If you’re going to lose, it’s always better to lose early – and if a deal is going nowhere, it’s always better to realise this sooner, rather than later.
These are both examples of what I’ve come to recognise as “the curse of the slow no”. In the first instance, the customer took their time (and why wouldn’t they?) to let you know you were never likely to win the business. In the second, you probably took too long to realise that whilst there may have appeared to be interest on the part of the prospect, there certainly wasn’t enough urgency, or a compelling event.
The “slow no” isn’t just very frustrating and demoralising – it usually represents a significant of wasted effort and energy. Worse, the time and resources that were thrown into trying to win the un-winnable deal could almost certainly have been better spent pursuing a better qualified opportunity.
So how can vendors throw off the curse of the slow no? The answer often lies at the very beginning of the engagement with the prospect. We’ve found that opportunity scoring can help determine – right from the start of the process – not only how good a fit the prospect is for you, but how good a fit you are for them.
It’s almost always better to continue searching for a prospect with a better score than to run with an opportunity that doesn’t tick enough boxes simply because you don’t have any other alternative.
How can vendors know when a competitor has their grubby fingerprints all over a deal? One of the key tests is the prospects willingness to have you help them shape their objectives, and the criteria by which they will judge potential solutions – and receiving an RFP out of the blue is almost always a sign that someone else has seized the initiative. If the prospect is closed to any suggestions, it’s usually a good sign that you should up and walk away.
Finally, the challenge of identifying deals that are never likely to go anywhere can be met by probing for the “cost of inaction”. Two questions have proved particularly invaluable – “what would be the impact of not solving this problem?” and “what has prevented you from solving the problem before?”.
I’ve found that these approaches have helped client after client qualify better, earlier in the sales process – and successfully avoid the “curse of the slow no”. Of course, they depend on close alignment between the sales and marketing organisations – but isn’t this something we should all be striving for anyway?
Risk is what you are describing–for both the seller and buyer. A big challenge is how a salesperson can identify “inevitable no’s” before all parties invest significant time and resources. Salespeople who work for large, well-known technology companies face particular risk. “We really want to award the business to [company y], but the boss said we need a quote from [company X] so ‘the committee’ knows we did our due diligence.”
There are lots of other risks that companies face, including solution-fit risk, access-to-decision-maker risk, budget risk, and motivation risk (as you point out).
The job of early qualification is to find out the highest risk conditions. Then the sales team must decide what to do next. Do you discard the lead and move on to the next? Do you try to change the negative condition? Do you move the client into a lower-ranked prospect quality tier so that fewer resources are applied until the risk is reduced?
There are no “one-size-fits-all” answers. The right path depends in part on the organization’s risk appetite.
I’m interested in your thoughts about what value a sales organization might glean from working with a prospect that has a lower qualification score. Could it provide some insight about what opportunities are being missed in the qualification process? Could a company find out what capabilities might be desirable and enable marketing to expand the boundary of a target market? Is it valuable for organizations to create ways to capture and share qualification information so engineers, product managers, and salespeople can look beyond the quarterly horizon for the next opportunity?
You raise a great point, and one that I’ve come across in a number of situations. One of the primary objectives of scoring is to establish the degree of alignment between the prospect’s challenges and constraints and the vendor’s capabilities and credentials.
It should not be regarded as a simply mechanical process: rather, opportunity scoring should inform a review between sales person and sales manager as to whether the opportunity looks both (1) attractive and (2) closable.
The attractiveness of opportunities isn’t just a matter of finding a perfect fit for current capabilities; it’s a measure of the potential strategic value of winning the deal. That – as you suggest – might be measured in terms of opening a path to a new adjacency, whether it be different products to the same customer or (more likely) the same or similar product offerings to a new customer segment.
I’ve found that a number of clients have consciously pursued “less than perfect” opportunities because they have concluded that winning the deal will help them expand their addressable market.
