Can you give SME readers some background to PSP and how the organisation started?
Practical Sales Processes has been running for almost six years now. It was set up by John Sharples, Russell Haynes and myself. All three of us share a background in ICT sales careers, particularly with one large American company, Electronic Data Systems. (EDS)
At the time, and I have to give credit to the leadership and many colleagues at EDS, we were doing a lot of good things. We were industry leading but we didn’t realise it at the time. It was only when we left the company, we found out how good some of the stuff we were doing actually was. We’d got our win rates up to 80 per cent plus and had built an expectation of winning. Each of us left EDS and, after going our own ways for a short period, we got back together and reflected on how we achieved that sort of performance. We quickly realised how valuable this experience was and set about bringing those processes up to speed, industrializing them going out to the market helping companies improve their sales operations, with the ultimate goal of winning more deals than they lose.
How did the creation of DealGym come about?
I went off to join a small internet company in a frontline sales role after leaving EDS and took this large company experience into a small company environment. I soon realised that they could benefit too from some of the large company sales processes, if re-engineered and tailored in a slightly different fashion to meet the needs of small and medium size businesses. This is when we hit on the idea of creating DealGym. It was borne out of frustration that I had, even going back my EDS days of not knowing if or how you’re going to win, most deals were a leap into the dark. I like to have sound basis for saying that: “This deal’s got more chance than that deal.” If your career and your mortgage depend on it, where are you going to place your bets? You can’t chase everything. If you do, your numbers are going to be horrible because you are not putting enough effort into deals that you really can, and want to win. You’re spreading yourself too thinly.
Following analysis of our Win-Loss review data and based on the experience of our sales careers we recognised that there are a set of attributes that cause you to win or lose any deal. Fairly quickly, John, Russell and I, identified the most commonly encountered 10 to 12 attributes. These attributes range from the very obvious of price and relationships with your buyer, to the value proposition and your reputation and references. At this point we created the first iteration of the DealGym, an Excel spreadsheet with an extensive set of win probability predicting algorithms that ran behind it and then set about testing it with real sales opportunities. We slowly started to add attributes and eventually ended up with a comprehensive set of 20. The full list of attributes can be quite intimidating, and are only used for the largest, most complex sales opportunities.
We started this journey focusing on helping companies increase their win rates. A company we’ve worked with recently had win rates of less than 10 per cent when we arrived. We viewed what it cost them to pursue that other 90 per cent as largely dead money – money that could have been better invested in a smaller number of more promising deals. We have helped them improve their win rates within 12 months to 34.6 per cent and they now have an expectation of winning one in every three deals they chase. We continue to work with them on their journey to get to greater than 50 per cent win rates this year. At the same time as substantially increasing their win rates, their sales budget decreased by 10 per cent as a result of not pursuing deals they are never going to win and more wisely investing their precious resources in the more promising deals identified by DealGym.
You said right at the beginning when you first left EDS that you took your large company experience to an SME. How do SMEs react to bringing in that more corporate approach?
If we sit down in front of SMEs with the 20-attribute DealGym process, they look at us with glazed eyes. It’s too heavy, maybe perceived as over-engineered, and they don’t recognise some the terminology we’re using. Following research into the needs of the SME market, we have made DealGym more accessible and affordable. What our research highlighted was a core of eight attributes that impact every single deal, regardless of complexity, size or value and DealGym Lite was born.
DealGym Lite isn’t rocket science, it’s very intuitive taking you through a three-stage process focusing first on the buyer’s needs and priorities, next on your capabilities against their needs and finally delivering a gap analysis with recommended actions, tips and coaching videos supporting the development of the sales strategy.
In our experience many smaller companies are still run by the original founder, they had a great idea to take to market. Whilst they are experts in their field they are not always the best salespeople and many do not have a sales department, relying instead on engineers or subject matter experts to sell their product or service. We’re finding that DealGym plugs the gaps giving SMEs a sales capability that small companies typically don’t have or helps their limited sales resources punch above their weight.
How important is it that SMEs are honest and transparent about their pipelines and how do you encourage that change in mindset?
Nobody likes being told their pipeline has weaknesses in it, but every salesperson, if they’re honest, knows that to be a fact. From my experience, I had one third of my pipeline that was quite frankly, no more than a list of target companies. A totally speculative list. There was another third that maybe had some obvious potential, but there was just one third that held real, solid opportunities for me. While sales is a numbers game, it’s all about honesty and reputation. The stronger and more credible your pipeline, the better your career prospects, earnings and reputation. It also helps your company make more informed investment decisions with less risk. DealGym is all about strengthening your pipeline, understanding what your numbers are, where does each deal lie? Is it in that solid category or is it in the speculative one? How do you know what to place where? Too often sales people reply on gut feel, instinct or if the buyer returns their calls. I wouldn’t dismiss these, but DealGym will prove you right or wrong and then tell you what you need to do to secure the deal or walk away.
DealGym is about confronting the reality of your pipeline and can, in the early stages, be quite uncomfortable. It doesn’t mean to say that if you’ve got a low win probability because DealGym says so, that you walk away every time. It may be that even if you’re going to lose a deal, there’s something to be learned from it. It might be an investment in that relationship for next time round, it might be a new industry sector that you want to get some experience pitching to. No bad thing. So long as you can justify the reason to spend valuable resources and money pursuing the deal that’s got a low win probability, that’s fine, but I wouldn’t do it too often.
How do SMEs get started with DealGym?
They can simply visit our website, contact us and we’ll issue DealGym user ID’s by email. The application is cloud-based, so there’s nothing to download, no special software or training needed, users just follow the on-line tutorials and are good to go. You learn as you use the tool, it’s really not complex at all.
Does DealGym work alongside a CRM system or is that inbuilt?
Currently it works alongside a CRM system, however we are considering developing links to some of the more popular CRM systems, but that doesn’t exist today. The DealGym action plan can be imported into most CRM systems.
How much time does it take on average to input all the data and to get the ‘result’ back from the product?
If I’m honest. It depends on how you use it. If you’re a single user and you’re just using it on your smart phone or tablet, you’re talking about 15 to20 minutes. If you’re doing it with multiple colleagues and you’re focusing on the detail of what’s important, what evidence do you have, that can take time, maybe a couple of hours for a very complex deal. It’s your choice how detailed you want to get,
The enterprise version (20 attributes) is typically a two-hour workshop but DealGym Lite is usually done in 30 or 40 minutes.
Why is it important to make sure that you can have this time to reflect and to analyse your deals?
The more time you put into something you really care about, the better the result. There is no shortcut for that early stage, really thinking about not only can I win this deal, but how can I win this deal. If you start by chasing everything, regardless of whether you have an effective sales strategy, you waste much more time adjusting or changing course, even worse you may end up walking away from the deal losing all of the time invested. As is the case in most other industries, the more time you spend planning and designing the better the product will be, sales is no different. DealGym will save you time in the long run.