This post was written (very rapidly) as a response to a question posted on LinkedIn by John Smibert:
What causes a sales pipeline to become clogged? What should we do to get it flowing again?
With those questions in mind, and my Lean Thinking hat firmly on my head, here are some areas for consideration:
Capacity/throughput:
Sales is often part of a longer value stream including marketing and business development. If too much is being pushed into the pipeline, and your sales team doesn’t have the capacity to process it, it’s going to get clogged with work in progress (WIP). Too much WIP means you’re trying to spin too many plates, and the important ones won’t get the right focus. This results in waste of effort and opportunities not progressing. Solution: 1) adjust capacity of marketing, business development and sales to optimize flow; 2) pull into the pipe don’t push into it; 3) have a really good approach to qualification to guide what you pull in.
Knowing what’s really in your pipe:
Often, especially with some technology, it’s difficult to keep track of all the things you’re working on, exactly where it sits within your process/pipeline, and where it might be getting stuck. Solution: visualize your sales process and opportunity pipeline, so you know what’s coming, what’s in process, what happens next, and where things are piling up. Human beings tend to process information much more quickly and effectively when it’s visual.
Understanding/following the process:
Many sales processes aren’t clearly defined – if you’re lucky, you’ll have stage names, nothing else. This does not provide clear guidance on opportunity status, opportunity progression, or pipeline governance. Solution: provide clear stage definitions for stages in your process (in lean these are known as “lane policies”). Even better, make sure these are based on outcomes, not tasks.
Qualification or lack thereof:
If you don’t qualify well, your pipeline will be full of stuffing that doesn’t deserve your attention, which will be a distraction, and result in waste as opportunities go nowhere. Solution: qualify well before anything enters the pipe, but don’t stop there – qualify continuously. Despite early and thorough qualification things will change. Is your customer still engaging with you? Has your customer prioritized you as much as you’ve prioritized them? Are they seeing value from their interactions with you? Are there new stakeholders in town, and are they all in agreement? Ensure your sales process supports continuous qualification and follow it.
Too much variability:
Opportunities come in all shapes and sizes, and don’t we just love the really big ones! Great, but really big opportunities consume time, energy and resources, which can result in serious reduction in flow (of deals closing) or even a complete standstill. Solution: 1) qualify really well if you’re going to seriously invest in a very large opportunity; 2) adopt a team approach with division of responsibilities for small, medium and large deals, ensuring that you avoid conflict and tension between team members by having a compensation plan that rewards team success; 3) consider breaking larger deals down into smaller deals (not everyone will like this) that can be won more quickly (thus proving value earlier), or, at the very least, breaking that larger deal down into achievable outcomes that will enable forward progression (or continuing flow).
Remember: sometimes, in sales, less can be more!
