Sales Leaders, Did You Make the Right Decision?

We recently came across a VP of Sales, talking about their sales pipeline. During this conversation, he lamented about all the paperwork and reports he is asked to complete. “Sometimes I feel like I’m just re-arranging deck chairs,” he said. “We can stare at the numbers for days, but at some point, we need to act. I’m buried in data … and it’s not helping.”So, how does a sales leader find the right balance between data and decision?

There are several perspectives that seem at odds on the surface. For example:

• Art vs. Science
• Analysis vs. Action
• Standards vs. Creativity
• Relationship-Selling vs. Provocation/Insight-Selling

Data Dilemma

In the quote above, most people would agree that numbers or trends should inform your decisions. But at some point, you can get into an unproductive ‘analysis-paralysis’ loop. Like many things, the different approaches in sales fall along a continuum of more vs less. It’s often an “and”, not an “or.”

Some clients we’ve worked with are more on the art side of sales, while others utilize a much more scientific and evidence-based approach. When it comes to decision-making, more information or data is not necessarily better. And make no mistake, selling is all about making the right go/no-go decisions.

For example, do you continue to pursue a large, resource-intensive sales opportunity? Or do you invest time, money and resources into a key account, strategic partner, or another promising relationship?

One classic adage in sales is to ‘lose early’. This means that from a time and focus standpoint, it’s better to determine if a sales opportunity is worth pursuing early-on in the sales process vs in the later stages when your opportunity cost has skyrocketed. You can’t wait until you have perfect information – you will always be ‘bounded’ in some way.

A Lesson from Horserace Handicappers

In a fascinating study of eight experienced horserace handicappers, more information was not necessarily better, and in many cases, was worse. The only thing more information did was make the handicappers over-confident, not more accurate.

The researchers first asked the handicappers to make race predictions with 5 pieces of information. They then asked the handicappers to make the same predictions with 10, 20, and 40 pieces of information for each horse in the race. As other similar experiments have shown, the handicappers did not achieve greater accuracy with more information. They simply expressed more confidence that they were right.

So, what does this mean for sales?

Staring at more-and-more data is not the path to enlightenment or better decisions. As the handicapper’s study suggests, it’s often better to have a few pieces of the right info vs the detritus of a CRM system gone bad.

Decision-Making with Imperfect Data

The one recurring theme we continue to hear from first-line sales managers is that they’re over-loaded with methodologies, processes, and information. In a world of big data and Google, it seems that the master skill today – for almost any job – is the ability to sift, sort, and synthesize the critical few pieces of info that best predicts an outcome.

This skill is only amplified and intensified given the readily available and visible outcomes that sales produce – pipeline created, wins and losses, revenue produced.

Continuing the conversation with the VP of Sales, we talked a bit more about the information dilemma: “I think senior leadership thinks we should be able to perfectly forecast our sales given all the tools and technologies we have … but it’s just not the case. I spend more time figuring out which reports [and I get too many] are really accurate than I do in figuring out what they really mean.”

“I think quality vs. quantity wins-out in a lot of areas in sales,” we said. “Pursuing the right leads and opportunities and focusing on the right accounts is often more important than the right activities on the wrong accounts. It’s all about making the best decisions we can with imperfect and incomplete information and then adapting and adjusting as more information comes in.”

We often respond negatively when confronted with too many options. In general, buyers don’t want to determine which options matter. They want the seller to make the effort of determining which solution options best match their needs, desires, and objectives.

Contact us to workshop ways to more effectively manage data and decision-making for your sales organization.