Reengineer Your Sales Cycle: Reduce your time-to-sale and increase your lead-to-close rate
Reengineer Your Sales Cycle: Reduce your time-to-sale and increase your lead-to-close rate
Key Assumptions
Before we improve a company’s sales cycle, there are some key assumptions that must be understood:
1. The sales cycle must start with a clear understanding of the buyer's journey, which refers to
how decisions are made about the type of products you sell.
2. The sales cycle is a team effort between marketing and sales. The more coordination there is
between these two groups, the higher the potential of process improvement.
3. You cannot manage something you don’t measure. The cycle must be modeled, measured and managed.
Keys to Improving Your Sales Cycle
Once you have the right assumptions, there is a wide variety of tools and tactics you can use to improve practically any sales cycle:
1. Use your current process as the baseline. Customers are use to working with you in a certain
way. Before coming up with a new process, map out the current process and understand it from
the customer’s eyes. What are the steps involved in turning a lead into a closed deal? How long
does it take? How many prospects "leak" from the sales funnel at each step? What is your close
percentage for new leads? Use your current process and associated metrics as your baseline upon
which to improve.
2. Remove "self service" buyers from the sales funnel if possible. If you have markets or customer
segments that can serve themselves, set them up to do so. In terms of operations and business
effectiveness, the more you can push customers to low-cost buying channels, the better. This
frees up your sales force for value-added (and most likely higher sales) interactions with
other markets or customers. Before you start migrating your customers to cheaper channels, make
sure that this move makes sense. Consider the added value that your sales force brings to the
segment in question and assess the benefits of self-service versus retaining a more personal
touch. If the latter is making a real difference, don’t make the change.
3. Identify milestones. There are events or milestones in the sales process that can be measured.
Examples include activities like making a presentation, submitting a quote, or sending a
contract. To use these milestones as the basis for pipeline forecasting and sales activity
management, look at your historical performance and come up with tentative forecasts for
individual milestones. For example, you may decide, based on historical results that 50% of
prospects who have had demos, 70% who have received proposals, and 90% who are sent contracts,
will close. Use these numbers to forecast and assess sales results. Keep in mind that these
percentages are theoretical when starting out. Validate and adjust by collecting real data
going forward. Results will vary from salesperson to salesperson. At some point, you may want
to get more detailed in your forecasting by tracking individuals rather than the department as
a whole.
4. Remove friction from the client side. The longer prospects stay in the sales funnel, the higher
the possibility they will not buy. Brainstorm how to eliminate barriers that keep customers
from moving through the process. Start with the milestones you identified and look at ways to
improve them. For example, what will it take to reduce your team’s response time to customers?
How can demos be improved to increase the percentage of customers who move to the next step?
5. Standardize execution on the sales side. In many organizations, sales people have great
latitude when it comes to how, when, and what activities they engage in with clients. Too much
flexibility can cost you. It is important to implement standard operating procedures that
ensure prospects are handled consistently while still providing latitude to your sales
personnel. Create tools that help your reps address key objections at each stage of the cycle.
6. Fix leaks in the funnel. Some people will never buy, and there is nothing you can do about it.
However, in many cases, lack of follow-up is responsible for funnel leakage. Mobilize your
marketing team to plug these leaks by implementing contact programs with special offers aimed
at reactivating prospects. Highly personalized direct mail, email, and coupons are examples of
tactics that work to reawaken dormant leads. As with any customer-facing campaign, these
efforts must be well coordinated with the sales team to ensure that prospects are getting
consistent messages from marketing and sales. Mixed messages are confusing and make your
company look incompetent.
7. Remove stalled buyers. When buyers stall in the process, it tends to confuse the efforts of
sales people. The stalled buyers create higher numbers of people in the CRM system, which
causes the sales people to lose their ability to monitor and prioritize them. If your best
sales people are not extremely organized (and most aren’t), this dynamic can have a snowball
effect. They stop calling the high-priority buyers, spending most of their time on low-
potential contacts. You need to identify simple criteria that sales people can use to re-
categorize these buyers. Take them out of the sales follow-up funnel and put them into the
marketing follow-up funnel. Marketing can send them personalized letters, emails and sales
literature with the intention of reactivating these buyers into the sales funnel.
8. Use the carrot AND the stick. Buyers need to know what makes your product or service compelling
enough to choose over competitors. They need an offer that makes them want to respond and move
to the next level in the process (the carrot). They also need to know the bad things that will
happen when they don’t chose your company or take too long to choose (the stick). At each stage
of the cycle, marketing and sales need to communicate with buyers in a way that gently goads
them to move forward. In most cases it is client pain, or fear, that is most effective at
achieving this. Without some kind of pain, prospects are rarely compelled to buy.
