Sales Process Vs. Sales Methodology

How consistent is your sales process? Does every sales person understand what they need to do to achieve their sales plan? CEO's often ask us what sales methodology we recommend to improve their process. We’ll hear them say, "We use the Challenger sales model," "We use SPIN selling," or, "We use solution selling." These are all sales methodologies, and that's fine. Not to be disingenuous to sales, but pretty much every sales methodology out there is sort of the same. There are some differences from one to the next, but to keep it very simple, there are key steps that your sales team needs to lead a prospect through the buying process. You have to pique their interest and generate appointments. In Baseline Selling, which is the methodology we use, that process is achieved through asking questions. You start with a conversation or a phone call, ask questions to discover an issue and then schedule an appointment based on that issue.

The next step is going through a discovery process. This is where SPIN selling is strong. The discovery process is about asking questions, leading them through a conversation they haven't had before, uncovering their pain, and uncovering the opportunities for improvement. Some methodologies break this into multiple stages. Regardless, you have to build a case, or help the prospect build a case to want change.

Next, You need to make sure that you understand their decision process, their budget, who else needs to be involved, who else will be impacted by a change, the competitive context, their decision timeline, and their criteria for making a decision. After that, there's a proposal stage, or a closing stage. This might be something like a quote or a proposal that summarizes everything you uncovered during the discovery process, that you present to them and then hopefully close them.

There are some sales methodologies where there's a customer kickoff or client onboarding phase. Whatever methodology you use, it's very important that your sales organization defines a sales process. This should be customized to your business and your market, but look at it from the buyer's perspective. A common mistake we see companies make is they tend look at everything from their own point of view, rather than thinking about it from the buyer's point of view. Think about the different people you serve, the entry points that you want to target as you engage with the market, and what's important to the person in that functional role.

As an example, let's say you're selling technology to CFO's, CIO's and network administrators. All three of those roles are going have very different perspectives on what's important to them, in terms of the problems that you solve. Your customized sales process should consider those differing perspectives. Optimize the process on what's important to each of these individual roles, or whatever roles you're selling to. The sales process is simply a customized, optimized series of steps that your sales team should follow to be more effective.

That's very different than a sales plan. A sales plan uses the sales process, but focuses on what salespeople need to do to be successful. What are their activities and behaviors? If you think of a traditional sales funnel and work your way from the bottom of the funnel up to the top and look at historical data if you have it in your CRM, what kind of critical ratios do you need to hit to have every salesperson hit their goal?

To keep it simple, say every sales person has to produce a million dollars worth of revenue, average sales size is $50 000, so over the course of the year they need to produce 20 new customers at 50K each, and that would get them to a million dollars. If you need 20 wins, how many quotes or proposals do you need? Let's assume you have a 50% conversion ratio, so that's 40 proposals. You think “okay, to get to 40 proposals, how many at the next level up do I need?” Let's assume 50%, and that’s 80, so you need to have 80 proposals where you’ve gone through a thorough discovery process and still qualifying. You might knock half of them out in the qualification process because they don't have the budget, the timing is wrong, or they're loyal to another competitor. To get to 80, how many appointments do you need to make? Just to keep the math simple let's say 160. That means you have to schedule 160 appointments per year.

Then you work backwards and think, “from the very top of the funnel, how many calls, emails, and inbound leads, do I need to generate to get to 160 appointments?” Over a 50 week year, assuming you take a couple weeks for vacation, 160 new appointments sounds like a daunting number, but it's basically a little over three appointments a week. If you look at that, think “okay, if every salesperson could generate 3.2 appointments per week, that would put us in a good spot.”

That process of working from the bottom of the funnel up to the top, and making some assumptions, will help your sales leaders begin to define what activities do they need to do, and measure how they’re doing as they go. Are they ahead or behind? Now you can overlay additional considerations onto a sales plan, such as deal size. Think about diversity of deal size. Make sure your salespeople are having the right kind of conversations so they have some nice, large deals, and some medium deals. That way, they're not spending too much time chasing small deals, unless they can convert them quickly. Another factor that we see impact some of our clients is seasonality. If you're selling in the building materials space, especially in the northern part of the country, there's certainly seasonality. You're going to sell a lot more in the spring and summer than you will in the winter because construction slows down during colder months. In those cases, you have around 30 weeks of selling, where you have to increase those numbers over that period of time. 

So again, think to yourself, “How consistent is your sales process? Does every salesperson understand what they need to do to achieve their sales plan?” If you’re unsatisfied with your answer to that question, or just interested in learning more about sales processes and methodologies, fill out the boxes below to get in contact with us today!