People in sales understand win rates. While most claim they measure and use them to drive execution improvements, this is not what we observe.
Win rates are the number of times you win deals that you have competed in. In a complex B2B sales world, these wins lead to revenue, customers, and confidence in your team. They are the one key metric that is easy to measure in sales cycles for every rep, pre-sales person, and products at the individual unit level. Win rates can be used for numerous roll ups depending upon organization structure, management and functions in your company. Many companies do this well and analyze this Big data with AI and BI tools. They use this metric as an after-action report on what has occurred to give the INSIGHTS to both predict the future and make necessary changes. However, we find that many hot growth SAAS companies are measuring it inaccurately; not using it to implement incremental improvement or innovation; or simply not measuring it at all. We believe that this can be dangerous; getting stuck with the wrong Status Quo as the competitive landscape shifts.
I recently asked Bill, the VP of sales of a $120M SAAS company, if he used this metric. He answered: “of course, doesn’t everyone?” My initial assumption then was that he understood this metric and knew how to use it effectively but was surprised when he told me his company’s win rate overall was 60%. As a healthily skeptical person, I told him that this was excellent, especially when Sirius Decisions research data reveals that best in class B2B enterprise sales companies have a 40% win rate, 30% loss rate, and 30% of the deals going away. How could this company have these awesome statistics? Unfortunately, I discovered they did not include all the total deals that quota sales people put time and effort into. Their numerator was skewed in a way that gave them a false sense of success, not looking deeper for operational improvements. As we helped them review this data more accurately, they discovered some ideas for improvement that caused large positive effects on their performance, revenues, and profit. If Sirius research statistics are accurate, depending on your revenue curve, winning one or two more deals per person can have a tremendous affect on the company’s performance. Knowing the types of deals that you lose or never sign can be essential in collaborative planning discussions to qualify out early or change strategy and tactics.
Another VP of sales I interviewed mentioned sales has changed and asked if there were other activity measures that were more important to measure. At CI2, we believe both. Sales has changed with buyer 2.0 having the ability to get more information and less time to meet with vendors. What is not true is that we are still in a game where winning means something. Although MRR, ARR, and retention metrics are important today, the core KPI of win rates is still one of the most reliable ways to assess and measure performance. When reps know their win rates by year compared to their peers, they will become more curious about what the “best of the best” are doing to achieve higher performance. When product managers know their win rates they will get more curious about what they need to do to make the product more competitive. When sales managers and VPs of sales know their collective and individual win rates, they will be able to assess their sales leaders, teams and sales operations to determine needed changes. Win rates are a way to discuss what’s really happening and engage in a dialogue about how to continuously change to increase performance. It’s a number that everyone should know and be working hard to improve just as it is in all other team sports where millions of dollars are at stake.
At CI2, we believe there needs to be a rebirth of the Win Rate metric. With all the advanced technology tools and data available it should be easier than ever to capture, report and slice in dice in ways to help companies and peoples improve and innovate.
If you are interested in challenging your usage of this metric, click the questionnaire link below. We are here to help you unlock more of your potential.
Connecting with and understanding customers’ business problems and personal implications is more important today than ever. But in this fast-paced world, bombardment of digital messages, priorities shifting on a dime and never enough time, it’s not easy. However, when you don’t fully understand your customer, you are at great risk.
One of CI Squared’s clients, a large software company, discovered the consequences of not taking the time to truly understand their customer. After an initial demo/presentation to this long-standing customer, CI Squared’s client received negative feedback that they were losing. They were given another chance and came back 8 months later with a renewed presentation. The 12 members of the team devoted their time and effort to the new presentation during these 8 months, but they were again rejected by the customer. What happened?
CI Squared’s lost deal analysis revealed that at the crux of why they lost this sale was a lack of understanding. No one on the deal team connected with the operational team or key leaders. They were not able to uncover the real implications of their customer’s business problem and the time frame needed to solve it successfully. Without these insights, they were proposing a perceived solution they thought would fill their customer’s needs. However, from the customer’s viewpoint it did not hit the mark and would take too long. By contrast, the competition had built strong connections with workers and executives, they understood the business problem, motivations of the individuals, and the sense of urgency needed. The customer’s team felt that the competitor “got them” and could deliver a better, timelier solution.
The damages were huge: time, resources, and opportunity cost. They could directly measure that they lost a 3-year, $1.5 million deal in an existing account, $4.5M. How about the investment in people and time or the opportunity cost? How much did it affect their standing with the customer and confidence?
