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Sales transformation - Best Practice Funnel Creation

NSN sales transformation project
Best Practice Funnel Creation
1
For internal use
©2013 Nokia Solutions and Networks. All rights reserved.
Best Practice Sales Funnel Creation
 In order to foster an innovative environment we propose to introduce on a
half-yearly basis some industry best practices based on research from:
 Miller Heiman
 Salesforce.com
 Salesmanagement.org (SMA)
 Practice or Process - Lead Qualification & Lead Scoring
 Measure or KPI – Sales Cycle Times/ Velocity
2
For internal use
©2013 Nokia Solutions and Networks. All rights reserved.
Practice or Process:
Lead Qualification & Lead Scoring
 Why do it?
 You can track the customers level of interest in your solution (engagement) in addition
to your interest in them.
 By combining both factors you can truly send qualified leads to sales.
 This will lead to prioritizing the portfolio of leads and a better qualified pipeline.
 Pro’s
 CT’s/ Sales can focus on the high quality leads and not waste time on prospects that
aren’t a good fit or are not ready
 Opportunities will be prioritised in which resources should be deployed – important for
the identified growth cases
 Reduced funnel leakage (withdrawn, cancelled, lost)
 Con’s
 Lead scoring is not needed if the sales team does not have enough leads
 Lead scoring will not work if we don’t have the right or any lead intelligence
3
For internal use
©2013 Nokia Solutions and Networks. All rights reserved.
Concept 1: Enhanced Lead Qualification
 Lead Qualification and Lead Scoring:
 As part of the Gate 3 Bid / No Bid decision the Sub-Region Sales Development Head will
formalize the process in a review. Attendees would include:
o Sub-Region Approval Body: SD Head, GS Solutions Head, MBB Solutions Head
o Case Owner(s)
o CT Head(s)
 Topics to be covered include:
o
o
o
o
o
o
o
o
Case Summary
Bid/No Bid Assessment
Lead Score
Case Value
Win Probability
Business Line Planning
Team Setup
Gate 4/5/6 Planning
Enhanced Bid/No Bid template:
4
For internal use
©2013 Nokia Solutions and Networks. All rights reserved.
Concept 1: Enhanced Lead Qualification
 Lead Scoring Example 1: LTE entry
5
For internal use
©2013 Nokia Solutions and Networks. All rights reserved.
Concept 1: Enhanced Lead Qualification
 Lead Scoring Example 2: Expansion
Case is not exactly ideal to pursue due to small size of historical revenue from
customer, but they do have an allocated budget for a solution and it may be a
high GP/OP business case. Recommendation would be to use CSSC rather than
tie up APAC resources.
6
For internal use
©2013 Nokia Solutions and Networks. All rights reserved.
Measure or KPI:
Sales Cycle Times/ Velocity
 Why do it?
 NSN doesn’t know the actual length of sales cycle for CT’s or of different sized cases
 Taking analysis to the next level – understanding the different levers to drive sales
 Implement the leading indicator to measure sales cycle times/ velocity of cases
 Pro’s
 Measure the days in each stage of the Sales Cycle
 Benchmarking in order to start accurate forecasting
 Measure the effort or efficiency of the sales organisation
 Con’s
 May have to make some assumptions with current database, as historical gate
information may be incomplete.
 If not implemented, only fallback is to rely on OPEX i.e. The measure of an organization’s
sales effectiveness translating from revenue generated for a fixed or variable cost.
7
For internal use
©2013 Nokia Solutions and Networks. All rights reserved.
Concept 2: Use of Leading Indicators
 Sales Cycle Length (Velocity):
 Sales velocity measures the time taken for opportunities to flow from one stage
to the next or from the current stage to the end, and it is a critical predictor of
sales success.
 Research has shown that, on average, it takes 150% longer to lose a deal than
it does to win one. That’s in part because that deals that get stuck in a stage for
an unnaturally long period of time tend never to close at all.
 Measure - Average # of days in each opportunity stage
o By tracking the average number of days in each opportunity stage, sales managers can
get a better idea of which pipeline opportunities are likely to close, thus allowing them
to forecast more accurately (leading to benchmarking)
o This will allow us to measure the days in each stage of the Sales Cycle, the sales cycle
of certain sized cases or the Sales Cycle of CT’s.
8
For internal use
©2013 Nokia Solutions and Networks. All rights reserved.
Concept 2: Leading Indicators
Example Output: Average # of days in each opportunity stage
Gate Approved in period
P7-13
P8-13
P9-13
P10-13
P11-13
P12-13
Avg
Days
Total
Value
(m€)
Avg
Days
Total
Value
(m€)
Avg
Days
Total
Value
(m€)
Avg
Days
Total
Value
(m€)
Avg
Days
G3
54
42
303
43
306
55
225
62
314
37
47
G4
316
70
22
69
162
63
358
71
274
133
75
G5
384
77
61
60
79
81
25
63
196
49
69
219
191
Sales
Cycle
189
172
199
196
Total
Value
(m€)
Avg
Days
Avg
Days
Total
Value
(m€)
Lost*
5
190
7
210
9
170
7
160
5
200
186
Cancelled*
6
95
8
105
10
85
8
75
6
100
92
*Dummy Data
9
For internal use
©2013 Nokia Solutions and Networks. All rights reserved.
BACKUP:
Research on Sales Funnel best
practices
10
For internal use
©2013 Nokia Solutions and Networks. All rights reserved.
Renewed approach to implementing Funnel Management Best Practices
Create
Manage
Measure
Follow a standardized
process for qualification
Align to support the
customer buying process
Using Leading
Indicators
 Strategy/ Account
planning best
practices
 Lead Scoring
 Lead Qualification
ü
11
For internal use


 Redefine the
funnel around the
buying decision
process - Global
 Sales Funnel
Health
Benchmarking of
Lagging & Leading
Indicators:
Pipeline to Target
Ratio
 # Qualified Leads
 Average # days in
each stage (Sales
Cycle Length/ Velocity)
 Stage-to-Stage
Conversion Ratios
 Hit Rate
©2013 Nokia Solutions and Networks. All rights reserved.


Create
Create: From Strategy to Opportunity
• Region Pipeline
3:1
Leads
2
3
Prospects
Deals
1
X
* Pipeline Multipliers: The Math Just Does Not Work
12
For internal use
 To avoid the sales rollercoaster, prioritize 1st
time spent on closing/ negotiating deals, 2nd
qualifying leads, 3rd tendering/ assessing
customers stakeholders.
 Benchmarking: Companies that manage a
pipeline of 3X or less had a 32% better
conversion/close rate*. Where:
X = ( C x C) x V
Capacity
Conversion
Velocity
: # of active opportunities
: % of active opportunities that close
: Sales Cycle Length
 Therefore, there needs to be a greater focus
on qualifying leads as they enter the funnel
 Increasing the number/value of the pipeline
opportunities does not have a linear effect on
decisions won.
©2013 Nokia Solutions and Networks. All rights reserved.
Sales and marketing best practices
SELF-ASSESSMENT
 Assessment for SD Heads to take:
http://www.inflexion-point.com/self-assessment-2013/
This short self-assessment addresses three key areas that are critical to the
success of any B2B sales and marketing organisation: focus, processes and
programmes. The questions draw upon the best practices being implemented by
many of today's most successful growth-stage B2B-focused companies.
13
For internal use
©2013 Nokia Solutions and Networks. All rights reserved.
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