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Sales Pipeline Management

“Sales pipeline” is one of those terms that gets thrown around a lot. If you are in sales, you will be constantly hearing about “filling your sales pipeline with hot prospects” and “pumping up your pipeline” to meet and beat your company’s revenue goals. You have probably spent some time thinking about how to build a strong sales pipeline, or, if you already have one, how to improve sales pipeline performance.

CSO Insights describes the sales pipeline as mission critical to business and notes that “Sales executives are under more pressure than ever to master the sales pipeline to understand the heart of their business.”

Vantage Point tells us that over 70% of sales managers conduct sales pipeline review meetings with their reps three or more times every month to review sales pipeline metrics and sales productivity metrics. But the same article cites a survey that says 63% of respondents say that they don’t really have the tools for sales pipeline management best practices and their companies do an inadequate job of managing their sales pipelines.

And you don’t have to look very hard to find an in-depth sales pipeline example replete with commentary on how sales and marketing teams are more data-driven and digitally connected than ever before because of new platforms for managing and analyzing the sales pipeline.

There’s a lot of buzz around sales pipeline management, and there’s no doubt that mastering the analysis of the sales pipeline is critical to your success. But what is pipeline management in sales? For that matter, what is a sales pipeline?

Your sales pipeline is a snapshot of where your prospects are in your sales process. Those visual representations of your sales pipeline power sales pipeline management that boost your bottom line and ensures meeting your sales goals. 

But let’s back up for a moment. What’s a sales process?

When your company has a formally defined sales process, salespeople don’t have to guess where a particular deal stands or what they need to be doing to manage it. Your formally defined sales process keeps everybody rowing in the same direction — and in the same boat — instead of using generic sales analysis to get generic sales projections. Sales pipeline management keeps prospects from falling between the cracks.

Companies need at least (1) a list of prospects, (2) their sales process, (3) and their revenue targets as data to input into their sales pipeline for sales pipeline analysis. But how does that work, exactly?

Chances are that your sales pipeline stages will include:

  • Prospecting, finding the potential buyers you can convert to customers.
  • Qualifying, making sure the prospect is a good fit with your company after research or after your sales rep has made initial contact.
  • Contacting, either making a cold call or following up with prospects after an initial meeting.
  • Building relationships, getting to know the prospects’ unique issues and potential to your company.
  • Closing, finalizing the relationship, and sealing the deal.

A simple sales pipeline analysis definition may just collect names and contact points and subjective impressions from front-line sales staff on how likely a prospect is to become a customer. But the more precisely you have formalized your sales process, the more objectively and quantitatively you can project conversion rates and impact of sales effort on future revenues based on historical experience.

The Importance of Pipeline Analysis

Why is pipeline management important?

Harvard Business Review states that companies that give definition to their sales process have 18% higher revenues than companies that don’t. And companies that (1) define their sales pipeline, (2) train their managers in sales pipeline management, and (3) spend at least 3 hours a month in sales pipeline analysis grow 9% faster and earn 28% more than companies that don’t.

The researchers at Harvard say that the importance of sales pipeline analysis metrics for opportunity pipeline analysis isn’t lost on corporate managers. Their study revealed that 61% of senior executives admitted that sales managers weren’t adequately trained in sales pipeline management techniques and strategies, which means that sales managers don’t usually have effective pipeline management tools.

But not just any kind of sales management analysis will do. Sales managers need objective, quantitative data to tackle specific sales pipeline management challenges.

Opportunity pipeline analysis helps sales managers find the right size for their sales funnels. It turns inspection sessions into coaching sessions. It gives management the skills to have a significant impact on sales performance.

There are no secrets to sales performance when you have a clear process and clear data in a form everyone can understand. Once you integrate best practices into your sales force, you can expect to hit your quotas, nail your forecasts, and see your sales representatives succeed beyond all prior expectations. 

Creative Ways to Build your Pipeline

If you have never used any kind of sales management analysis before, there will be a learning curve to climb as you build your sales pipeline. Before you get into creative ways to build pipeline analytics and in-depth consideration of sales pipeline best practices and consult all the gurus on how to build a sales pipeline, you need to take time out just to consider the kinds of information you need for informed management decisions.

Upfront, before you even have a pipeline, you will at least have a list of prospects, people, and companies you think would like to buy your products. If you have a lot of prospects, you need something to keep track of them and to keep track of your sales force’s interactions with them.

