the context of each buyer. Top Performers are 7x more likely to automate value-added engagement with nurturing and scoring so educated and qualified opportunities are passed to the sales team. By giving sales visibility into past customer behavior from within CRM, reps start to rely on CRM for critical information that gives them a leg up and increases the likelihood of a closed sale. Educate sales on the customer lifecycle. On the surface this may seem like a blatantly obvious best practice. Sales people should know and understand the sales process because we live it day after day. But the Gleanster survey on Integrated Customer Relationship Management revealed that Top Performing organizations are 3x more likely than Everyone Else to document and standardize a formal understanding of the customer journey from marketing, to sales, to customer service. In fact, just two out of ten of the average What is value? It’s important to keep in mind that value- added engagement is not defined by a good product or a great deal. It’s about the perception of value in the mind of the buyer. If the pipeline is stagnating, it could be because reps are not effectively contextualizing the solution or problem for each individual prospect. Value-Added Engagement: • Earn conversations with prospects • Sales needs to qualify and share what makes a “good” sales conversation so marketing automation and nurturing can enhance sales conversations Figure 3: Understanding of the Customer Lifecycle
    • Note: This document is intended for individual use. Electronic distribution via email or by post- ing on a personal website is in violation of the terms of use. Top Performing Tactics for Overcoming a Stagnating Sales Pipeline 5 Entire content © 2013 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction prohibited. organizations actually document this process. (See Figure 3.) Keep in mind that the customer experience spans every interaction with your brand. When sales targets are falling short, there’s a good chance the process is breaking down in one or more areas. A formal understanding of the customer lifecycle – from lead, to prospect, to customer – will provide a systematic way to ensure each step in the value chain is actually adding value to the next. (See Figure 4.) Understand the role of technology in the sales process. There are two fundamental best practices Top Performers teach us about sales technology. One, not all CRM technologies are created equal. Two, CRM alone only partially addresses some of the best practice demands of Top Performing sales teams. CRM, often referred to as sales force automation (SFA), typically refers to solutions with a distinct and standard set of capabilities, including contact management, account management, territory management, opportunity management, and forecasting and analytics. These capabilities make traditional CRM ideal for managing a long sales cycle or a few quality leads. While any CRM tool can be customized to meet the unique needs of the organization, Top Performers are 8x more likely than Everyone Else to rely on pre-configured modules or integration with other systems to augment sales success. Excessive customization within CRM rarely delivers the desired value, and it often makes future upgrades or process changes difficult. Furthermore, traditional CRM technologies are largely designed for one unique type of selling: enterprise sales. But today, more and more organizations are relying on inside sales teams to qualify or sell to prospects. The inside sales process demands high volume and rapid turnaround on leads – that makes productivity, discipline, and consistency critical to success. The average CRM tool is not necessarily designed to augment insides sales processes with lead routing, prescriptive selling, telephony integration, workflows, and call scripts. The second common problem with defining the role of technology is a general lack of knowledge about the types of technologies that can augment or optimize sales success. Eight out of ten sales leaders desired “a better understanding of sales technologies” in 2012. (See Figure 5.) It seems that knowledge about how technology can play a role in optimizing sales and the expected return on investment that can be achieved is still a mystery for sales leaders. Figure 5 highlights some of the Figure 4: Elements of the Customer Lifecycle
    • Note: This document is intended for individual use. Electronic distribution via email or by post- ing on a personal website is in violation of the terms of use. Top Performing Tactics for Overcoming a Stagnating Sales Pipeline 6 Entire content © 2013 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction prohibited. common classifications of technologies across three areas of sales optimization. • Sales Effectiveness: Technologies designed to enhance or improve sales results. These technologies typically give sales reps a leg up in specific stages of the customer lifecycle to maximize the chance of winning an engagement in “the right terms and in the right timeline.” • Sales Enablement: Technologies and services designed to enhance the individual success of sales reps, in a systematic way. Most organizations are guilty of opportunistic or haphazard sales enablement that gives sales reps just enough information to be marginally effective. Done correctly, a sales enablement infrastructure should make sharing best practices across the sales function a scalable and ongoing process that is readily accessible anytime and anywhere. • Sales Performance Management (SPM): Technologies designed to systematically manage incentive compensation management (to minimize spreadsheets and manual processes) and empower sales reps to forecast and manage sales success from within CRM. SPM also includes technologies to find, hire, and manage sales resources. Research from Gleanster suggests Top Performing organizations are as much as 6x more likely than Everyone Else to augment CRM investments with third- party solutions designed to maximize sales results. Today, the widespread acceptance of Software-as-a-Service (SaaS) makes these solutions both affordable and accessible to even the smallest organization. In fact, one of the most common ways for Top Performers mitigate adoption challenges with CRM is by ensuring the CRM is also a destination for reps to access critical information on prospects or accounts, locate best practice materials, or locate new opportunities sorted by propensity to purchase. Figure 5: Categories of Sales Technologies
