Skills, Strategy and Pipeline Management
In a 2005 study, “Rational Forecasting: The Convergence of Skills, Strategy and Pipeline Management,” Tom Snyder of the Huthwaite Institute points out that inaccurate forecasts, while common, are unnecessary and “a symptom of a more pernicious problem: failing to incorporate the customer’s point of view in the development and implementation of sales strategy.”
According to Snyder, The real problem is a seller-focused sales strategy, not poor forecasting. Too often, says Snyder, sellers think activities such as giving presentations or submitting proposals constitute a sales strategy. While these activities are important to making a sale, they miss customers’ perspectives and thus contribute to poor forecasts. You might, for instance, be checking off all the boxes in the early stages of your pipeline, but your buyers might be in the latter stages of their buying process. Naturally, if this isn’t accounted for, your forecast will be off.
“Effective pipeline tools are representations of two aspects of each sale: the events that the seller has conducted or completed arrayed against the buyer’s incremental commitments to make a buying decision,” says Snyder. “Aligning these two points of view allows sellers to quickly develop an event-oriented sales strategy that focuses on the pipeline milestones that most need addressing.”
A 12- year study on buyer behaviour conducted by Huthwaite found that buyers in complex sales always move through a set of four predictable stages as they make or reaffirm a purchase decision:
- Recognition of needs – when buyers define a problem in terms of what a successful solution will look like
- Evaluation of options – when buyers differentiate between the various suppliers
- Resolution of concerns – when buyers evaluate the consequences of following through on a tentative decision
- Changes over time – when a decision is made, buyers move to this stage when they become comfortable with the status quo
Snyder argues that the development of an effective sales strategy requires sellers to have three skills for this buying cycle:
- the ability to recognize where buyers are in their decision cycle at any particular time,
- the ability to execute the specific skills that create value for customers at each stage, and
- the ability to move buyers both forward and backward in their decision cycle.
Once you attain these skills and develop an effective strategy you are in a position to begin forecasting accurately.
“Accurate forecasting is the natural bedfellow of an effectively executed customer-driven strategy,” Snyder concludes. “With the skills to incorporate the customer’s point of view into the sales strategy, accurate forecasts are the natural byproduct of a good sales pipeline tool.” For more Huthwaite research visit www.huthwaite.com
Click here to find out how SilverStream Solutions can help your organisation align skills, strategy, technology and pipeline management to improve sales forecasting, sales performance and sales revenues. | 