CI Squared believes that better discovery which leads to understanding the customer, both business and personal, is critical in today’s world. How do you help your customer uncover their real problems and deliver insights when they don’t have time? Better human interaction through empathic communication can help you gather the Customer’s whole story and is at the heart of winning today. Customers want to be understood and want to buy from sales teams that give them insights and confidence. But we often rush to talking about our product or service vs staying in the moment and saying, “Tell me more.”
The world has changed and Buyer 2.0 with it. They do not want the same old sales teams who just pitch their products. They have seen that movie before. Your old sales techniques are not enough today to give you the ability to make a strong human connection and listen well enough to get their complete Story with empathy. However, most salespeople have not been exposed to new and innovative ideas and tools. Why not? Some don’t realize the magnitude of this problem on their performance. Some are complacent because change is hard. Some just won’t invest in their people to fill these GAPS. And some think they do it well already which the research debunks.
You can challenge yourself to see how big of a GAP this is individually or organizationally. Benchmark your win rate % against industry averages. Sirius Decisions statistics show that if you count every deal you work on, best in class B2B sales organizations win 40%, lose 30%, and the final 30% just do not buy. We believe that if you calculate this accurately, you will want to do something now. We can help you dramatically shift these ratios.
Or, why aren’t you breaking through the clutter?
You may ask yourself this question after a series of unanswered emails or a promising deal cut short. Here’s why. People don’t have time. What our research shows us is that the amount of incoming content to every person is staggering. “According to Time.com, the average person looks at his/her phone 46 times every day (up from 33 looks per day in 2014). Our new-ish -“always on” culture, complete with the enormous pressure of the expectation of instant responses, effects everything from the quality of our sleep to the depth of our relationships”. (Forbes)
In a fast paced world filled with overwhelming amounts of external and internal stimuli, people are of course:
- Busier than ever before
- Shifting priorities constantly
- Answering too many messages
- Bombarded with content
But if you do not realize this, your message or attempt to get through to a customer will undoubtedly fall flat. The most important mission of sales people and sales methods & techniques is to break through the static. Many current sales methodologies are stuck in the past, not reflecting the new behaviors of Buyer 2.0
Lack of understanding and not connecting personally with customers is a trait that unsuccessful sales people possess in abundance. They hog the conversation with chatter, solutions, features and functions instead of listening. They do not listen to or understand the customer. Humans crave emotional connections and a conversation that uncovers insights. According to this article on Openview, the top sales performers listen 54% of the time and talk 46% of the time. It’s not just that a conversation (not an interrogation) is happening, but the interesting topics that weave in and out of the conversation. What kind of sales conversations are you having? Is it just product, solutions, features and functions? Are you having trouble understanding and making a connection with your harried customers? Are you listening with empathy?
We believe that the world of work is changing dramatically and if you do not update your communication skills to have more insightful business conversations, you will struggle mightily.
Evaluate critically your business conversations to determine what needs to change and invest now to innovate and grow.
B2B Sales is more challenging than ever. Are you following the old herd or leading the new pack?
Customers’ buying habits are changing. The fast pace of technology only accelerates this change with an overwhelming amount of messages and shifting priorities clamoring for people’s undivided attention.
There’s also an intergenerational shift in the workforce as boomers retire and millennials take over which creates a multitude of buyers with different needs. Every one of those individual buyers demands specific valuable insights; something they don’t know, for improved performance from sales teams.
Research from Gartner/CEB states in the shifting B2B executive landscape, alignment of critical stakeholders before any major purchase is highly important. So more people hop on the buying cycle and key people-not as far along in their Buyer’s Journey because of shifting priorities-come in late. Multiple buyers like this in the process result in delays due to repeated activities, frustrating sales teams. Drawn out sales cycles negatively affect everyone involved in your sales campaigns, sales, presales, services and your executives, sapping productivity.
Our research shows the sales teams who struggle the most with the Buyer 2.0 exhibit these “old behaviors”:
- They don’t understand and connect with customers personally: People want human connection as well as business results. 90% of all purchasing decisions are made subconsciously(crowdspring) so having the ability to emotionally connect with people in their harried world is more important than ever
- They don’t understand the customer’s business problems deep enough to provide insight: Because “customers are coming into the sale armed with better product knowledge than ever before. The average customer is more than halfway through the decision-making process by the time they talk with a sales rep, according to some estimates,” (Agile CRM) oftentimes they don’t have the time or energy to provide the finer points of their business problems. But without understanding the business problem it’s hard to offer insights and differentiation, so talk turns to a well-known subject: the product.
