Does your business have a formal sales process? If not, then the probability is high that you’re running short of your full potential. Revenues are like bloodline for companies, the flow of which keeps companies running. Underestimating your potential can lead to dry up that bloodline. In a recent HBR.org article titled “Companies with a Formal Sales Process Generate More Revenue”, Jason Jordan and Robert Kelly explain why it’s critically important to define a process, stick to it, and train your sales team accordingly.
Jason Jordan and Robert Kelly have shed some light on how with just three practices you can formalize a sales process, create your dream team along with efficient pipeline, and boost your revenue.
1. Define the process
2. Dedicate your time for pipeline management
3. Train sales managers on pipeline management
Sales Pipeline represents the Sales Process of a company. A definite and credible pipeline leads to effective pipeline management. Pipeline Management draws the outline for how the sales pipeline design should be, how it should be measured, and how it should be optimized to drive sales rep performance. If Salespeople invest a bit more time on formalizing and validating their sales process, they are able to discover that they can perform more actively resulting in a better revenue generation. As quoted,
“There was an 18% difference in revenue growth between companies that defined a formal sales process and companies that didn’t.”
So the must-ask question is- Does your company have a formal sales process? Does it follow that process? But before that, there is another question we should know the meaning of- What does it mean to have a formal sales process? In simple terms, define your steps clearly. The stages of your pipeline should be precisely predetermined and communicated to your salespeople so that they don’t be wandering around to find what to do next. They must know where the deal stands and how they are going to manage the deal in each step. Customer’s buying process is another aspect to take here into consideration. You should align your sales process throughout with customers moving through their buying process. If you expect some extraordinary results from your Sales Team, you have to design a sales process for them with some extra attention. The key is to understand what your sales team needs and then design your unique process.
Your process is all set. What does it need next? Dedicated time and resources. Setting your process flow and leaving it be is a big No. The sales process is a continuous course of action. That’s why it needs to be dynamic, and to make it happen you should invest your time and resources to carry it out well. As quoted from the survey,
“Companies in our survey that spent at least three hours per month managing each rep’s sales pipeline saw 11% greater revenue growth than those that spent fewer than three hours per month.”
But success doesn’t depend on ‘how much’ time you are spending on pipeline management. It’s more about ‘how’ you are spending it. When it looks like the sales team is spending a lot of time managing their pipelines, they are, in reality, spending that time on creating forecasts. Whether you are talking about close dates, or discussing probabilities or deal size, you are purely forecasting. The discussion we are expecting here you are supposed to spend time on is about the overall health of your sellers’ pipelines and how they can drive more deals to fruitful closure. It is a productive way of managing your pipeline. The sales meetings should be focused more on helping reps defining the plan for moving deals forward.
This research discovered that 61% of executives admit that their sales managers are not trained effectively in pipeline management, including strategies and techniques. The question arises- How are sales managers expected to do something they are not prepared to do?
“Companies that had trained their sales managers to manage their pipelines saw their revenue grow 9% faster than those that didn’t.”
Training is not fruitful until it’s well-targeted- targeted to address the specific challenges in managing the pipeline. Most of their training revolves around how to log in to their CRM and generate reports. Their training should focus on enhancing their capacity to make better decisions for pipeline management. You can concentrate on developing their abilities to determine the ideal pipeline size for each rep, to know at what point their actions show the biggest impact, to structure pipeline meetings to enable coaching rather than inspecting. Honing their small skills can make a greater impact on overall sales performance.
In a nutshell, pipeline management is a critical activity, and if handled sensibly, can improve sales performance and earn the company some impressive revenue.
There are various tools available for pipeline management. If you can optimize them in your current flow, the results are surprisingly good. For example, Our Bolt Kanban is available Free on AppExchange that helps you visualize Sales Pipeline as well as Forecast.