Pipeline management and sales forecasting are challenges in all environments. But, none is more challenging than selling to win government contracts. In this episode, government sales consultant Rick Wimberly identifies some of the biggest pipeline and forecast challenges in government procurement markets. He offers definitive advice on establishing the rules of engagement surrounding pipelines, then a solution for making more accurate forecasts - even when government sales cycles are so blasted long.
In this episode, Government Selling Solutions also announces the availability of customized individual government sales coaching sessions.
There’s hardly a hotter topic in sales management than pipeline management - especially in the government space. I suspect little has caused managers and salespeople to lose their jobs more than poor pipeline management. Honest truth: when it comes to the sales pipeline, there are many ways to muck it up.
Of course, the most obvious way is to not have enough in the pipeline. Duh. But, a large pipeline may not necessarily be a good pipeline…depending on what’s in it.
The pipeline may have bogus opportunities…in other words, so-called opportunities that are not really qualified, but represent more wishful thinking than real opportunities.
The pipeline may not be consistent. That is, different people using different criteria to rate an opportunity.
The pipeline may be unmanaged. No one really knows what’s going on with it.
The pipeline tool may be a pain, or not provide sufficient information…so, people rebel against using it, perhaps giving it lip service but not really using it to advance opportunities.
Or, salespeople are spending too much time on the pipeline tool, which keeps them away from doing the things we talk about in the Myths of Selling Government podcast that really advance government sales opportunities.
I could go on, but you know what I’m talking about.
Add the complexities and long sales cycle of government selling, and the pipeline management challenges become greater.
So, what do you do about it? More in a moment…
I could write a book about pipeline management and forecasting in the government space, but I probably won’t. So, here are some things to consider.
First, establish the rules. Answer questions like, what has to happen before a lead becomes an opportunity? What are your information objectives and how do you document them? At what point do you assign a dollar value to a lead or opportunity? What are the parameters for establishing a value? What do you do about that value changing as the opportunity develops? What stages are you going to use? How do you define them? Do you assign a percentage for an opportunity to close? If so, is that a percentage of the possibility of the opportunity to close, or is that a percentage of the possibility the opportunity will close on the date projected?
And, many more.
It takes time and collaboration to develop the rules. Then, they’ve got to be clearly communicated and followed. Honestly, with most of these rules, I don’t know that it really matters how the rules are defined. What I think is more important is that, indeed, they are defined and communicated…but, not changed, even as personnel turns over.
I think it’s best when the rules are signed off by the most senior levels of management. Senior management needs to understand and endorse the rules. Head off problems down the road by doing this.
I was involved with a company where sales leadership worked hard to get their teams on the same page on pipeline management, and did a pretty dang good job of it. But, the owner had not been part of the process and never really understood what he was being told when he was given reports on pipeline growth. When the sales manager left, senior management blamed him for inflating the pipeline. Seldom does the former pipeline manager get out unscathed when someone else takes over.
Turns out this sales manager was using pipeline growth as a measurement of progress, or lack thereof, not a forecast. He touted the size of the pipeline for each individual contributor, and make sure everyone in the company knew the team’s pipeline number. He worked hard on the accuracy of the pipeline. And, he explained several times to the owner what that pipeline number really meant…but he never got it.
It would have been better had the owner been involved in establishing the pipeline rules early on, and that he clearly understood what the pipeline really meant.
Now I must say that, to me, that pipeline growth factor, if you’d like to call it that, is always important…but critical in the government space - particularly with closing dates and values so hard to project months, maybe years, in advance. It gives you a current measurement about what could close in the future, not necessarily a forecast of what will close. Understand the distinction? If not, reach out to me through the Government Selling Solutions website.
That said, you’re not going to get away without forecasting...and if pipeline growth doesn’t provide the answers to forecast, what does?
Go back to the information objectives we talked about in Season 1, Episode 23: 9 Pieces of Info You Need to Win Government Contracts. My guest was my friend and former colleague Tony Lannom of Axiom Sales Kinectics. He and his company taught me about the 9 information objectives. Here’s a clip from episode 1-23…
<<Tony>>(see YouTube video)
So, when you’re reviewing opportunities, ask yourself if the information objectives have been met for the approaching opportunities? There, you will find what you need in order to properly forecast. Missing some info, then ask. And, if you’re not close on the answers, perhaps this opportunity doesn’t go in your forecast…at least quite yet. But, it remains in your pipeline.
I like to put information objectives in the CRM, at least as a checklist, or better yet a checklist with comment fields. Yes, it’s a tough thing to enforce…but, heck, what isn’t when you’re talking CRM?
We’ll do more episodes on pipeline management and forecasting in government sales in later episodes of Myths of Selling to Government. By the way, we’ve been placing clips from the podcast on YouTube. Look for them there. And, more platforms have picked up on the podcast, which now has downloads in the top 25% of podcast. We thank you for that. Oh, one more thing, Government Selling Solutions is now offering coaching sessions. Go to Gov Selling dot-com for more info.