Opportunity Management
The first component of Sales Cycle Management (SCM) is Opportunity Management. In traditional sales pipelines, salespeople and managers do not spend enough time focusing their efforts on the most promising sales. Instead, effort seems to be misplaced or spread evenly over all possible sales, even the ones that will probably not close. To counteract this, Opportunity Management is the process of tracking the work done before the sale, and adjusting resources and effort accordingly. It may seem at first to be more work than it’s worth, so let’s take a look at the benefits of OM.
First, tracking the work before the sale allows you to focus on the most promising sales. In traditional pipelines, even the “maybe” sales or the ones that may never close seem to stay in the pipeline. By focusing on the most promising, the effort goes full steam into closing and creating a relationship. Along these lines, OM allows sales managers to create a budget based on the expected return and expense on the client. Since you’re tracking the work the salespeople are doing, sales managers can look at that work and specifically coach to it. This specialized coaching will lead to improved results for the entire organization. But how can you go about creating an OM system?
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Account Planning
You’ve spent time in Opportunity Management and Sales Forecasting. You know which clients are the “top ten” probable sales – and you know how many sales you need to make to be profitable. Without account planning, your hard work may go to waste. Account planning is simply the act of applying a precise, project management approach to the individual client – and the sale. What are the benefits of a well-built account plan?
As we’ve briefly discussed, account planning brings your Opportunity Management activities full circle. You’ve got your top possibilities and now you’re going to create a specific plan to make the sale – and keep the client. Account planning allows salespeople and sales managers to closely analyze the sales process – and readjust as necessary. Because you create a detailed plan, sales can be transitioned into a relationship, client-based orientation, versus a hard sell. Here are some steps to take to create your account plan.
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Sales Forecasting
The second component of Sales Cycle Management (SCM) is Sales Forecasting. Many times, salespeople and sales managers do not take a realistic view of how many sales they can undertake during a particular time period. This view makes time spent on Opportunity Management less worthwhile, and makes a traditional sales pipeline stale. What are the benefits of Sales Forecasting?
When you take the time to forecast, you’ll be able to analyze past sales, annual growth, and sales and growth as opposed to industry competitors. In addition to this, forecasting allows you to more closely analyze your price and cost structure, which means you have a better idea of where profit starts to kick in. In other words, a realistic sales forecast can allow you to virtually guarantee profit. When you look at the numbers, sales forecasting is a great way to look at the future from an objective standpoint. But how do you go about creating a sales forecast?
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Sales Performance Analysis
Sales Performance Analysis closes the gap on your entire Sales Cycle. Essentially, performance analysis is a deep look back over certain elements of your sales cycle, from Opportunity Management to Account Planning. Looking at the numbers, ratios, and time frames of your sales cycle provides many useful benefits.
To begin with, analysis allows you to question the entire cycle – and adjust it accordingly. You can determine if sales goals are too high or too low. Analysis gives you an accurate picture of your forecast – is it realistic or does it need to be adjusted? You can also decide if the time and money spent on clients in Opportunity Management was worthwhile – as opposed to the profit gained from the sale. But consider the effects of analysis from the human resources point of view: a thorough analysis gives you hard data that can be used to coach and train the workforce more effectively. Let’s look at how to use sales analysis to close the gap on SCM.
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