- They rush to demo features and functions: It’s not unusual. According to Gartner, 73% Sales reps focus too much on product. We observe that many sales teams rush to demo the features of the product because this is their wheelhouse, but jumping right to knowledge of the product will not cause them to win the deal. If anything, rushing to demo without digging in deep to the problems elongate the sales cycle, confuses the customer, halts progress, and many times causes you to miss the opportunity for understanding. But we all train on, know, and love our product.
Which behaviors are you most guilty of? Are you or sales and marketing guilty of using the same old process and methodology or are you adapting to the new buyer? Quickly adapting to align with shifting customer wants and needs is imperative. How will you leave the herd mentality, set yourself apart, and lead the pack?
This month we are proud to have the President of CI Squared, John Geraci, present his point of view on the state of the corporate training world, drawing on his experience in the United States Army.
Do you feel like you’re flushing training dollars down the toilet? Frustrated and a bit angry, yet knowing training your people is key?
Like most of you, I have been a student, buyer of training and trainer for the better part of 40 years. I believe that we all have great intentions with training, but 80% of our training results in very little behavioral change or real business results—WHY?
While pondering this, my subconscious reminded me of a Story… I was a captain in the United States Army, Airborne/Ranger Infantry. After graduating from the Infantry Officer Advanced course at Fort Benning, I was chosen to participate in a major Army Training Initiative which prepared newly inducted soldiers to be more competent when arriving at their unit. It was an honor to be selected and I would no doubt learn from this experience, but it took almost 40 years to truly appreciate training and how to use it to scale operational performance and gain leverage to train soldiers (people) to execute effectively.
The training struggle for the Army in 1980 was two separate training programs in two locations for basic and advanced trainees. This meant programs were executed by separate cadres and instructors. With typical bureaucracy and overhead, precious time was wasted moving troops from one location to another. They also realized that much of the training was disjointed and had to be repeated. After the 16 week training programs, they were graduating high rates of students per class. But field commanders who received these “newly trained” recruits were left incredulous and frustrated at the unpreparedness of these soldiers and used their own time and resources to bring soldiers up to speed.
General Don Starry, Commanding General of Tradoc, wanted to blow up this model and develop a centralized process that delivered highly trained soldiers to their combat units at a lower cost. This went on to be dubbed “OSUT”- One Station Unit Training.
I was asked to help in the planning to innovate the old into new, so we worked with active infantry units to better understand their needs and problems when trainees arrived. Reimagining how to deliver higher quality, enforceable soldiers while linking the training goals to skills that could then reinforce the principles in the field was a huge step forward. With focus, simplicity, and consistency, less could be more. After 18 months of trial and then implementation in the field, the cost, time, and number of resources, cadres and trainers, was reduced to achieve a better outcome. The graduates left experienced and motivated, battlefield commanders were ecstatic, and the Tradoc Commander and Army Chief of Staff were happy with the cost and overall quality increases. I was proud of the small part I had played and was sure that it would lead me to my dream assignment of working at the Ranger Department. The Army had different ideas, and I became a civilian with the blessing of choosing the nascent Software Industry as my new battlefield.
At this point you may be wondering, what is the point of this Story? Who cares that you trained soldiers and left the Army? How can this Story help me? I may not know everything about your company, but I see a lot of companies making the same mistakes. There are too many disjointed training programs with no focus or reinforcement; programs being thrown over the fence with no active alignment with first line management; exorbitant amounts of time and money spent on classroom with very little practice and reinforcement; training departments working very hard but with no clear goals, alignment or collaboration with field leaders.
Here are 4 lessons to think about as you invest your training dollar to help your employees deliver high performance:
- Start any idea of a training initiative with the WHY and WHAT in mind? What do you need to change or enhance and WHY? Increasing sales productivity to drive revenue from X to Y; increasing customer service conversations to drive satisfaction and more buying from Sat score X to Y and customer revenue from X to Y; aligning people to an organizational change initiative to increase revenue and decrease the cost of a project? If you do not know the business metrics you are trying to change, you will not really be committed and short change the time and effort to make a difference.
