At the start of every new financial year, the board wants to know:
“Is there enough pipeline to meet our revenue goals for the year?”
Although often, you can interpret it as an instruction instead of a genuine question.
So, salespeople knuckle down to creating opportunities in Salesforce.
Often, this is a desk-based activity. There isn’t necessarily a massive amount of customer-facing deal qualification to support this new pipeline.
However, many successful Sales VPs do something entirely different:
Rather than worrying about pipeline size, they focus on account development plans.
Naturally, it helps if you have an account management framework in Salesforce to underpin that process.
Fortunately, if you want to know how and why to build this framework in Salesforce, then this article is the right place to start.
Sales Team Response To Pipeline Pressure
At the start of the year, the sales team is often under pressure to show a healthy funnel.
Of course, it doesn’t help that likely the budget is bigger than last year.
Many people tell me that’s true even when there is a pandemic raging.
Naturally, there was pressure to close deals in Q4 of the previous year. That means the pipeline has shrunk. These won deals were removed from the funnel.
So, what do salespeople do?
First, they shift deals that didn’t close in the previous period to the new year.
Salespeople do this because removing dormant deals creates even more pressure. It’s far easier to shift the close date.
Pro tip: Sales managers can use pipeline quality metrics to identify deals that no longer have legs. The most important of these is measuring the number of close date month changes.
Second, salespeople take a hard look at their customers and prospects in Salesforce.
Often, they create lots of ‘optimistic’ pipeline deals against these accounts. “Acme will buy something this year, I’m sure. I’ll put in an opportunity with a far-off close date. The deal is bound to close sometime this year’.
If your financial year matches the calendar year, you may even find many of these deals have a close date of December. Or some other internally relevant date.
But likely, this date has nothing much to do with the customer buying process.
Indeed, the prospect might be surprised they figure strongly in the salesperson’s upcoming funnel if they heard about it.
The Downsides of a Rose-Tinted Sales pipeline
But why does it matter that many of the new opportunities are not qualified?
The good news is that the top-down pressure has gone away, and salespeople can now concentrate on what they do best—finding genuine deals to work.
Unfortunately, there are downsides to this approach. These include:
- Poor visibility of the actual pipeline size. You have a rose-tinted view of whether the pipeline really is big enough to meet your sales targets.
- Low-quality information on which to base hiring, marketing, or customer prioritization decisions.
- Distorted metrics on sales performance. For example, how can you rely upon opportunity win rates if many of the deals are, at best, hopeful?
- Distraction from creating value-adding account development plans.
So, what’s the alternative?
The alternative is concentrating on building proactive key account plans for promising customers and prospects.
Account Development Planning in Salesforce
Account plans define how you will drive profitable revenue with specific customers and prospects in the upcoming period.
Each plan represents the strategy for promising customers and prospects. To do this in Salesforce, you need an Account Planning Template.
This means building your own framework; or using the GSP Account Plan app available on the AppExchange.
Straightforward yet powerful Account Plans that drive profitable revenue.
Visit the AppExchange: Key Account Planning by GSP
Either way, here are the four steps your account development framework must support:
- Segment your customers and prospects.
- Build proactive account management plans.
- Create early-stage opportunities that reflect genuine customer demand.
- Review and iterate the account development plan throughout the year.
Let’s start with segmentation.
Customer and prospect segmentation
Many companies segment their customers and prospects in two ways.
First, they do it by the existing segment. This defines your current relationship with the company.
Second, the target segment. The defines how you want the relationship to be at the end of the account plan period.
For example, these are the specific picklist values one of our customers in the professional services sector uses. It’s how they segment their clients and prospects.
- Strategic Customer.
- Steady Supplier.
- Expert For Hire.
- No Relationship.
The first critical step in the account development process is defining each customer’s current and target segment.
Account Development Planning in Salesforce
Next, salespeople think-though the business development ideas for each account.
Specifically, for each customer and prospect, the team thinks about:
- How do I move an account from the current to the target segment? Or,
- How do I make sure the account stays in the current segment, rather than slipping down the ladder?
The account management plans they create describes the path in each case. Where appropriate, it also includes proactive retention or renewal focus.
I recommend you cover the following vital elements in each account plan:
- Goals. These are the high-level outcomes you aim to achieve.
- Objectives. The specific, measurable steps that are needed to achieve the goals.
- SWOT analysis. This includes a description of your company’s strengths and weaknesses in the context of the customer. Avoid elevator pitches. Make the SWOT analysis highly specific to each customer or prospect.
- Internal support. People often forget about this. What help do you need from people and teams in your organization to be successful?
- Next Steps. These are the specific actions you will take over the next 6 to 8 weeks. They kick-start your account management plan.
- KPIs. Tracking revenue performance is critical on each account plan. Roll the value of won and pipeline opportunities up to each account plan to measure target achievement.
Review and iterate
As salespeople start implementing their account development plans, new opportunities will likely emerge.
These opportunities reflect genuine customer buying scenarios based on two-way dialogue.
Of course, the account development plan will need updating as progress continues. I recommend you implement a monthly cadence of account management reviews to adjust and adapt each plan.
Account Management in Your Business
You may not be able to avoid the pipeline building pressure that often comes at the start of each year.
Nevertheless, remember that account development trumps opportunity fabrication every time.
If you want to get started, I recommend reviewing the GSP Key Account Planning app. Here’s where you can find it on the AppExchange.
And of course, don’t hesitate to get in touch to talk about account management in your business.
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