For those that are starting their own business or have been put into a position to handle sales processes for a company; having a fundamental understanding of how pipelines work is a crucial step in determining the success of a business not only in terms of revenue but also when it comes to creating healthy relationships with customers and prospects.
While it can be scary to think of handling one of the lifelines of a business, pipeline management is not hard of an area to cover. If you have the proper tools and information, you’ll be able to manage and go through each step of the pipeline process with ease.
One important thing to remember when it comes to pipeline management is once you’ve achieved making it reliable, all you’ll need to do left is to keep the steady pace forward while keeping potential threats in check.
The rest is just watching out for further possible improvements to outdo your competition.
In this article, we’ll be talking about pipeline management and why it matters for business strategies. We’ll list down benefits and practical solutions on how you can effectively manage your own pipeline.
How Pipeline Management Matters For Businesses
The concept of sales pipeline management can easily be summarized as “inspecting each part of the sales process.” This is all done for the purpose of being able to check into each part of how a customer goes through your entire funnel.
Think of it as splitting up a complex machine in order to observe, understand, and inspect each individual part. From there, you can easily see which areas you can further improve or fix if there are any problems.
Providing importance to creating optimized and reliable pipeline management can go a long way in improving revenue by making more successful sales as well as consistently meeting customer demands.
Now, let’s go through some main benefits companies can gain from having an effective and reliable pipeline management in their system.
1. Allow Proper Resource Allocation
One of the main benefits of having a sales pipeline is that you’ll be able to know which parts need the most focus and attention when it comes to resource allocation. Using the analogy earlier used on a complex machine (in this case, we’ll imagine a car), it would function the same as buying better headlights to replace broken ones.
The same can be said for pipeline management; sales managers would be able to see which sections of the pipeline customers tend to stay the longest or would have the most trouble with and, in order to fix the issue, would allocate more resources to improve performance.
2. Creating Accurate Forecasts
Pipeline management allows you toproperly create much more accurate forecasts for your business as you are observing each section of the sales funnel. Having a reliable pipeline means you can gauge how successful your existing operations are and, from there, create a forecast on what you can expect in terms of revenue for the foreseeable future.
The best part you can get from having pipeline management integrated into your business is that you can also use these forecasts in other departments such as marketing. At the sametime the data you gather can also be used not only for your business but also in industry-wide research.
3. Monitor Employee Performance
Each sales process has its own team of employees working on making sure that each client or prospect can proceed to the next level as fast as possible, all the while ensuring all their needs are also satisfied and their requirements are met.
With effective pipeline management, you can monitor team performances on how they handle their roles in turning prospects into clients for your business. From here, you can make sure each individual stage in the sales process isn’t holding your business back from being successful in gaining new customers.
7 Best-Practices To Manage Your Sales Pipeline
So, we’ve talked about the benefits of integrating an effective pipeline management scheme into your business. Now, let’s focus more on how you can manage, scale, and optimize your pipeline so that you can get the most out of your efforts.
I. Consider Pipelines As Supply Chains
The first thing that you should do is to imagine the concept of pipelines as a supply chain but in the context of customers. Rather than products going from manufacturing to shipping, you’d be more focused on finding customers than making sure they turn into clients.
Let’s use an example. Say you’re an eCommerce company that is focused on selling high-quality lingerie products to the entire United States. You can imagine the logistics and supply chain management in this operation isn’t easy to start or manage.
Now, to make your job much easier, you’d invest in making sure that the entire process is as streamlined as possible. Investing in supply chain visibility platforms to monitor the entire logistics line, buying in bulk, effective inventory management, and everything else.
The same concept can be said for pipeline management systems. If you can imagine pipelines as supply chains, then you’d be able to easily grasp the strategies you can use to make sure that your sales processes are optimized and effective.
It’s pretty much all the same but with different variables and methods. So, if pipeline management is a hard concept to grasp, just imagine them as supply chains for your products.
II. Set Realistic Goals
Always set realistic goals on your pipelines, especially considering the constantly shifting world of sales. It’d be a waste of resources and can even be a source of conflict between employees and management when unrealistic goals are set for them.
It will only stress your sales teams and create unwanted tension in the work environment. At the same time, it also shows incompetency. This is a circumstance you would want to avoid at all costs, as it can affect how your pipeline runs.
For example, during the pandemic, most businesses and employees had to shift to remote work, and plenty needed time to adjust to the drastic change at such short notice. At one point, statistics show that 71% of all employees in the US worked from home during the pandemic.
If you are a sales team manager and created goals for your time to achieve without putting these factors into consideration, then you’d probably have created unrealistic goals as you haven’t taken important elements of current circumstances into mind.
Make sure that your pipeline ambitions are always realistic. Creating far-fetched goals will only be detrimental and even threaten your existing pipeline and put it into a bad spot when changes are made haphazardly, adding more fuel to the fire.
III. Focus & Highligh Valuable Leads
Most businesses tend to just target every lead they can put their hands on and place them all in one single category when handling them in their sales process. That practice isn’t as ideal as you might think. There are always certain improvements to implement in every system.
With sales pipeline management, you would be able to take a closer look at how your sales process works and, from there, see which leads are the most optimal route to go for.
Handling sales is also proper resource allocation. You wouldn’t want to chase after a lead with so many resources and end up having nothing to show for it.
Make sure you chase proper leads that have a high value so you can get the most revenue in the shortest time and effort required. Stick to your target market as closely as possible; prospects which you know yourself would benefit the most from your service or product.
