Here’s a common sales problem that inflates pipelines, distorts forecasts and consumes precious time and attention from sellers and sales managers.
John is working on a sizable opportunity. It would be a nice win for him and the company.
The prospect is well qualified. And, in fact, supporting John on the opportunity has consumed a hefty amount of the time and attention of sales management, sales engineering, marketing, sales ops and more.
For a while all signs indicated that John had a good chance of winning the order. However, three decision dates have come and gone with no action on the part of the buyer. And no good explanations for the delay.
Now, John’s boss, Paula, wants to know why he believes it’s still a good opportunity. And why the company should continue investing time on the prospect.
John reassures her that it’s still looking promising. In fact, his chief internal advocate at the prospect, Rachel, keeps encouraging him, with vague hints of future action, to stay engaged.
This happens a lot.
Sellers justify sticking with fading sales opportunities because they’ve invested so much time, attention and energy in them. They believe that with just a touch more investment they’ll bring it across the finish line and make the whole thing pay off.
It’s the classic Sunk Cost Trap. Once opportunities have fallen in, they rarely come out.
You hate admitting to yourself, or anyone else, that your investment of time, attention and energy and in an opportunity that you were once convinced was going to close, isn’t going to pay off.
You invoke the Denial Response. “Well, we’ve already invested so much in this deal. If we do just a bit more, I’m confident that we’ll win the order.”
Which rarely happens.
Every pipeline contains these time-wasting sunk-cost opportunities. Someone has to step-up to make an objective, unemotional decision about whether to continue fishing or cut bait.
You can’t rely on the seller to do that. You can’t rely on the front line manager to make this call. It’s just human nature to get sucked into the vortex of optimism that hampers their judgment.
So, how do you escape from this trap?
Here are a few steps that can help you:
First, take the decision about next steps out of the hands of the seller and/or sales manager. They’re stuck. They need help. If they could have made the decision, they already would have.
Second, enlist the help of a manager from another part of your company to help evaluate this opportunity and recommend whether to continue the pursuit. This should be someone who is not directly invested in the outcome. For instance, I liked to bring in a manager from Engineering to help me with cases like these.
Third, bring in an objective 3rd-party from outside your company, such as an executive coach or consultant, to help you reach a dispassionate decision about the next step to take. Spending $1,000 for a 2-3 hours of a consultant’s time can be a very wise investment in this situation. Often you’ll save way more than that by making the decision to move on from a deal.
Sunk-cost opportunities are a big drain on performance and productivity.
If you’ve fallen into that trap, don’t let your ego prevent you from asking for help in making the decision about what to do next.
Bestselling author of Amp Up your Sales and Zero Time Selling, Andy Paul is #8 on LinkedIn’s list of the Top 50 Global Sales Experts to follow. With more than 170,000 followers, Andy is a highly sought-after speaker and sales sage who interviews the world’s foremost sales minds and extraordinarily interesting people to bring you strategies and insights that you can use to generate epic wins and massive value.