2013 sales planning is under way with most of our clients and all them are keeping a keen eye on their sales pipeline as they enter Q4. The reality is that their Q4 qualified pipeline will be a leading indicator on how well their sales teams will perform in the first quarter of 2013, and now is the perfect time to do a pipeline reality check.
This is an exercise well worth the effort, as leaving your sales pipeline overstated puts the financial health of your company at risk even before the new sales year starts.
In your current sales pipeline its likely you have several opportunities that have started to age, and your sales reps continue to slip the close date month by month. If so, and the scenario outlined below sounds familiar, take the time to carefully review every deal that has aged more than twice your selling cycle time. For those in particular you need to determine if the opportunity should actually be removed from your forecast completely!
The deal was really looking good. The client had a need; our product or solution was a good fit; the ROI was right; the client budget was in place to fund it, and we were positioned with the person(s) that could say yes. Everything was looking great for the close and it made the sales pipeline look great! Then nothing happened. The expected decision date came and no award was made. We adjusted the close date in our CRM system and waited for the next milestone. Still no decision so we slipped the date again, and again, and again.
That no-decision result is one of the most challenging realities of sales.
We have all been there at some time or another. Sometimes decisions are delayed for legitimate reasons: new management changes priorities, the client needs changed and our product or solution was no longer valid, budget reductions occur, or the client simply cant make a decision. The simple fact is that the longer an opportunity languishes the more likely it is to die. (Time helps no sale!)
Sales professional typically know in their heart when an opportunity has died, but many are reluctant to move it to the loss category, or to reduce the win probability, because their pipelines are not large enough to absorb the loss. This problem is compounded at the sales leader level where you have a team of sales reps – each carrying a few dead or permanently dormant deals that should be removed from the pipeline.
Sales leaders, keep focused on what a huge favor you are doing yourself as 2013 sales planning unfolds. Knowing your true pipeline value is imperative to effective sales planning and revenue forecasting. Having a realistic pipeline picture will also help you make your case for any necessary investments in your team to make them capable of meeting the 2013 sales number.