As sales organizations endeavor to escape the constricted economy of the 2009 recession, one of their most significant barriers is stagnant progress in terms of bringing their sales cycle under control. Recent Aberdeen research published for “Inside Sales Enablement: Let Them Drink Coffee!” (Dec. 2009) reveals that not only did under-performing companies see a year-over-year increase in their sales cycle of 12 percent, but even the Best-in-Class, or top 20 percent of performers among over 500 companies surveyed, experienced a slight (1 percent) lengthening of their own bid-to-win time frame.
As top-performing selling teams continue searching for ways to reduce this window, as well as to increase their win/loss “batting average,” the use of selected business processes and enabling technologies such as configure/price/quote (CPQ), contract management, sales playbooks and electronic signature capture tools hold significant promise for better sales team performance in 2010. This Aberdeen benchmark report, scheduled for publication in May 2010, will explore how Best-in-Class companies achieve maximum sales effectiveness through a combination of strategic actions and technologies.
Plenty of Motivation, Lots of Barriers
Regardless of the original source of a sales lead — external telemarketing, inside sales, marketing automation — the typical field or channel sales representative or “closer” has every motivation to move the opportunity through the sales cycle as quickly as possible. The rewards of incentive compensation, quota achievement, professional pride and even promotional opportunities are closely associated with repeated success by any sales professional that consistently meets or beats their number.
Yet the potential barriers to a quick, decisive “win” are many: complex pricing negotiations, detailed product configurations, gaps in communications, insufficient access to internal resources, competitive bids, and even “trigger-shy” buyers. While sales professionals can take advantage of externally provided intelligence (“Sales Intelligence: The Secret to Sales Nirvana,” Jan. 2009) to help them better understand their target audience, the opportunity to shrink the sales cycle, and perhaps increase their win/loss ratio, may also lie with better internal tools focused on the bid-to-win portion of the sales process.
Aberdeen research conducted for “B2B TeleServices: The 2009 Buyer’s Guide” (Nov. 2009) has shown end-user value of deploying external, customer-facing teams to source, nurture and convert the most highly qualified leads on behalf of an internal, B2B-focused field sales organization.
Additional findings in “Inside Sales Enablement: Let Them Drink Coffee!” provide insight into internal teams that can also create effective, top-of-the-funnel filtering methodologies.
Yet how adept are the “closers” at taking the baton-pass to the finish line? Only 46 percent of Best-in-Class companies in the latter report deploy proposal and quote configuration tools in support of the latter stages of sales deal-making. Given the negative trend of sales cycle metrics exhibited by even these top performers, the opportunity to better leverage tools focused on the “bid-to-win” component of the sales funnel bear more in-depth examination.
Benefits and Goals
From the end user’s perspective, the key benefits of deploying bid-to-win enablers include the opportunity to better control the flow and pace of content, intelligence and data between buyer and seller, accomplishing improvements in:
- Reduction of the sales cycle
- Win/loss ratios
- The percentage of sales representatives achieving quota
- Top-line revenue growth
Aberdeen’s hypothesis is that to achieve maximum sales effectiveness, companies must blend a combination of strategic actions and new technologies to:
- Compress sales cycle elements (quote, proposal, contract, sign) into fewer customer interactions
- Drive repeatable behavior among sales reps
- Deploy guided selling methodologies to help sales reps identify the optimal message and timing at each stage of the sales cycle
Aberdeen’s pending research in May 2010, “Automating Bid-To-Win: Shrinking the Sales Cycle and Focusing Closers on Sealing More Deals,” will examine in more depth how top-performing organizations achieve success by controlling the flow and pace of content, intelligence and data between buyer and seller to reduce the sales cycle and improve win/loss ratios.
Peter Ostrow is research director of sales effectiveness at the Aberdeen Group.