Just finished one of those “aha” conversations with a client. Thought I would share the concepts with you.
One of the things I pay a lot of attention to, as I review pipelines or deal strategies, is the Target Close Date, and how many times that date has been changed.
I believe sales people should do everything possible to:
- Identify the most realistic target close date possible.
- Do everything possible to keep that date sacred.
Sadly, most target close dates seem to be unrealistic and meaningless. They are driven by what a sales person (or their manager) wants or needs, but have little to do with the customer need to buy.
Then as the customer embarks on their buying journey and we execute our sales process, as things get delayed, as priorities shift, the target close date shifts and shifts and shifts…..
Some years ago, I was looking at a major deal at a client. It was a huge deal, it would make the client’s quarter. Yet as I looked at it, the target close date had changed 11 times in 11 months—the pattern was at the end of each month, the sales person would slip the target close date 30 days. The sales person had no idea when the customer would make a decision and just kept slipping it, thinking, “Hopefully they will make a decision next month.”
How do we keep the target close date sacred?
First, we set the target close date incorrectly. We set it based on what we want or need, perhaps tempered by our experience. For example, we have an average sales cycle of 90 days, so we arbitrarily set the target close date 90 days out.
The target close date needs to be driven by the customer need to buy! It must be driven by understanding, with the customer, when they need to have a solution in place and what the consequences are of missing that target date.
Ironically, this is part of qualifying an opportunity. We have to know this stuff to have a qualified opportunity! We have to know this stuff to help the customer navigate their buying process to achieve their goals when they need to achieve them.
Second, we know things slip. The customer may shift priorities, they may lose their way in the buying process (hopefully we are minimizing that through our coaching), unanticipated barriers emerge. The plan the customer and we put in place falls apart.
But this isn’t new news, it happens all the time both in buying situations and in normal projects the customer undertakes. But if we and the customer continued to slip our deadlines, we would never achieve anything.
The buying/selling journey is a project. And to manage projects effectively we need to put strong project plans in place. In developing strong project plans, we typically identify milestones or stage gates, we look at the critical paths, we build some buffer into the plan, so that we are more likely to hit our goals.
But stuff happens, and we get behind schedule. There’s the temptation to slip the project completion date, but then that slip has huge consequences to the customer. They may miss a product launch commitment, they may miss customer commitments, they may not have the support systems in place to support a major change. They may be in violation of a law or compliance issues. Any slip has serious consequences to the customer and their ability to meet their goals/commitments.
We need to use the same tools and processes in helping our customers in their buying journeys. We need to help them keep that target completion or close date constant—after all, we’ve already identified the consequences to them for missing it. We need to help them rethink their buying process to keep them on target with achieving their goals.
Great project managers recognize this. As they see project plans slipping, they don’t slip the target completion, if they possibly can avoid it. What they do is adjust their project plan. They start at the target completion date, keeping that constant, and work backwards, changing the project plan to meet their goals.
Of course things will slip due to things outside the customer’s and our control. But our job, with the customers, is to minimize this, to help the customer manage it, to focus on the customer’s abilities to achieve their goals.
It really isn’t that tough, project managers do that all the time. It’s nothing new, though I suspect this type of thinking is new to most sales people.
Again, we are most effective when we:
- Establish a realistic target close date based on the customer need to buy.
- Working with the customer doing everything possible to keep it sacred.