Performance indicators and other metrics are essential for developing a sound sales strategy. Yet, they can risk the value of their data by over-emphasizing quantitative data at the expense of qualitative feedback.

In win loss analysis, it’s tempting for stakeholders to become consumed by slicing and dicing numerical data into as many segments as possible. The thinking generally runs like this, “The more cross-tabulations we have, the better chance we have at uncovering the nugget of intelligence we need.” The results of segmenting data are no doubt insightful – just one comparison of performance between wins and losses can pinpoint both the strengths and weaknesses of your sales approach.

However, a savvy sales leader knows that numerical data has its limits. It only tells what, and if left without its context, quantitative data can’t get close to telling you why. With this in mind, it’s befuddling when a sales leader chooses to discard the validity of qualitative data. What they don’t realize is that they’re compromising the value of their numerical data by under-valuing the qualitative feedback from their clients.

“It’s too subjective” is usually among the first reasons for down-playing qualitative data. The temptation to minimize the relevance of anecdotal evidence is strong, and it often goes hand-in-hand with cognitive dissonance. In cases where the feedback is glaring or unfavorable, it’s easy to think, ‘It must not be true; besides, it is only one example and that response could be flawed.’ It’s true that analyzing data within the context of a group will help identify the general consensus. But here’s where ignoring information in the name of subjectivity goes wrong: If you’re not willing to listen to your clients’ concerns now – regardless of how ‘out there’ they seem to you – how can you expect to sell to them in the future?

“The numbers are sufficient.” Stakeholders who assume that numbers will tell their client’s story risk losing key intelligence. For instance, the production of countless cross-tabulations, frequency distributions, charts, and diagrams can end up consuming the analytical process. If absent contextual analysis, the result is just data. Not intelligence. This exemplifies the endemic problem of information overload: analysts and stakeholders alike are unable to make sense of data, in part, because there is too much data to analyze. Qualitative feedback can not only contextualize numerical data, but it can also identify priority concerns, enabling you to allocate analytical resources advantageously. Finally, although numerical data alone may identify problem areas or best practices, if you don’t know whythe numbers are the way they are, how will you be able to leverage that?

“It’s just one client’s response.” While one respondent’s perspective shouldn’t necessarily constitute the sole reason to revamp your sales strategy, there are cases where you don’t need a large sample size to know that a sales tactic isn’t working. For one client, their sales performance significantly dropped between the first and second half of the fiscal year. Diving into their data revealed that a single outlier was likely responsible for this drop. That respondent described an awful sales experience, largely due to poor responsiveness on behalf of the vendor. While it was tempting to write off that response as “just one bad experience,” further investigation revealed that many respondents felt the same way – only they mentioned it less harshly.

Writing off a response because it is “just one” is risky. Outliers are often a starting point to identify those with similar viewpoints. It’s to your advantage to use qualitative feedback to contextualize performance indicators. Additionally, a single response can be sufficient to make a tactical sales decision. There are scenarios where you don’t need a large sample size to know that the point is valid. Uncovering something like, ‘The sales representative didn’t call me back and missed our presentation day,’ implies a clear action-item. (Read more about one as a valid sample.)

Remember that the combination of quantitative and qualitative data with added insightprovides actionable intelligence. Your ultimate goal shouldn’t be to emphasize one form of data over the other, but rather to use them both to your advantage. Relying on qualitative data to both challenge and corroborate quantitative feedback is a sure way to get the most out of your win loss program.

[The sales guy] darted immediately toward the Motorola Droid Razr. He explained that this would download anything 10 times faster than the iPhone.

“So you think I should buy this Droid Razr?” I asked.

“Well, no,” said Phil. “I’d get the Galaxy Nexus.”

[Read the whole story.]

Do you ever wonder what happens in your sales channel, particularly when you sell through distribution?

When we analyze win/loss information we hear one thing from the sales rep and often something entirely different from the buyer. And when you’re selling through distribution, it’s even more important to know why you win and lose deals. Do sales people push your product (or someone else’s)? Do the sales people know your product (or someone else’s)?

Do you understand what happens from the buyer’s point of view? If you’re not doing win/loss analysis, you’ll never know.

Join me for a webinar with Accept360 on Thursday, May 10, at 1:00pm ET.

Be sure to arrive by 9:45 when I’ll be participating in a roundtable panel discussion.

Will you be there?

(And kudos to the Planning Committee. Nice job all!)

Join Jon Gettinger of Accept Software and me on May 12, 2012 at 1:00pm ET for a discussion on improving your portfolio using “voice of the buyer” interviews.

This webinar will highlight three critical touchpoints–before, during, and after an implementation—and explore the insights we can use to make better product decisions. It will be a highly interactive session, so bring lots of questions!!

Sign up here.

Thinking it would make things easier down the road, I started with a PowerPoint template in Mac Office. Frankly the drawing tools are better there anyway. Got things working to my satisfaction. Then I moved it over to Keynote to get some of those fancy transitions. Nice.

When I saved it to my iPad, all hell broke loose.

I could export from Keynote to PowerPoint and back–no problem–but it was the font problems that drove me crazy.

Turns out the fonts on the Mac are different from the fonts on Windows and both are different from the fonts on iPad. You can’t embed fonts on the Mac but you can on Windows but you can’t on iPad.

I eliminated Keynote from the equation and tried to figure out which fonts were and were not available. Finally threw up my hands and changed everything to Ariel because the Mac Office templates used fonts that didn’t have a Windows equivalent. So now the presentation is ugly but at least it is standard.