9. Create accountability. Sales and marketing managers must know how their people are performing
in order to improve the process. Make sure your sales management can get detailed, relevant r
reports that cover key milestones. Timely reporting allows the manager to manage exceptions and
take action to keep prospects moving through the funnel.
Making it Happen
What makes sales cycle improvement so difficult is the cultural divide between marketing and sales. The creative personalities of marketers tend to be in direct conflict with the results-driven personalities selling face to face with the client. Marketers talk about "buzz", awareness, and impressions. Salespeople talk about closing deals. Marketers blame sales people for not closing leads while sales people blame marketers for generating poor quality leads that cannot be closed.
Sales cycle improvement requires close collaboration of these two groups. Without it, you will have little improvement. It takes strong leadership to bring these two groups together and set the tone for collaboration in a no-blame atmosphere. Given this prerequisite, marketing and sales need to hold regular After Action Reviews where, together, they review the sales scorecard. During these After Action Reviews, the sales and marketing team must identify root causes of performance, brainstorm solutions, and run experiments to test them.
With good leadership, planning, and follow through, implementing the recommendations in this paper will net greater improvements than you may be ready for.
Reengineer Your Sales Cycle Reduce your timetosale and increase your leadtoclose rate - To learn more about this author, visit Bryan Feller's Website.
Like this article? Share it with your friends
The sales cycle is a system of activities that starts when a new lead is generated and ends when a sale is booked. The key players in this system are the customer (or prospective customer), the marketing department, and the sales department. The sales cycle should not be confused with the buyer’s journey; the process the buyer goes through when he or she makes a purchase of a product similar to yours. For the sake of this article, we will focus on the sales cycle: the buying process from the viewpoint of the selling company. Like any business process, the sales cycle can be streamlined to reduce inefficiencies, decrease time between lead and order, and increase the lead-to-sale conversion rate. Here’s how:
Key Assumptions
Before we improve a company’s sales cycle, there are some key assumptions that must be understood:
1. The sales cycle must start with a clear understanding of the buyer's journey, which refers to
how decisions are made about the type of products you sell.
2. The sales cycle is a team effort between marketing and sales. The more coordination there is
between these two groups, the higher the potential of process improvement.
3. You cannot manage something you don’t measure. The cycle must be modeled, measured and managed.
Keys to Improving Your Sales Cycle
Once you have the right assumptions, there is a wide variety of tools and tactics you can use to improve practically any sales cycle:
1. Use your current process as the baseline. Customers are use to working with you in a certain
way. Before coming up with a new process, map out the current process and understand it from
the customer’s eyes. What are the steps involved in turning a lead into a closed deal? How long
does it take? How many prospects "leak" from the sales funnel at each step? What is your close
percentage for new leads? Use your current process and associated metrics as your baseline upon
which to improve.
2. Remove "self service" buyers from the sales funnel if possible. If you have markets or customer
segments that can serve themselves, set them up to do so. In terms of operations and business
effectiveness, the more you can push customers to low-cost buying channels, the better. This
frees up your sales force for value-added (and most likely higher sales) interactions with
other markets or customers. Before you start migrating your customers to cheaper channels, make
sure that this move makes sense. Consider the added value that your sales force brings to the
segment in question and assess the benefits of self-service versus retaining a more personal
touch. If the latter is making a real difference, don’t make the change.
3. Identify milestones. There are events or milestones in the sales process that can be measured.
Examples include activities like making a presentation, submitting a quote, or sending a
contract. To use these milestones as the basis for pipeline forecasting and sales activity
management, look at your historical performance and come up with tentative forecasts for
individual milestones. For example, you may decide, based on historical results that 50% of
prospects who have had demos, 70% who have received proposals, and 90% who are sent contracts,
will close. Use these numbers to forecast and assess sales results. Keep in mind that these
percentages are theoretical when starting out. Validate and adjust by collecting real data
going forward. Results will vary from salesperson to salesperson. At some point, you may want
to get more detailed in your forecasting by tracking individuals rather than the department as
a whole.
4. Remove friction from the client side. The longer prospects stay in the sales funnel, the higher
the possibility they will not buy. Brainstorm how to eliminate barriers that keep customers
from moving through the process. Start with the milestones you identified and look at ways to
improve them. For example, what will it take to reduce your team’s response time to customers?
How can demos be improved to increase the percentage of customers who move to the next step?
5. Standardize execution on the sales side. In many organizations, sales people have great
latitude when it comes to how, when, and what activities they engage in with clients. Too much
flexibility can cost you. It is important to implement standard operating procedures that
ensure prospects are handled consistently while still providing latitude to your sales
personnel. Create tools that help your reps address key objections at each stage of the cycle.
