Recently, I was working with a large company to help them understand early stage pipeline performance. An overwhelmingly large number of their opportunities were not moving in the early stages of their pipeline – going no place – and the vast majority never made it past the first stage in the pipeline. On the other hand, the opportunities that converted the best through the pipeline and concluded in 90% of the revenue were the ones that came directly from the sales team.
Why were these two things happening simultaneously? No one really knew – we just knew that we had to fix it because:
• They were wasting valuable marketing investments
• Countless hours of sales people’s time were focused on the wrong tasks and
• They were having a hard time forecasting the pipeline – finance was going crazy
When we started digging in to the issue, we started to hear all sorts of rationals as to why this might be happening. Are any of the following statements made by sales and marketing professionals familiar to you
Sales does not follow-up effectively on leads?
Most of the leads that marketing sends to us are not any good.
It’s the sales team's fault that leads don’t turn into revenue.
Why does marketing not consult with sales about where to invest in order to generate the right type of demand?
So who is right? Everyone? No one? The fact is, many companies don’t really know – but what we do know is the result - blame.
Worse, blame further erods pipeline results because it creates a CRISIS of trust and confidence between sales and marketing. The result of all of this continued pipeline leakage – lost revenue. If this cycle of pipeline performance issues and crisis of trust and confidence sounds familiar to you, it's time to do something about it.
Here's where to start - get alignment between sales and marketing! Sales and marketing alignment needs to start with a shared vision and direction – from the CEO down. Without this support, your success will be short-lived and ultimately limited in its impact. Start with agreements on problems. What’s most important and what are we trying to do as a company? Always support your position with quantitative data (crazy idea - leverage the data in your CRM) - anecdotal statements without merit are worthless.
After you have agreements on what Sales and Marketing should achieve together, ask for accountability on deliverables. No accountability means no action – puts you back to the crisis of blame. Align agreements and accountabilities all the way to be bottom of sales and marketing. Team members need to know you are serious and that the message comes from the top. At the top, keep it simple – stay out of the details like processes, performance indicators, compensation plans. Leave those to the implementation team members. Your goal is to get a common direction!
Once you have alignment at the top, it now needs to be fostered in the field. A best practice is to have a Service Level Agreement. Fondly known as the “SLA”. The SLA creates a partnership – it’s a teamwork document. It is a contract that Marketing and Sales develop together that holds each other accountable. Get’s everyone on the same page. It defines key actions like team communication, nurture processes, sales processes, lead scoring and opportunity definitions, key performance indicators and reporting.
If I was to point out one tactic that should not be skipped under any circumstances – it would be the SLA. Would you go in to business with a partner without having a contract? Always have an SLA. Sales and Marketing should review it together every quarter to ensure alignment and KPI performance. Make ongoing changes as necessary to restore or sustain alignment.
If you can accomplish top-down agreements and the creation of an SLA, you have made a giant leap to gaining alignment and setting the stage for improving your pipeline performance.
In my next blog, we will advance this discussion in to the topic of Joint Business Planning.