- Training is NOT an event. When we trained soldiers to shoot rifles, we not only had 8 hours of classroom instruction, but also had 40 hours of on-range training, both live and dry firing. How many times do you conduct a 1 day or 2-day training and assume that your people can execute these skills post training? How do you reinforce the training? How do you continue to discuss and tell stories about results of training? How do you keep this alive as a core skill for competitive advantage?
- First line managers are key to reinforcement and practice. If the squad leaders were not bought into reinforcing the training and working pieces into their Battle Rhythm, these important skills would not be mastered and would atrophy over time. Are your first line managers bought into the training? Do they know how to reinforce and practice these skills in everyday situations so it fits into the natural cadence of their work? Or are they first time participants from training scheduled by some HR or higher-level leader with no energy or passion to help make these skills habits that lead to real results?
- Training is a campaign, not an event. The OSUT training program we devised all linked together in a way that reinforced the key modules and integrated into the rest of the soldiers training. There was ongoing reinforcement and field practice supervised by competent first line leaders. The skill did not become an effective and efficient behavior until well after the initial training with the necessary focus and emphasis on using this competency to get results. How often do you have this approach?
Let’s learn the value of training and take from the General Don Starry Commander book and design your next training initiative as a campaign to send your troops (employees) into the field with military precision and the right tools to battle and win business.
CI Squared is a leadership and sales training company focused on communication through Storytelling. We are bringing all of these ideas to our training programs in a desire to innovate or “change the training game”. We deliver real behavioral change to achieve your business results.
Learn more about John’s Story:
The Challenger Sale
The Challenger Sale by CEB is based upon research that shows buying has fundamentally changed since 2008, and that Solution Selling is no longer effective in a complex buying world. Executive buyers and users look for different things in the buying cycle, and just diagnosing needs and pitching does not lead to purchases. Also, having great relationships without insight and customer value is not effective. Executives are most interested in buying from an organization, so they want multiple people on the supplier side to be responsive to a project. Most importantly, they want collaborative buy-in from their own people before taking the risk on large projects, both to ensure the right decision and to get commitment from the beginning. However, users also want an individual relationship with someone from the supplier side—someone who is responsive and provides ideas and insight to help them and their companies succeed and perform.
The CEB’s research shows that there are 5 profiles of sales reps executing in complex sales. Two are high performing: The Challengers and The Lone Wolves. Lone Wolves cannot be replicated across an organization, and they often create conflict in a team-based sale. Thus, the characteristics of this type of rep cannot and should not be replicated.
Challengers, on the other hand, do three things differently than the other profiles. These three characteristics allow them to deliver insight and high performance. First, Challengers teach with unique insight into a business. Secondly, they tailor their messages to individuals based upon these insights, and, thirdly, they take control of the sale by focusing on next steps, money conversations, and how to complete the purchase and move to implementation. However, to make this Selling Framework a competitive advantage, it entails broad scale change and organizational adoption by all reps with aid from marketing/sales operations and good coaching sales managers.
The CEB has developed training programs and tools to both initially train and continue to build on these organizational capabilities of Challengers. One item mentioned frequently throughout their book is the use of STORY as a tool to influence buyers—having conversations with buyers by both telling and getting stories. The CEB also maintains that natural Challengers must challenge the prospect to give them new ideas and insights particularly when they disagree. However, they do not teach or train how to do this, and it is perhaps the most critical skill in interacting with prospects. Challenging someone creates conflict, and this is a difficult task and skill to execute effectively—Nice to mention, very hard to do well.
At CI² we absolutely believe that the world is getting more complex and the risk of large purchases is huge. Some sellers have adapted to this and some have not. We believe that the ability/skill of telling compelling stories and gathering insightful stories from your customers is fundamental to detailed execution whenever you are leading, persuading, or trying to influence others. Current brain science based upon tests done with FMRI technology demonstrates why this is so critical for people making decisions or moving to adopt changes. The training we implement at CI² is practical, skill-based learning that will compliment the Challenger Sale principles, as well as most other in-vogue frameworks. Story Gathering is one of the critical skills needed to interact with the new Buyer 2.0, helping him/her and you to get results. Business outcomes our prospects want are: increased revenues, increased sales productivity, increased profitability, increased customer satisfaction, and increased employee satisfaction; all leading to greater shareholder value. Learning gather impactful stories will give you the advantage you need to tell, inspire and motivate others to Action. This critical skill will turbocharge your sales results and lead to higher performance.
John Geraci, CI Squared Co-Founder and President