6. Fix leaks in the funnel. Some people will never buy, and there is nothing you can do about it.
However, in many cases, lack of follow-up is responsible for funnel leakage. Mobilize your
marketing team to plug these leaks by implementing contact programs with special offers aimed
at reactivating prospects. Highly personalized direct mail, email, and coupons are examples of
tactics that work to reawaken dormant leads. As with any customer-facing campaign, these
efforts must be well coordinated with the sales team to ensure that prospects are getting
consistent messages from marketing and sales. Mixed messages are confusing and make your
company look incompetent.
7. Remove stalled buyers. When buyers stall in the process, it tends to confuse the efforts of
sales people. The stalled buyers create higher numbers of people in the CRM system, which
causes the sales people to lose their ability to monitor and prioritize them. If your best
sales people are not extremely organized (and most aren’t), this dynamic can have a snowball
effect. They stop calling the high-priority buyers, spending most of their time on low-
potential contacts. You need to identify simple criteria that sales people can use to re-
categorize these buyers. Take them out of the sales follow-up funnel and put them into the
marketing follow-up funnel. Marketing can send them personalized letters, emails and sales
literature with the intention of reactivating these buyers into the sales funnel.
8. Use the carrot AND the stick. Buyers need to know what makes your product or service compelling
enough to choose over competitors. They need an offer that makes them want to respond and move
to the next level in the process (the carrot). They also need to know the bad things that will
happen when they don’t chose your company or take too long to choose (the stick). At each stage
of the cycle, marketing and sales need to communicate with buyers in a way that gently goads
them to move forward. In most cases it is client pain, or fear, that is most effective at
achieving this. Without some kind of pain, prospects are rarely compelled to buy.
9. Create accountability. Sales and marketing managers must know how their people are performing
in order to improve the process. Make sure your sales management can get detailed, relevant r
reports that cover key milestones. Timely reporting allows the manager to manage exceptions and
take action to keep prospects moving through the funnel.
Making it Happen
What makes sales cycle improvement so difficult is the cultural divide between marketing and sales. The creative personalities of marketers tend to be in direct conflict with the results-driven personalities selling face to face with the client. Marketers talk about "buzz", awareness, and impressions. Salespeople talk about closing deals. Marketers blame sales people for not closing leads while sales people blame marketers for generating poor quality leads that cannot be closed.
Sales cycle improvement requires close collaboration of these two groups. Without it, you will have little improvement. It takes strong leadership to bring these two groups together and set the tone for collaboration in a no-blame atmosphere. Given this prerequisite, marketing and sales need to hold regular After Action Reviews where, together, they review the sales scorecard. During these After Action Reviews, the sales and marketing team must identify root causes of performance, brainstorm solutions, and run experiments to test them.
With good leadership, planning, and follow through, implementing the recommendations in this paper will net greater improvements than you may be ready for.
Reengineer Your Sales Cycle Reduce your timetosale and increase your leadtoclose rate - To learn more about this author, visit Bryan Feller's Website.
Like this article? Share it with your friends
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George LudwigGeorge Ludwig is a recognized authority on sales strategy and peak performance psychology. An international speaker, trainer, and corporate consultant, he helps clients like Johnson & Johnson, Abbott Laboratories, Northwestern Mutual, CIGNA, and numerous others improve sales force effectiveness and performance. Though it's George's strategies and processes that help corporations increase productivity and performance, it's his tremendous energy and dynamism that spark the transformation. Again and again, clients remark on his amazing ability to unleash human capacity and inspire men and women to break out of their comfort zones. The result is a whole new type of salesperson. His customized presentations teach achievers to make stunning advances in their lives. From helping salespeople realize cherished dreams to helping corporations exponentially accelerate revenue streams, George Ludwig leaves audiences and individuals empowered, emboldened, and clamoring for more. George is the best-selling author of Power Selling: Seven Strategies for Cracking the Sales Code and Wise Moves: 60 Quick Tips to Improve Your Position in Life & Business. - Visit George Ludwig's Website |
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David AchesonDavid Acheson is the founder of DCJA Consultancy. DCJA Consultancy is a management consultancy business specialising in B2B sales consultancy. They offer bespoke and packaged sales consultancy including Sales Optimisation Review, Interim Sales Management, Sales & Marketing Review, 1:1 Sales & Management Staff Analysis, Management Training, Solution Sales Training, Creation of New Pay Plan, KPI's, run Customer Feedback Campaigns, assist with Recruitment, Coaching, Appraisals and set up Strategic Marketing Campaigns. David spent his early career in accountancy and then moved into sales in 1982, working in Office Equipment, IT, Advertising, Training, Outsourcing and Consultancy. He has held many Senior Positions in SMBs and Global Organisations including Head of Sales Operations & Head of Business Development. His knowledge, skills and great experience of the Sales Industry has led to David making keynote speeches and running educational sessions to key businesses through organisations including The Chamber of Commerce and Business Link. - Visit David Acheson's Website |
