Sales Stages to Nowhere

by Chris Arlen on March 29, 2011

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Sales Stages are for novice sales reportingAlmost every sales managers, or sales consultant, uses a selling cycle with stages as part of their repertoire. Some are downright obsessive requiring salespeople to ride through Step 2C before heading onto 3A. The belief is if you have a defined path with a finite number of steps then selling is only a matter of working that process hard and diligently.

I don’t believe that anymore.

Selling is more about buyers, buying, and sellers’ relationships with those buyers. The qualitative state of buyer-seller relationships doesn’t fit into stages of a cycle, whether that’s a selling cycle or even a buying cycle.

A selling cycle is a set of training wheels – once you’re past the basics there’s not a lot of value to them. And if you’ve been selling for more than five minutes your training wheels are definitely off.

Stages, Cycles & Visibility into Potential Sales

The reason the selling cycle is still around is for sales management. Stages in the cycle are either Yes or No. You can count opportunities (leads, suspects, prospects, whatever you call them) and populate each stage of your cycle. This fits the reporting bill for sales management, which wants to:

  • see if they’re going to make their numbers next period
  • have enough in the “pipeline” of new business coming their way
  • manage sales staff  by motivating, hiring, or firing

But the primary need of sales management is for an accurate picture of the likelihood of sales – the life’s blood of every business. The more accurate that information, the greater the confidence and the less the anxiety.

A Plugged Nickel’s Worth of Numbers

Unfortunately, stages of a cycle don’t describe what’s truly going on between buyers and sellers relative to potential sales. You and I both know this to be fact. How many times has your pipeline been plumb full of juicy numbers in all stages and at the end of the year, or quarter the sales won were sickeningly few and meager?

So the real indicator of sales success, the state of the buyer-seller relationship, goes unseen and therefore unreported.

Stop reporting numbers in sales stages?

No.

While pipeline numbers are not the main indicator of potential sales that doesn’t mean getting rid of them.

However, it’s important to realize if the goal is to fill the pipeline with numbers, that’s what you’ll get –  numbers in pipelines. But is that providing better insight into your pipeline? Is that helping sales reps become more successful selling, or selling more?

I can hear the old refrain already – “selling is a numbers game, keep the pipeline filled and results will come”. Yes, this  can be true at the novice level. But it only takes one year of high pipeline numbers with few resulting sales to stand that saying on its ear.

Numbers in your sales cycle are like PSI (pounds per square inch) of air in your tires. You need to have enough to keep the tires rolling….and… full PSI helps your tires roll better, i.e. more sales opportunities. But like a car with well filled tires, there’s no guarantee of where it’s going. Could be off a cliff, or up to the valet at a five-star resort.

Therefore, reporting numbers in sales stages continues, it just shouldn’t be the sole focus or determinant of your selling efforts.

Sales reporting on buyer-seller relationships

The real focus, the real sales work must go on the qualitative state of buyer-seller relationships. And with that comes the need for a better form of sales reporting. One that more accurately presents potential sales.

This new type of sales reporting could indicate the state of buyers’ relationships to you, the seller, as well as their intent to buy. For example, is the buyer:

  • Unaware of your company (do they even know you personally)?
  • Indifferent to service areas they should be fixing or improving (can you talk with them about it)?
  • Motivated to finding solutions to fix their pains or make gains? (are you a credible help)?
  • Engaged in getting their firm to make a buy (are they sure of your commitment)?

Full pipeline is only an ante into the game

I’ve learned that my time and efforts have a far higher payoff when I pay more attention to the qualitative state of my buyer-seller relationships than merely the numbers.

By paying attention to how many buyers are indifferent to me, awake to fixing pains and making gains, motivated to find out how to do that, and engaged in making this happen tells me a lot more about

  1. what I should be doing next as the seller, and
  2. how many real sales are in the near future

This idea of sales reporting on the buyer-seller relationship may be a rather esoteric idea to some. However, the longer you’ve been selling you’ll immediately recognize the buyer-seller relationship as the true indicator of short and long term success. Sales reporting just needs to catch up to that fact. Once reporting is there, the rest of the herd can follow.

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Chris Arlen
President, Revenue-IQ

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{ 2 comments… read them below or add one }

Bill Todd March 29, 2011 at 12:26 pm

Hi Chris: I couldn’t agree more with your comments. The relationship is key, key, key. In the context of the commercial cleaning business, there is also various levels within the prospect organization that require CRM, and frequently that requires a deliberate and corordinated effort, with assignments made from the building operators to senior management, and lots of communication.
We find as well that sometimes the great relationships get less attention. Sure, the lunches continue etc., but sometimes we will make an effort to formally thank them for the relationship, spelling out the behaviours on their part that make it a great relationship. We will do this in a way that impacts their whole team, not just our direct contacts, e.g a pizza lunch for the whole office.
Always enjoy the blog Chris.
Kind Regards,
Bill Todd

Chris Arlen March 29, 2011 at 12:34 pm

Bill, isn’t that funny but true – the great relationships become more “personal” in that they become our friends and at the same time we back off the formal, or “business” side of that relationship. Guess there’s always the need to keep up the formal side of business communications, even after buyers have become our “friends”. Thanks for your comments.

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