August 30 by Conga
In a previous post, “Backward Sales Deals: Optimize Your Deal Process,” I proposed a radical shift in the traditional sales paradigm. Rather than perpetually reinventing the wheel by moving linearly through each deal — gathering data, building quotes manually, getting approvals — why not fast track the deals you know are going to be green deals? Green deals are those that cost the least to pursue, but ultimately bring in the most revenue. With fewer approvals to pursue and less red tape to conquer, you can push these deals through faster.
Now, you’re probably thinking, This is a great idea, but I’d need a time machine to know which deals are going to end up being the green deals.
Good news: A version of that time machine already exists… sort of.
Step 1: Pinpoint Your Green Deals
You’ve probably heard of the 80/20 principle: Roughly 80 percent of your sales revenue comes from 20 percent of your clients. But this doesn’t mean that simply isolating the top 20 percent of clients will give you an automatic list of your optimal deals, because big, shiny deals don’t always turn out to be green deals. In fact, sometimes your colossal deals are handicapped by sacrifices made to strike them. For instance, an exit clause that renders a great deal not-so-great if the client decides to opt out at the earliest opportunity.
As a deal moves through the sales process, it can become encumbered by parameters the rep might not have been able to predict at first — contingencies in the manufacturing process, constraints from finance and legal, and/or client stipulations. Using traditional left-to-right quoting methods, a rep can’t possibly predict how these parameters will affect a sale in the long run, even if the quoting is automated.
But sometimes, a sale goes so smoothly that the return on the amount of time and energy expended is surprisingly huge. Having insight into those sales lets you prioritize where to place your reps’ energy and how to structure their commissions. To find those deals, you can’t just look at potential dollars; you must also look at how deals actually play out over time. A deal that appears more modest in the contract stage but segues into a long-term, low-maintenance client ripe for occasional upselling will, in the long run, be most profitable for your company.
By taking advantage of system intelligence with Quote-to-Cash (QTC) tools that sync up with your Configure Price Quote (CPQ) and Contract Management software, you can easily perform complex statistical analysis of both historic and ongoing deals, and conclude which deals tend to turn into green deals. Learning to recognize these deals in the beginning sets you up for the next step: acting on them automatically.
Step 2: Set Up Your System to Act on Green Deals
The ultimate goal of any sales team is to gain complete control over the sales process so there’s no element of surprise. Once you’ve pinpointed your green deals, system-driven intelligence built into your QTC tools fast track green deal automatically, so you don’t have to spend time compiling spreadsheets and constantly communicating across departments to get approvals and keep everyone informed. Within one familiar interface, every person in a company who touches a deal has access to real-time, accurate information that affects that deal.
Even more importantly, system-driven intelligence lets you know which deals are still “in orange” — those that aren’t quite green, but could be with a few easy tweaks. This streamlines the selling process and empowers reps to see how pricing and other variables are fluctuating in real time, keeping reps nimble.
So while we haven’t invented a time machine just yet, we do have a solution that’s akin to literally being able to jump forward in time and assess the actual financial value of each potential sale. By turning the chronology of the quoting process around, sales reps are given end-of-the-line information up front, so they can focus on fast tracking the green deals and maximizing their time for the sake of your revenue.
To find out how you can jump in a time machine and see into the future of your sales results, learn more about Deal Maximizer.