Having a big pipeline of “prospects” is typically seen as desirable. The more prospects you put into the pipeline, the more will eventually emerge as clients. At least that’s the theory!
And in principle, the theory is valid. Some of the people you put in the pipeline will become clients. But we always need to ask ourselves two important questions about our pipeline:
- How many of these opportunities do I expect to turn into clients?
- How long will it take for them to emerge from the other end of the pipe?”
THE TIME FACTOR
Taking so long to close-out a non-winning opportunity wouldn’t be so bad if we were investing very little of our time and energy on those dead ends. But that typically isn’t what happens. We typically make major time investments in creating multiple proposals and following up with phone calls, texts, and e-mails.
Why do so many reps cling to opportunities that drag on or become stalled?
Part of the answer is culture. In many organizations, a packed pipeline is considered a sign of success—tangible evidence that the rep is working. The association may not always be accurate, but it exists nonetheless.
Another issue is fear. Some reps hang on to an opportunity too long out of fear that they won’t be able to find another opportunity with which to replace it. They possess a scarcity mentality—the notion that there are not enough good opportunities to go around. They believe that, in order for one person to win, another must lose. If they let go of an opportunity (they reason), someone else will capitalize on it and win, and they will have lost. So they hang on to stalled opportunities just a little longer … and then just a little longer after that.
THE “SELL-BY” DATE
While prospective opportunities don’t come stamped with an expiration date, we need to strive for the next best thing. The idea of “sell-by” dates is one that can be used to help alleviate this back log problem. It can be based on the average length of the selling cycle. If the sale wasn’t closed by that date, you would need compelling evidence that the opportunity deserved to keep its place in the pipeline. Otherwise, it comes out.
With this new approach, agents can spend less time managing their pipeline … and more time identifying new opportunities and moving them forward! As a result, closing numbers will improve.