Quick question : what’s the #1 most overlooked factor in increasing win rates ?
Hiring better salespeople ? Developing more compelling proposals ? Qualifying better/harder ? Lowering your prices ?
(Answer : none of the above).
Recent research from RAIN Group suggests that one of the most powerful factors for increasing win rates is this : improve your sales process.Increasing win rates equals improving your sales process. Click To Tweet
It’s that simple.
The 5 Levels Of Sales Process Development
Unfortunately, most of us have got a long way to go when it comes to sales process improvement. According to our research, only 49% of organisations have formally defined their sales process. In the RAIN Group research, we identify five levels of sales process development:
- Ad Hoc (Chaos): No consistent process or framework for planning to win opportunities.
- Emerging: Some consistency and planning framework, but still work to do to standardize it and make it complete.
- Defined: Our opportunity management process is defined and we have a tool to guide us to win opportunities.
- Managed (Adoptive): Number 3, plus it’s easy to use, includes specific details and guidance for selling, the process is managed well and helpful to sellers.
- World-Class (Adaptive): Number 4, plus it’s always being measured and improved, it includes best practices for strategies and tactics across the sales cycle, and the process and planning tools are embedded in sellers’ work ow and technology.
As the research indicates, roughly half of the sales organizations don’t even make it to Level 3 – Defined. Now if you’re a sales manager, you might say, “Ago, I agree. But we’ve done OK thus far, so why the need to improve ?”
Here’s why: you’re leaving money on the table. And quite a bit of it too.
But don’t take my word for it – check out the graph below.
Notice anything ? As the maturity of the sales process increases, so does the average win rate. Organisations with a world-class sales process have a 30% higher win rate, and lose far fewer deals to competitors and the dreaded « status quo ».
Think about this for a second: what if you were able to increase your win rate by just 10 % ? What would that do for overall revenue growth ? Margins ? Bottom line profits ? Seller motivation ? Your own career ?
Most sales managers would give anything for an increase like that – but many fail to understand that increasing win rates is really all about executing on the fundamentals.
In fact, the research suggests that the more mature the sales process, the more likely organisations were to grow revenues by 20% or more. That’s fully one-fifth revenue growth.
What if you could make that happen ?
Increasing Win Rates : One Step At A Time
Now, granted, putting in place a smoothly running sales process is not easy – and you certainly can’t just go from « no sales process » to « world class » in a single step.
Your first job is to find out where your organisation currently ranks. At its most basic, that means conducting an internal assessment of your sales process, and asking the following five questions :
- Do we have a sales process in place ? If so, is it clearly defined ?
- Is it known and communicated throughout the organisation ?
- Is it used consistently across the organisation ?
- Is it supported by the necessary tools, definitions and frameworks ?
- Are we consistently searching for ways to improve upon it ?
If you’re on Level 1-2, your first order of business should be to define your sales process. That’s not rocket science. All it takes is working out a basic, defined process for managing sales opportunities, and ensure it’s implemented in a coherent fashion across the organisations.
With time, taking (just) that first step should result in substantial increases in competitive wins. But by all means, don’t stop there.
If you’ve already defined your sales process, the next step is to get to Level 4 – Managed. That means building things like playbooks, checklists and job aids to ensure sellers don’t have to keep reinventing the wheel, and remember long lists off the top of their heads.
As Atul Gawande, author of « The Checklist Manifesto », observes « under conditions of complexity, not only are checklists a help, but they are required for success. The checklist gets the dumb stuff out of the way » – meaning sellers can focus on executing against high added-value activities with their buyers.
Finally, if you’re already operating at Level 4 (congratulations), it’s really all about committing to continuous, incremental improvement. The difference between a process at level 4 versus level 5 is that the process is “continuously improved, supports maximum value for buyers, and consistently helps sellers win sales and develop deep relationships with buyers.”
This is the pinnacle of the pinnacle. Only 8% of all organizations get here. But when they do, the results are impressive.
In 2016, there really is no excuse to not have a formally defined sales process. The knowledge, tools and frameworks are all there. Start there to get the basics in place.
However, the truly defining factor in increasing win rates is not just to have one, but to have one that works, and that is implemented consistently across the organization. And then to keep tweaking it, fine tuning it and ensuring it’s continually developed and enhanced.
After all, as Salvador Dali once said “Have no fear of perfection. You’ll never reach it”.