Why are sales leaders still struggling to help their reps manage their pipelines?
Managing pipelines is a primary responsibility for every sales manager. But, a study by Vantage Point Performance and the Sales Management Association recently revealed that sales leaders are struggling. The same study also showed that organizations with effective pipeline management focus on the fundamentals:
- Establishing a consistent process
- Training sales leaders
- Making time for pipeline management
My friend Jason Jordan is a partner at Vantage Point Performance and shares some of his key takeaways from this study below. For more tips from Jason, check out his Amazon.com best-selling book “Cracking the Sales Management Code” or follow him on Twitter or LinkedIn. Here’s the article from Jason:
Since so many companies have sales pipelines, you’d think that there would be a well-worn set of pipeline management best practices for sales managers. Even if that is the case—and I don’t believe it is—do you know how many sales leaders struggle to manage their pipelines? An overwhelming majority, apparently.
In recent research we conducted with the Sales Management Association, 56% of executives confessed that their organizations were ineffective at managing sales pipelines. Their companies waste a lot of time staring at pipeline reports, but this effort yields no increase in sales performance.
Not good news. Fortunately, you don’t have to do a lot of head scratching to improve the effectiveness of your team’s pipeline management. Our research also revealed insights that provide a solid framework to do just that.
Creating Clear Sales Processes
We discovered that sales teams that invested the time to define credible standardized sales processes demonstrated the best pipeline management. More specifically, these teams had sales processes with clearly defined stages that were universally understood by all their salespeople. There was no guesswork as to which stage a deal belonged in, and everyone felt confident about the data in the CRM tool. In short, there was a strong backbone for effective pipeline management and a solid sales process with clearly defined stages.
Committing Time to Managing
Building on a solid sales process, the next step to effective sales pipeline management was a focus by front-line sales managers to spend enough time managing. In fact, companies in our survey that spent at least four hours per month managing each rep’s sales pipeline realized 14% greater revenue growth than those that spent less than one hour per month.
Unfortunately, many sales managers believe they spend a lot of time managing their sales pipelines when they really spend a lot of time creating forecasts. There are some significant differences. If you are spending your time discussing close dates, probabilities, and deal sizes, then you are forecasting. Period. However, if you are spending your time discussing the overall health of your sellers’ pipelines and how they can shepherd more deals to successful closure, then you are managing your pipeline in a productive way, and you’ll likely see improved sales performance.
Training Sales Managers in Pipeline Management Strategies And Technique
Our research discovered that 61% of executives admit their sales managers have not been adequately trained to manage their sales pipelines. This is a revealing admission. Sales teams that say they have properly trained their sales managers in pipeline management strategies and techniques reported 23% greater revenue growth than those who had not. It’s simple logic. How can we expect our sales managers to do something well when we haven’t trained them how to do it?
So, the lessons from our research are very clear. Most sales forces are not good at managing their sales pipelines. However, those that are lay a foundation of processes, training, and management that lead to better-managed pipelines and superior revenue growth. They define solid sales processes that are clear and credible. They set aside time to actively manage their sales pipelines and not just forecast revenue. And finally, they train their sales managers on how to manage their sales pipelines. Look at this formula for successful pipeline management and ask yourself how your sales force stacks up.
If your company’s sales leaders are struggling to manage the sales pipeline and grow revenue, I can help! Call me at 775-852-5020 or schedule time to chat about it.
Alice is nationally known for her expertise in elevating sales to increase valuation for companies with a B2B complex sale that have exceptional growth potential. She’s originally, from the widely known Miller Heiman Group. Spending her time strategizing with CEOs and their leadership teams to build the strategies that find new business and grow existing accounts is her passion. Her clients love her spirit and the way she energizes their sales organization.