One of the best ways to determine high-value leads is by implementing lead scoring models in which you score leads and prospects on specific criteria, and from here, you base your prioritization list on who you want to focus on first before the rest.
For example, if you are a company specializing in cryptocurrencies, you wouldn’t want to spend most of your resources on targeting prospects that are just getting started with crypto; you’d also want to try and target those who already have sufficient knowledge in the field.
At the end of the day, prospects have different types of value, and you should accurately measure each lead you have and prioritize appropriately soyou can allocate your sales efforts to the leads that matter the most and have the most potential to bring back value to your business.
Luckily, you won’t have to go through these efforts manually as there are already software suites out there that exist to answer these problems. CRM platforms are great starters to search for.
IV. Monitor Pipeline KPIs
As with everything, you always have to make sure you track your KPIs. It’s one of the crucial aspects that can make your pipeline management as effective as possible. Information and data gathering are pieces you can use to further improve your existing strategies.
You can start by reviewing your KPIs on a weekly basis or even daily if you have the resources to spare so you can actively keep track of what is happening to the overall state of your sales pipeline, as well as how your business is doing in general.
Real-time monitoring of your sales can ensure you are always on top when it comes to seeing negative signs before they even appear to become a problem. The same can be said otherwise to make sure that every sign of good growth is maximized to its fullest potential, be duplicated in the near future, or even be integrated into your business strategy.
Some KPIs for you to track in your sales management pipeline can be the following:
- Amount of deals that you are having in the pipeline
- The average size of deals that you are working with
- The success rate of the deals that you manage to close
- Time spent on a deal before being closed
V. Reviewing & Checking Your Pipeline
Your pipeline isn’t perfect, and the same can be said for how you manage them. It will never be at any time and in any situation. That’s just how it goes when it comes to the world of business. The techniques you are using now might become obsolete in the upcoming months or might have already been obsolete with ROIs becoming less and less convenient.
Staying purposely stagnant in your business strategies can only mean one thing: losing.
You’d want to avoid that as best as possible. Always make sure to review your pipeline process as often as possible to make sure your techniques are always kept on point with the current circumstances.
Reviewing your pipeline process is quite similar to system testing, where you make sure everything is running at its most optimal stages and, at the same time, look for any improvements that can be made.
One tip when reviewing your pipeline is to find the process you believe is holding the other areas back. In other words, find the bottleneck in your sales process, and from there, experiment with possible solutions that you can use to improve.
If you do it right, not only will you be future-proofing your business, but you might even be outdoing the competition in your field.
VI. Standardizing Your Pipeline Processes
It’s easy to fall into the thinking that each individual customer would need an entirely new strategy for you to get the most success in reaching out to them and converting them into a client.
The concept of “personalized marketing” is something that is relatively popular in today’s time.
However, personalization is not always the most optimal process to use for sales.
This problem is even more apparent when you have a large number of sales reps. When you don’t have a standardized process when it comes to handling clients, each one would have its own unique style to address each situation.
Each sales rep might have their own way of handling customer sales tasks, from their mass email marketing outreach campaigns, sales calling, how they handle demos, follow-ups, and the many other processes involved in the sales funnel.
The problem with having no standardized process is that it can be hard to track. You’ll have to go one-on-one with each sales rep on their strategies and how they can improve them even further.
On the other hand, not having a standardized process also raises the chances of making detrimental mistakes in the sales process.
Creating a singular standardized process that is known to be effective for your target market is still a better option to choose because, in reality, your target market still has a lot of common traits you can target safely while maintaining a personalized campaign strategy.
Standardized processes make things a lot easier to track, reduce the chances for a sales rep to make mistakes, and also provide adequate room for improvement transitions to be made.
VII. Diversifying Content Prospecting
In a sales funnel, you’re always trying to grab a large volume of prospects at the start. It’s the first very basic concept of a funnel. But companies often have a big problem in collecting a large number of peopleand the main cause for this problem is the lack of content.
Traditionally, the most common way for businesses to attract clients and customers is through cold-calling with phones and emails. It was the norm for the past decade, and in certain industries, it still is. While investing in these two areas is already a given for most businesses, in today’s time and age, it’s not enough to go for.
The introduction of the internet has created a lot more space for businesses to create content that can attract clients even more. In a pipeline, it’s important to imagine what content can be used for each step. Email marketing and cold-calling remain at the top, but what about in the middle? What about at the end?
There should always be content available that is unique and valuable for prospects at each stage. Always diversify your content when it comes to your pipeline.
Maybe look up how to start a podcast or tutorials on how to start an online webinar. Look through creating YouTube videos on topics your businesses can talk about and have expertise on. Create infographics and reach out to users on social media.
Divide these content areas into appropriate sections on your sales funnel. For example, when you hire content writers to start a blog, you’d label this at the top of the funnel. For the next stage, you would hire researchers to create case studies, and then at the end, you’d pitch for a demo with a live sales rep.
It’s all about the strategy and the diversification in making sure you get the most prospects at the start and keep as many as you can through the sales funnel and finally convert them into clients for your business.
Pipeline management isn’t as complex a task as you might think. It can be an incredibly effective business strategy to implement while being cost-effective with ridiculous returns.
Some businesses heavily rely on a well-functioning pipeline as it can bring much-needed success for revenue growth and increase the number of existing clients.
So, if you want your business to succeed when it comes to beating competitors in the sales game, get your sales pipeline up and running and make sure that it is in its best shape.
Burkhard Berger is the founder of Novum™. Follow Burkhard on his journey from $0 to $100,000 per month. He’s sharing everything he learned in his income reports on Novum™ so you can pick up on his mistakes and wins.