Your path to revenue growth begins with your ability to fill your pipeline. Without a full pipeline, growth isn't likely. It's easy to believe that generating more opportunities is the best strategy, which is why some sales leaders require 300 percent of goal. However, the comfort of looking at more opportunities than you need often produces a false confidence.
By contrast, having too few opportunities is a leadership and accountability problem. When a pipeline has too few opportunities, it suggests the salesforce lacks effectiveness. A full pipeline contains opportunities that are valuable to the sales organization. It is also made up of companies that will see an improvement in results by changing.
Why a More-Opportunities Strategy Fails
More isn't better than better. A full pipeline is only healthy it when contains the right opportunities. The strong desire to command your sales force to find deals stems from the belief that sales is a numbers game. A numbers game is a hard game to win. One leader demanded his team generate a pipeline of 800 percent of their growth target. He expected his team would close 12.5 percent of their deals. Filling your pipeline only to lose nearly 90 percent of it is not a strategy. It's desperation. It's also a way to ruin a pipeline and a sales force.
In the context of goal attainment, the quality of your opportunities is a more significant variable than the quantity of them. The sales force tasked with creating more opportunities spends a lot of time with companies that will not buy from them. The salespeople book meetings and have nice conversations. They register the client opportunity in their CRM (customer relationship manager), only to move on to the next meeting, where they repeat the process. The full pipeline is worthless because it lacks integrity. At some point, the sales leader interrogates their sales team about when they will close deals. If they’re playing a numbers game, then that’s like asking them when they will win at the roulette table.
Effectively Filling the Pipeline
One way you improve your pipeline is by increasing the quality of the opportunities. Unfortunately, too many sales leaders allow their teams to identify an opportunity based only on the fact the contact sat through the first meeting. Unless the client is compelled to change and interested in pursuing that change with your salesperson and your company, you can remove the opportunity from your CRM without losing anything.
A full pipeline of opportunities with companies pursuing better results is infinitely better than one full of non-opportunities.
There is every reason to reject qualification strategies that repel your contacts. From a client perspective, being asked about budget, authority, need, and timeline isn't a great experience. You should always be qualifying, but there are three actions you can take to fill your pipeline and improve your results.
- Eliminate Bad Opportunities in Advance: This strategy is a form of pre-qualifying prospective clients. Your team needs to know what you don't want and won’t accept. For example, there are always companies that can't or won't invest enough to improve their results. If low price isn't your model, you can eliminate them. You can also reject deals with companies with poor cultures, the kind where the client doesn't value their suppliers. There is no reason to bring a nightmare client into your company.
- Use Territory and Account Plans: Too often, sales leaders allow their teams to call on any company in their territory. Filling your pipeline with the right opportunities requires salespeople to identify and pursue the most valuable prospective clients. Quality opportunities are better than the counterfeit opportunities you find in the typical CRM. Calling your shots is a better approach. A territory and account plan improves the quality and integrity of the pipeline.
- Increase Your Team's Effectiveness: You need fewer opportunities when you increase your sales team's effectiveness. The sales team with a win rate of 12.5 percent is doing as well as someone responding to an unsolicited RFP (request for proposal). Increasing your effectiveness to something closer 40 percent is a better strategy for filling the pipeline and netting out the revenue you need to hit your targets.
An effective strategy to filling your pipeline balances the need to have enough opportunities with the need for having high-quality opportunities.
How to Reset Your Pipeline
The first way to take control of your pipeline is to remove expired deals. Any deal allowed to live in your CRM double the average of your sales cycle can be removed without harming your results. That's too long with no activity. This doesn't mean the salesperson can't pursue the client. It means they need to reengage and restart the conversation.
You can also clean up your pipeline by asking why the client is compelled to change and why they need to do so now. Any answer that doesn't prove the client is serious about change means the deal is suspect. A company compelled to change will show activity from week to week. A lack of activity indicates not only that the client isn’t serious, but also that the salesperson has an effectiveness problem.
Your client list is a verification of your team’s effectiveness. The sales organizations that win the most desirable clients do so because they are effective. Ineffective sales organizations don’t create value, so clients remove them from consideration.
Finding the Balance When Filling the Pipeline
If it is easy to fill your pipeline, you should be concerned. Something is wrong if opportunities are flooding in. By contrast, you also don't want weeks to pass without adding to the pipeline because you risk having too few opportunities to ensure your goals. Look for the middle way, a balance of quality and quantity.