Welcome to Q1!

It’s All About Pipeline

For many companies, it is early in Q1. At the end of last year, deals were closed, opportunities were pulled forward, the pipeline was emptied. Everyone took a breather.

So now we’re in Q1. Kick-off is over, sales people have been reinvigorated, tans are fading, and it’s time to get back to work.

Territories have been assigned, accounts have been allocated, SCs are chomping at the bit.

So…in most sales organizations, reps are conducting the traditional process of separating their accounts into three groups – “A”s, “B”s and “C”s. A accounts hold the most opportunity or promise, B accounts have some promise, and typically, C accounts aren’t well known or understood.

In my experience, most of the segmentation is based on simple (yet flawed) criteria:

• Prior engagement
• Good set of contacts
• Existing install base
• Strong revenue growth
• Easy commute from rep’s house or office

Occasionally a long targeted account will be classified as an “A” because “this year we just have to capture that logo!”

Despite the availability of extensive firmagraphic and intent data, few accounts are appropriately targeted based on their business requirements. Targeting is still an inside-out activity, started from scratch annually or when reps turn over.

So…it’s too late to fix that problem this quarter. Lets assume that we have a defined set of accounts and sales people with time, interest and energy. Now is the time to make the investments that ensure strong customer engagement and a healthy, active pipeline later in the year.

Building A Strong Pipeline

 If you don’t know where you’re going, any old path will do…
A good house requires a strong foundation…
A quality paint job is 90% preparation…

And in the same theme, a strong pipeline consists of individual pursuits based on the identification of real business requirements and engagement with stakeholders. It simply isn’t built on hope!

Many sales organizations count on marketing to deliver sufficient numbers of SQLs for follow up…even though somewhere between one and two thirds of there leads are self-generated.

Building that robust pipeline requires an iterative process for reps and managers – researching accounts, building hypotheses about business value and stakeholders, testing those hypotheses, creating access points, delivering value to the participants so that they stay engaged and supportive. While this process is effective, we have seen it implemented in few organizations.

Selling does not have to be adversarial. With good knowledge of the customer’s business goals, needs and challenges, a sales team can build value-based relationships and help their customer to achieve those goals more quickly and efficiently. In turn, the sales team will shorten sales cycles and improve deal profitability.

Building robust pipe requires executive commitment, experienced guidance, engaged sales management and a bit of patience. So, if the path is understood and the challenges are known, why aren’t more organizations making these investments?

Thanks,

Lee

This Fourth Quarter

This fourth quarter is the most important of the decade.

Two weeks ago Ben Bernanke stated that the recession is probably over. Housing starts are up. The leaves are turning (at least in New England) and business people are starting to believe that the light at the end of the tunnel may be something other than an oncoming train.

We are all breathing a collective sigh of relief. It has been a difficult year...and for many, with the official unemployment rate scraping 10%, challenges remain.

Yet a sense of optimism is evident. And just as I predicted early in the year, budgets are now starting to open up. Mostly marketing and sales budgets, by the way. There hasn't been a general unleashing of capital investments or discretionary spending. That will come later, in mid-2010 and beyond. For now, the increased spending is coming from organizations that want to position themselves for success in 2010.

And that's why this quarter is the most important of the decade. The results of this quarter will drive discretionary investment decisions in 2010. If you want to have a good 2010, you must deliver the goods this quarter. Success in this quarter will help to ensure access to funding for the next quarter and the quarters beyond that. Mediocre or poor results this quarter will cause a significant rethink of sales and marketing strategy.

Many C-level executives and corporate boards are thinking: "Okay, you've had a year to figure out the current environment and to make the necessary mid-course corrections to ensure a reasonable result by the end of the year." Prove them wrong and your successor will be working on a very different action plan, one that involves wholesale shedding of divisions or organizations, cuts that go far deeper than the 5-20% layoffs we've seen already.

There hasn't been a single more important three month stretch this decade than perhaps the fourth quarter of 2001 for the travel industry. At the time I managed a business that built and sold technology services to road warriers. Road warriers were grounded on September 11th and my business went poof. The entire travel business was reshaped in that quarter and the airline industry is very different today as a result.

Your opportunity is to prove, in the next three months, that your business is both viable and thriving. With a focus on "co-creating" value with customers, you may have a chance. Customers today don't want to be sold to...they demand consultative sales people who work with them to boost profitability, reduce costs, increase shareholder value, make a difference in their world.

The critical success factors are simple and straightforward:

• Focus exclusively on the prospects and customers who value and need your specific value proposition, your differentiator.
• Narrow this focus to those who are committed to short term improvements in their business.
• Ensure that your sales people fully understand the business processes and challenges of the individual prospect, not the group in general.
• Commit to value-adding rather than transactional behaviors. You may think that hard selling will work in this market. It hasn't for years and it certainly won't now. You might "win" a few deals but you're destroying the relationships that bring long term profitability.

Focus on making a difference in your customer's world.

Thanks,

Lee