This was one of the reasons I always used to invite the CTO and head of product marketing into sales pipeline reviews – because these reviews can provide tremendous, real-market driven insights into where development or services resources might be wisely invested.
Regards
Bob Apollo | Inflexion-Point
Building Scalable Businesses
If there is a valid opportunity, but the timing is not quite right, the obvious answer is to invest in lead nurturing systems and processes (with the party’s permission, of course). As CustomerThink master Dick Lee has stated in the past, there’s more than enough ROI in lead nurturing activities to justify the cost.
If the opportunity really isn’t there, then as Bob states, it’s time to analyze the driving force behind the opportunity on the table.
Frankly speaking, is any deal every really off the table? No, it’s just a question of whether or not one of the two parties is willing to sacrifice the resources, cost, labor, or whatever else is required to get the deal done.
-Steve
InsideSales.com
Steve makes an important point. Vendors need to be able to distinguish between “no” and “not yet”. If it’s a current sales cycle the things to consider are: is there a compelling issue* the prospect needs to solve, have you a superior ability to help the prospect solve it, and will circumstances allow you to solve it? (by the last remark, I mean do the politics of deal give you a chance of winning).
For as long as there is a compelling issue that you can help the prospect solve, then deal is never “off the table”, and the opportunity needs to be nurtured until the time is right. Most times, the field sales force are simply not set up to nurture longer-term opportunities, so a dedicated lead nurturing programme is usually essential to avoid all that latent value simply slipping away.
The opportunity has the best chance of progressing when the “cost of inaction” has reached the point where it is perceived by the buyer to be more than the effort required to find and implement a solution, but that’s best addressed in a separate article.
Selling where there isn’t a compelling issue is best avoided, and Craig Elias has contributed a raft of great ideas about how the necessary “Trigger Events” can be found or created, both here on CustomerThink and at http://www.shiftselling.com.
Regards
Bob Apollo | Inflexion-Point
Building Scalable Businesses
*Something that now or in the future will cause the prospect to do something, and is unlikely to go away of its own accord.
Wayne’s Gretzky’s famed quote is apropos here:
“A good hockey player plays where the puck is. A great hockey player plays where the puck is going to be.”
It’s not a perfect analogy for sales, because there’s no crisp line telling us where the Nurturing Process formally ends and the sales process begins. If there’s no immediate need, salespeople must look at forces that present future opportunities, and to place bets on those forces. (A good model for conceptualizing forces is called “Porter’s Five-forces” http://en.wikipedia.org/wiki/Porter_5_forces_analysis)
For an example, look at Boeing vs. Airbus and their next generation of passenger aircraft. Both companies have the same market data, but they have placed bets on hugely different outcomes. Boeing on route versatility and improving the flying experience with the 787 Dreamliner, and Airbus on moving large numbers of people between hub cities for the A 380.
Granted, most companies don’t have the same long development cycles required for large commercial aircraft, but they are subject to the similar forces. Unfortunately, their managers don’t connect sales strategies to the developments likely to impact the sales. Their singular strategy–if you can call it that–is to uncover immediate need. But doing so creates assumptions of static conditions, which often cause opportunities to fail.
I’ve heard the Wayne Gretzky analogy before, and it’s certainly inspiring, particularly to any of us who turned up to a fight only to find an ice hockey match breaking out. But one of the problems is that there aren’t many Gretzky’s around in any one generation – just as true sales naturals tend to be few and far between. So one of the challenges for organisations is how to get great performance from a team composed largely of good players.
I believe that organisations need to anticipate upcoming waves in the market, but it’s unrealistic for most sales people to be able to do more than seek out the trigger events that drive current prospect behaviour.
One of the techniques I’ve found that can generate the required insight is to conduct “process of buying” surveys with companies that started a buying cycle, but chose to do nothing at the end of the day.
You can learn a lot about where your product or service might evolve to by determining what unsatisfied needs prevented that buyer from having the confidence or desire to buy today.
Bob Apollo | Inflexion-Point
Building Scalable Businesses