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Dave KurlanDave Kurlan is the founder and CEO of Objective Management Group, Inc., the industry leader in sales assessments and sales force evaluations, and the CEO of David Kurlan & Associates, Inc., a consulting firm specializing in sales force development. Dave has been a top rated speaker at Inc. Magazine's Conference on Growing the Company, the Sales & Marketing Management Conference and the Gazelles Sales & Marketing Summit. He has been featured on radio and TV, including World Business Review with General Norman Schwarzkopf, in Inc. Magazine, Selling Power Magazine, Sales & Marketing Management Magazine and Incentive Magazine. He is the author of Mindless Selling and Baseline Selling – How to Become a Sales Superstar by Using What You Already Know about the Game of Baseball. He created and wrote STAR, a proprietary recruiting process for hiring great salespeople, and he writes Understanding the Sales Force, a popular business Blog and is a contributing author to The Death of 20th Century Selling and 101 Great Ways to Improve Your Life, Volume 2. - Visit Dave Kurlan's Website |
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Leanne Hoagland-SmithAre your sales where you want them to be? Will you be one of the few who achieves sales or business success or one of the many who have failed to change? Are you tired of being told you are like everyone else? Then you may find my first book on sales of interest. Be the Red Jacket in the Sea of Gray Suits, The Keys to Unlocking Sales available at Amazon or at http://www.processspecialist.com/red-jacket.htm. This book is a reflection of my no-nonsense approach to improving sales to overall business results. If you are truly committed to making sustainable changes, then I can help you secure a positive return on your investment because I focus on executable solutions not telling you the problems you already know you have. From training to corporate (group) coaching to executive one on one coaching, my approach is to assess, create awareness, build a goal driven action plan and then execute. The bottom line question is "Not do you or your employees know it, but do you or they want to do it?" Please call for a free strategy session at 219.759.5601. - Visit Leanne Hoagland-Smith's Website |
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Linda RichardsonLinda Richardson is the Founder and Executive Chairwoman of Richardson, a global sales training and performance improvement company. As a recognized leader in the industry, she has won the coveted Stevie Award for Lifetime Achievement in Sales Excellence and she was identified by Training Industry, Inc. as one of the “Top 20 Most Influential Training Professionals.” Ms. Richardson is credited with the movement to Consultative Selling and is the author of ten books on selling and sales management, including Sales Coaching — Making the Great Leap from Sales Manager to Sales Coach, and Stop Telling, Start Selling. She teaches sales and management at the Wharton Graduate School of the University of Pennsylvania and the Wharton Executive Development Center. Linda is a frequent speaker at industry and client conferences, has been published extensively in industry and training journals, and has been featured in numerous publications, including The Wall Street Journal, Forbes, Nation’s Business, Selling Power, Success, and The Conference Board Magazine. Learn more about Richardson's sales training and performance improvement solutions at http://www.richardson.com web - Visit Linda Richardson's Website |
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John BrennanJohn Brennan Ed.D. Dr. Brennan is President of Interpersonal Development, LLC, a training and development firm. Interpersonal Development has provided sales training and coaching to more than 3,000 sales reps from over 100 companies. A native of Australia, Dr. Brennan received his doctorate from the University of Rochester. His dissertation researched the effectiveness of Behavioral Modeling Technology in training people in interpersonal skills. While he has spent most of his career designing or delivering training, he was also a Vice-President of Sales of a training and development franchise with operations in 25 markets. Dr. Brennan has designed and delivered sales training in North America, Asia, Europe, Australia and the Middle East. He has been a guest speaker at numerous national and regional professional conferences. When Microsoft wanted Best Practices articles on sales for their web site, they called Dr. Brennan. The results are at http://office.microsoft.com/en-us/FX011387391033.aspx His firm’s clients have included Volvo, The Prudential, Merrill Lynch, Eastman Kodak, Gannett, Equifax Europe, the Economist Group and countless small businesses. - Visit John Brennan's Website |
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Anne BarrAnne Barr has over 26 years experience in sales and marketing, six years as a franchisee. She has assisted over 367 business owners and purchasers to achieve their goals in career change, transition and exit strategy. She holds the designation of Certified Franchise Executive from the International Franchise Association, Certified Business Intermediary from the International Business Brokers Association and Board Certified Broker from the Texas Association of Business Brokers. Anne is active in professional organizations, networking groups and volunteers for non-profit entities. As owner/operator of four successful businesses, Anne has proven people skills and enjoys helping clients find the right "fit" in business ownership. Visit www.FranchiseOpportunitySpecialist.com for more information about me and my company. - Visit Anne Barr's Website |
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