The biggest risk to people who carry business development responsibilities is that they’ll waste their time on prospects who will not close. Whether you sell services to businesses or to individuals, your ability to accurately predict a close impacts so many things.
To earn the respect, trust and confidence of the people around you, you need a solid pipeline of deals and a predictive model that works. You need to be able to say, with confidence, when certain deals will close. Then those deals have to close pretty much on the schedule you predict. This is what it takes to have success as a business development leader and as an entrepreneur.
But the challenge is that it’s very difficult to know who is ready to go versus who is a tire-kicker. The best way I’ve discovered to address this is to uncover, early in the dialogue, the five key sales-ready indicators of professional service buyers. This strategy, if you use it well, will guide the prospect toward the best possible solution for them and make your predictions highly accurate. In this approach, the prospect wins and you win. Let me show you how to do this.
ONLY AFTER YOU’VE UNCOVERED AND CONFIRMED THE FIVE SALES-READY INDICATORS ARE YOU IN A POSITION TO PREDICT A CLOSE.
THE FIVE SALES-READY INDICATORS
The five key indicators of sales-readiness are:
- Need – for which your products and services are a good fit.
- Budget – that is appropriate for the service levels required.
- Timeline – in which prospects must act or there will be consequences for them.
- Reason – a specific reason to take action, usually a presenting issue.
- Dialogue – a willingness to explore next steps and define the best solution.
There is a lot of meaning in these words, so let’s unpack them a bit. Let’s start by looking at Need. When I use the term Need, in the context of selling services, I’m referring to a broad set of needs that are a good fit to what your firm does.
Here is my experience with Need. Most prospects really don’t know what they Need. They can describe the results they want to see, but they don’t know how to achieve those results. Often, they don’t know what services they actually Need. This is where your ideal client profile really helps.
In my last thought piece on this topic, I showed you how to build an ideal client profile and describe the top 5 goals, opportunities and challenges of ideal clients. These three – goals, opportunities and challenges – are roughly what I mean by Need.
Now let’s look at budget. That’s pretty straight-forward. Either they have budget or they don’t. What’s far trickier, however, is uncovering if the budget they’ve set aside is appropriate to the services fees that are required to address the Need. In other words, if the prospect assumes your fees are $10,000 when in fact your fees are actually $100,000, you have a serious mismatch on budget expectations.
You want to clarify budget expectations as quickly into dialogue as possible. I call this getting the money question off the table. There is nothing more frustrating for you or for prospects than to discover, once you are deep into dialogue, that budgets expectations don’t align. Everyone loses in that scenario.
Timeline is also pretty straight-forward. Some prospects are ready to move ahead right away while others are still making up their mind. Timeline becomes a bit more complex when you sell multi-phased service packages, where there will be numerous timelines over the life of the engagement.
Reason is somewhat different from Need. I think of Reason as a specific reason to take action soon. Sometimes these are described as pain-points or problems. But Reason is usually just the tip of the iceberg, in my experience. Reasons are often symptoms of much more significant challenges.
Dialogue is all about the willingness of the prospect to engage in the conversations that are necessary to help define the best possible solution for their needs. I think of dialogue as a litmus test of readiness. If someone is not willing to engage in serious dialogue, they’re not really ready to move ahead.
So just to recap – need, budget, timeline, reason and dialogue - these are the five sales-ready indicators. Now let’s explore how you use them.
THE ROLE OF THE BUSINESS DEVELOPMENT EXECUTIVE
Your role, as a business development executive, is to uncover all five sales-ready indicators early in the dialogue with prospects. I also recommend that you confirm these five indicators after an initial conversation with prospects via a follow-up email. Your job is to confirm that all five characteristics are in place and that it warrants your time to give the prospect your attention.
You’ll notice that I used two terms here: uncover and confirm. I believe that success in selling professional services comes down to these two terms. Your success will be determined by how effectively you ask the right questions to uncover the five indicators.
But then you also need to confirm that what you’ve heard is what the prospect actually meant to say. I prefer to do this with follow-up communications after an initial meeting or two where I map out the five indicators and ask the prospect to confirm that what I’ve described is what they meant to say. Only then can I be confident about moving ahead.
Here is my thesis to you. Only after you have uncovered and confirmed the five sales-ready indicators are you in a position to predict a close. Far too often, business development people make their forecasts on hunches or gut-feelings. These are often wrong.
SELLING TO INDIVIDUALS VERSUS BUSINESSES
Before I go further in describing how to use the five sales-ready attributes, I want to address a key concept. Yes. You need to uncover and confirm. But the question becomes – with whom do you uncover and confirm? If you get this part wrong, you can still have a poor close rate and inaccurate predictions.
Let me share with you how to fix this problem. Most service firms either sell to individuals or to businesses. This has a great bearing on who you enter dialogue with to uncover and confirm the five sales-ready characteristics.