The next thing you will need to do is to set up the stages of your sales process. Don’t just give your sales reps a monthly, quarterly, or annual number they have to achieve. Sales reps can experience naked sales goals without process or feedback as a kind of punishment.

Give them the guidance they need to build up to their sales goal. Break down each sale into the daily activities each rep needs to perform in order to close it.

By now, you realize that your sales pipeline is measuring your annual bottom line. It’s breaking down each component of making a sale into the daily, weekly, monthly, quarterly, and annual activities for which sales reps and sales management are responsible. By breaking down making sales into manageable steps in your sales pipeline, you focus attention, prevent mistakes, and make sure no prospect is left unserved.

Once you have reached this point, you will refine your stages as you go along. You may notice that certain kinds of interactions with prospects come up more often. You may want to gather data about those interactions and turn them into a step in your pipeline.

When you have clearly planned and defined the stages of your sales process, you will have the fundamental reporting areas you need for your sales pipeline. You will have to keep your pipeline data up to date, but if you do, you will be on your way to increasing sales revenues for your company.

The easiest way to accomplish the definitions of each of the stages of your sales pipeline is by conceptualizing stages of your pipeline like a to-do list. Each stage in your sales pipeline corresponds to an activity or activities your team must complete. Once an activity is completed, your team will move a deal to the next stage. It may take a while for your team to get the hang of it, but after a while, the pipeline will be an invaluable tool for them because it shows them what they’ve done, what they need to do, and where in the pipeline each deal is.

Pipeline Trackers

On one level, the stages of your pipeline are a kind of to-do list. Every stage corresponds to a task your sales team must complete. Once a stage is complete, your sales team moves on to the next. Your sales team will know what they have already done, what they need to do next, and where in the pipeline they can find every deal.

If your company is managing, say, 10 deals at a time, it’s OK for your sales pipeline to be a sales lead tracking Excel template or maybe a spreadsheet from Google tools. When you are dealing with small numbers of simple deals, nobody needs to go back to business school for a refresher course on how to measure pipeline growth. Limiting your investment in best sales pipeline management practices to an Excel sales tracking template may be OK.

But if your organization manages hundreds, thousands, or tens of thousands of customer engagement opportunities and the question facing you is how to measure pipeline growth analytically, using all the data your company collects, then a sales pipeline tracker from Google or Microsoft isn’t going to work for you.

And even if you keep your sales pipeline extremely manageable, you probably should stay away from free online tools because of problems with hackers, overwriting by multiple users, and issues with infrequent software updates.

Canopy

At Canopy, we help companies control sales pipeline management in sales. What is pipeline management in sales? We see it in four major functions:

  • Signals. Every sales process starts with finding prospects. You might have a lead generation team. You might mine social media or professional contacts. You might buy a prospects list. Canopy helps you go beyond rehashing lists of names to monitoring critical opportunities for reaching out to create a customer.
  • Forecasts. Every company needs to know the difference between a hot prospect and a cold one. Canopy helps your sales management forecast from the 20,000-foot level. We provide AI & ML driven statistical models that identify actionable variations in the sales process with individualized process reporting and snapshots of your sales pipeline as it relates to your company as a whole.
  • Coaching. Motivating frontline sales managers isn’t all about rah-rah in hour-long meetings three or four times a month. It’s all about key performance indicators that drive real, quantifiable results that feed your bottom line. Our system allows for 1 to 1 note-taking.
  • Analysis. Our platform gives your team the tools it needs to take a snapshot of your revenues at any point in time. Our platform also does the statistical analysis you need to identify historical trends.

Your sales pipeline analysis definition is sure to include these four functions. Of course, your sales process isn’t all about what you can quantify. Your front-line sales staff will have the soft skills to build the relationships that turn prospects into customers. Our quantitative analysis of your sales pipeline just makes sure that your sales team is in sync with your sales goals, and your sales department is in sync with the goals of your company at large.

The constantly shifting environment of business requires more attention than ever before to stay up to date to empower teams to execute at a high level. Canopy will is the pipeline analysis tool that provides all the information a sophisticated pipeline management system needs for companies that operate at scale. Canopy pipeline management tools serve sales managers at companies big and small who know the value of predictive tools to meet revenue goals.

Looking for more information? Check out some of our other pages!

Sales Performance Management Software

AI for Sales

Sales Activity Tracker 

Demand Forecasting Methods

Sales Team Productivity Software

Business Reporting Platforms

Marginal Revenue Productivity

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