Go or No-Go, that is the question
There’s a key moment during the process when you need well-defined criteria that aren’t open to interpretation.
So how to you assess how promising a deal is, you ask? It’s very simple. Focus on two questions:
- What is the expected potential?
- What chance do we have of closing the deal?
The potential is very often clear-cut and more easily “scorable.”
The same cannot be said of the probability of success, which involves analyzing sales performance, which is often a weakness for organizations.
How to make rational decisions
The Go/No-Go is a bit like the discussions leading up to an arranged marriage between two mafia families. They try to picture whether the marriage will last, but also whether the alliance will be lucrative for both camps. Will they come out on top? Basically, you look at all the options over the short, medium and long term.
In business, you need to explore three elements when looking forward:
- Technical potential
- For example, do we have suitable technical expertise? Solutions that stand out from the competition?
- Are we going to acquire substantial know-how?
- Sales potential
- For example, have we made inroads with this client? What influence do our contacts really have on the project? What are our references for this type of contract?
- Financial potential
- For example, are we willing to invest the necessary time/budget before the sale? Do we accept the probable target profitability?
You obviously need to formulate each question based on your business, and depending on the type of answer, you can assign grades.
Of course, that requires insights and very granular qualitative analysis of the decisive sales performance criteria.
- How well do we know our contact and what leverage do they have in decision-making?
- How much does a sales visit cost us? What about the cost of drawing up a bid to a call for tenders?
- What technical expertise is a difference-maker?
Three guiding principles for a clear-sighted Go/No-Go strategy
We’ve drawn from our experiences at Halifax to establish three practical guidelines for devising a clear strategy:
- Go/No-Go makes sense for every type of business, because systematic competitive bidding is becoming widespread in most sectors, due to pressure from procurement departments. This is even more true when high-impact marketing brings in a lot of leads, enabling (requiring?) a more selective approach to sorting out prospects.
- Always have a good financial specialist or management controller in your team! They can get to the bottom of things like the actual sales expenses of a given action, or the actual margin made on a client or a type of deal.
- Learning to say no is often harder (or just as hard) for sales managers as it is for their teams.
Once you have consensus on the principles, you can get to work on a few big questions with the teams:
- Is there a clear, common vision for the company’s sales and marketing strategy (Price strategy, Product strategy, Product + strategy, Solution strategy)?
- How can we make the jump from a management culture based on past results to a management culture focused on the sales process?
- Do we know the sales expense indicators and can we match them up with the revenue generated?
- How can we incorporate qualitative behavioral variables (level of staff motivation to work with a given client, or for different in-house teams to work together)?
- That’s why we prefer to add a third level of analysis alongside Potential/Probability, which we call Pleasure, or Partnership (a cliched term that we are less fond of, even if the meaning fits).
- What impact do personnel choices on either side have on the final result of the bidding process? As well as on the resulting medium-term business relationship, in a broader sense?
- “The right people at the right place and the right time” is becoming a key success factor that requires a much more agile, free-flowing sales organization in terms of territory (discussions and assignment of leads) and time management (variable pay for an ultra-tight deadline)?
Let’s close with an adage well known to experienced sellers: “There are always two victors in the bidding process: the final winner and the one who exited the race first.”
If you’re unsure of your client’s intentions, you can also sing them a tune to see if they are really interested in your offer. Perhaps this one by Brigitte Bardot, in which she asks, “Do you want to or not?”
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