If you sell services to individuals, usually you will be dealing directly with decision-makers. In my experience, these service buyers are often very sophisticated and do not like being qualified. The way you go about uncovering and confirming the five sales-ready characteristics will likely determine whether or not they move ahead with you.
If you ask the right question but in the wrong way, with the wrong tone of voice, the prospect may disengage. Touch really matters with this group. Service verticals that sell directly to individuals often include:
- Medical practices
- Financial advisors
- Non-corporate law firms
- CPA firms
If you sell services to businesses and your fees are more than $10,000, it is very likely that you will be dealing with a committee of decision-influencers and decision-makers. This is a whole other kettle of fish. Service verticals that sell to businesses often include:
- Management consulting firms
- Technology consulting firms
- Accounting firms
- Architecture, engineering and construction firms
- Corporate law
I don’t have time in this short thought piece to describe all of the considerations for uncovering and confirming the five sales-ready attributes for committees. So let me provide a few guiding principles.
First, it is very important to discover the decision-rights of everyone on a committee. Are they a decision-maker, a decision-influencer or a decision-wrecker? Second, it’s important to discover their role. Are they an economic buyer, a technical buyer or some other type of buyer?
Third, it’s crucial to ask the right people the right questions. In other words, it’s not a great idea to ask the technical buyer about the budget because they may not have the best insights. Instead, ask the economic buyer about the budget.
Fourth, and maybe most importantly, help the committee establish their priorities and create a unified vision of the outcomes your engagement should produce for them. This process can take some time and effort on your part, but it greatly increases the accuracy of your predictions.
An important part of creating unity has to do with uncovering and confirming all five sales-ready characteristics with the entire committee. Here is a relatively simple way to do so. After your initial conversations to uncover need, budget, reason and timeline, send an email to the entire committee that describes what you’ve heard up to that point in the conversation.
Ask all committee members to confirm that what you’ve described is accurate. If everyone confirms, you have justification for moving ahead with confidence. If they don’t confirm, your prediction of a close should reflect that.
HOW TO UNCOVER THE FIVE SALES-READY INDICATORS
Now let’s explore how to uncover the five sales-ready indicators. First, I believe that selling professional services is ultimately a process, a set of steps that you should follow pretty much every time. This approach produces consistent results that you can count on.
In my next thought piece on selling professional services, I’ll outline the master plan for navigating the entire B2B complex sale. But in this piece I want to focus on the early stages of dialogue and creating the triple win – where the prospect wins, you win and your company wins.
To uncover Need, I recommend that you ask open-ended questions, not questions that can be answered with a yes or no response. I recommend that your questions should be slanted toward the top goals, opportunities and challenges outlined in your ideal client profile. This is where most of your dialogue should focus in the first meeting or two.
To uncover budget, I recommend two approaches. First, you can simply ask the prospect about their budget. But often times this will not get you an accurate answer. Second, I recommend that you describe your fees for an engagement that is similar to what the prospect is considering. Then you can ask if that sort of fee-structure is acceptable to them.
To uncover timeline, I recommend that you ask the prospect about what is causing them to take action now. Usually this will indicate some type of consequence that is on the horizon for them. Of course, you can also ask about when they plan to make a decision and move ahead.
To uncover reason, a presenting issue, I recommend that you ask the prospect about their immediate concerns. Usually this will give you the tip of the iceberg and the current pain-point.
HOW TO AVOID FORECASTING DEALS THAT WON’T CLOSE
If you are struggling to accurately predict close-rates, I have five suggestions for you.
- Don’t delude yourself. Just because someone enters dialogue, that doesn’t mean they’re ready to spend the money or time required to address their need. Follow the process of uncovering the five indicators and you will KNOW they are ready.
- Get the money question off the table early. I try to do this in the first meeting.
- Confirm the fit to the psychographics of the ideal client profile. If you don’t have an ideal client profile, you need one.
- Get confirmation from the prospect that what you’ve heard is what they meant to say.
- Share what you have uncovered and confirmed with a colleague and ask them to punch holes in your theory.
I also recommend that you formalize the questions you ask through an interview guide that you can use in initial meetings. This will help ensure that you address need, budget, timeline and reason even if time is tight in a first meeting or two.
THE BENEFITS OF FOLLOWING THIS PROCESS
In the mid-size service firms that we serve, deal-forecasting is the life-blood of the firm. This is especially crucial in firms who sell to committees where the dollar amounts are large and winning the deal is like fresh rain on a parched day.
Senior management will lose faith in you if you cannot accurately forecast deals. Partners who mutually bear revenue generation responsibilities will experience problems and, in some instances, partnerships can dissolve over this very issue.
The strategy I’ve outlined here will help prevent those problems. This approach will increase the confidence of everyone around you that you know what you’re doing and are a true professional – that you’ve got it under control. This strategy will help you earn respect and trust.