    • Note: This document is intended for individual use. Electronic distribution via email or by post- ing on a personal website is in violation of the terms of use. Top Performing Tactics for Overcoming a Stagnating Sales Pipeline 7 Entire content © 2013 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction prohibited. Automate measurement and metrics. For Top Performers, the top three metrics for measuring the success of CRM initiatives tend to be the most obvious; revenue growth (85%), actual vs. forecasted revenue (82%), and win/loss percentage by sales rep (67%). At first glance, these metrics seem to make sense because they are outcome-based and directly tied to the goal of any CRM investment – to maximize sales. It’s interesting to note that the fourth most common metric for measuring sales success is system usage. Looking back at some of the top challenges with respect to CRM for Top Performing organizations, sales personnel adoption was at the top of the list. Top Performers use system usage to gauge the effectiveness of both the sales processes and information that is available to sales reps. If information is difficult to find or processes are not automated, reps stop finding value in using the system. One key finding was that eight out of ten Top Performers rely exclusively on CRM and analytics dashboards for calculating critical metrics. These organizations have done away with spreadsheets and complicated calculations in favor of standardized and automated calculations from within a core system of record. This allows Top Performers to benchmark performance over time using consistently calculated metrics. Top Performers were also more likely than Everyone Else to automate “non-traditional” but critical metrics such as: • Speed-to-call • Speed-to-contact • Contact rate • Qualification rate • Conversion rate • Call volume • Average call time • Lead status • Average sales cycle Many of these metrics are used exclusively to gauge the effectiveness of sales processes and sales enablement training. Link process to desired outcomes. Results are a byproduct of process. All too often organizations get caught up the endless conundrum of CRM configuration. Do you customize the system to meet processes or customize processes to meet the system? From a best practice standpoint, it’s generally a good idea not to excessively customize CRM. In fact, every customization should have a valid business case for capturing custom data, and ultimately this data should be used on a regular basis to make decisions. Top Performers rank process optimization and revision as a top value driver for success. To do this, organizations should focus on processes that lead to desired results. Start with the goal, and find the most effective and efficient way to accomplish that goal. Key considerations when evaluating process changes: • Did your organization change process to fit the CRM tool? Is that working? • Are there legacy processes that no longer add value internally? • Does lack of integration with other systems impede results? • Are there bottlenecks in the flow of information that is critical to sales success?
    • Note: This document is intended for individual use. Electronic distribution via email or by post- ing on a personal website is in violation of the terms of use. Top Performing Tactics for Overcoming a Stagnating Sales Pipeline 8 Entire content © 2013 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction prohibited. Deep Dive Talking Points • Stagnating opportunities could be an indication that sales reps are not properly trained, leads are not sufficiently nurtured or qualified, or sales processes are not being followed. • For Top Performers, CRM is a source of competitive advantage for reps. CRM becomes a destination for sales people to get a leg up on deals, providing background information on accounts or contacts, lead qualification through lead scoring, insight into marketing communications and engagements, products purchased customer service interactions, etc. • A formal understanding of the customer lifecycle – from lead, to prospect, to customer – will provide a systematic way to ensure marketing, sales, and service are maximizing the lifetime value of prospects and customers. • Every customization in CRM should have a valid business case for capturing custom data, and ultimately this data should be used on a regular basis to make decisions.
    • Note: This document is intended for individual use. Electronic distribution via email or by post- ing on a personal website is in violation of the terms of use. Top Performing Tactics for Overcoming a Stagnating Sales Pipeline 9 Entire content © 2013 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction prohibited. Headquarters Gleanster, LLC 825 Chicago Avenue - Suite C Evanston, Illinois 60202 For customer support, please contact support@gleanster.com or +1 877.762.9727 For sales information, please contact sales@gleanster.com or +1 877.762.9726 Related Research Recently published research that may be of interest to senior industry practitioners include: Gleansight: CRM for Small and Midsize Businesses Gleansight: Integrated Customer Relationship Management Deep Dive: 7 Imperatives for Embracing Social Media in Sales Deep Dive: How Top Performers Synchronize for Success in Cross-Channel Customer Service Deep Dive: Measuring the Impact of Lead Nurturing on the Sales Pipeline The Gleanster website also features carefully vetted white papers on these and other topics as well as Success Stories that bring the research to life with real- world case studies. To download Gleanster content, or to view the future research agenda, please visit www.gleanster.com. About Gleanster Gleanster benchmarks best practices in technology-enabled business initia- tives, delivering actionable insights that allow companies to make smart business decisions and match their needs with vendor solutions. Gleanster research can be downloaded for free. All of it. For more information, please visit www.gleanster.com.