There’s more to the story (and I reached a resolution eventually) but that’s not my point.

I spent most of Saturday afternoon working around the products. In many cases, the tool in one product worked better than the tool in another; neither product offered a superset of capabilities. And if a product manager from either product asked me, I would rant about the product capabilities and these problems.

But these are not market problems; they’re product problems.

When doing customer interviews, how much do you hear about–and focus on–product capabilities and problems?

“I wish font management could be easier.” It’s an interesting insight and probably something they should worry about but it doesn’t really make the product more attractive to a buyer.

But what about this? On another topic, a friend said, “I would like to have patterns and trends presented to me. Today I’m forced to read the details in hundreds of reports, hoping to spot them on my own.”

“Improve font management” or “Find patterns so you don’t have to”–which of these would move the revenue needle?

Now take a look at the insights you’re getting from your customer interviews, win/loss reports, enhancement requests. How many are about improving the design of existing products and features? And how many are about improving a process or addressing a problem?

Are you looking at product requirements or market requirements?

We should be exploring how to help customers run their businesses successfully, not just how to run our product successfully.

Now… how should you revise your discussion guides, interview forms, and survey questions to uncover more market requirements?

If I could share one thing with sales people (and their managers) in the voice of the buyer, I’d tell them this: “Please prepare.”

Have you ever sat through a sales presentation or demonstration bored to tears? Is it because the salesperson was not engaging enough or entertaining enough? Or, is it because you believe that the presenter understands neither his own products nor your business needs?
Here’s an all-too-common sales call. First there’s a quick introduction of the sales team and the company. Then, the sales guy’s introduction: “I’m the sales guy so you can’t trust me, ha ha ha.” Next, there’s the team intro: “Bill is our product expert. He knows everything about everything. If he doesn’t know it, then no one knows. So I’m gonna shut up and let Bill start the demo.”

We have worked with some really great sales teams; I hope you have too. Because one of the core offerings at Primary Intelligence is win/loss analysis, we hear some great sales stories, and, let me tell you, we hear some horrific ones.

Here is one insight for you to share with your sales professionals.

Prepare!

In speaking with many different decision makers and sales leaders around the world, I am often told that the salesperson lost the deal because he was lazy. He was too lazy to spend 10-15 minutes researching the company that he was selling to. He was too lazy to listen, to ask insightful questions, to understand the problems his prospect was trying to solve with the solution he was seeking to purchase. He was too lazy to deliver a presentation addressing those concerns.

Actually, I don’t think I’ve ever met a sales person who was lazy. But I have certainly met those who have under-prepared for a sales visit.

Salespeople would be more successful if they took just a little bit of time as a part of regular pre-call planning to learn about their prospect’s business and to listen–to tailor their sales pitch in a way that properly demonstrates how they understand the prospect’s business and the business problems that need solving.

I hear this complaint time and again… both from sales leaders and from potential customers.

A VP of Operations visited a customer to talk about the vendor’s evolution to a SaaS model. The sales guy said, “Our VP is here to show you our new product. Go!” But the VP said, “Hang on, I’d like to ask a few questions first.” Despite the sales person’s annoyance, the VP asked for the customer’s concern with three issues. And the customer was just thrilled to talk. He explained how those three issues affected his compensation, his perception within the company, his struggles leading his team, and the resulting difficulties with the senior leaders. The VP then explained how the product would address those specific issues. Yeah, it does a whole lot more, but this customer only cared about three specific things. The customer and the sales person were both delighted with the outcome.

After the call, on the drive to the airport, the sales guys asked, “How did you know about those three issues?” The VP said, “Well, since I didn’t know much about this account, I reviewed their website last night. These three issues were called out in their press releases and product information.”

And here’s the amazing part: the sales guy said, “Man! I’m going to take you on all my sales calls.” (Not, “Wow! I could do that myself!”)

If the prospect did not believe that your company had the basic capabilities to solve a particular problem, a meeting would not happen at all. After a solution has been identified, it comes down to fit and relationship. What are your sales teams doing to build both personal and professional relationships with your clients?

Decision makers do business with people they respect–and show respect to them. Showing interest by researching a prospect’s business and asking good questions to hone in on that need will take a salesperson a long way in building the relationship. Of course, sales people like to talk, but the sales people who are good listeners are winning deals.

Generally speaking, you aren’t learning much when your mouth is moving.–Steve Johnson

What can you do to make your sales people listen more and talk less?

(Discuss.)

Many sales people and most executives think one interview constitutes a completed market study. “I talked to a guy so we totally should do this.” Or better, “I talked this over with my [wife/ husband/ child/ friend] and they think it’s a great idea.”

Meanwhile, technical folks (particularly those who don’t want to do whatever it is you want to do) want a census of the total addressable market. “We can’t make a decision until we’ve polled 100% of the market.”

Okay, there oughta be a number between 1 and infinity, doncha think?

So research teams discuss “statistical significance,” using standard deviations and sigma and other research terms. See http://en.wikipedia.org/wiki/Statistical_significance for more–if you can understand it.

What we really need is just enough data to see a pattern. Enough interviews to hear the same idea repeated often enough to draw a conclusion, to see a trend.

Professional researchers tell me that you can survey as few as 7 people–if they all agree. Or 31 if they don’t.

But I’ve had experiences where 1 is enough.

You’re talking with a recent prospect who chose the competitor’s product and he says, “I couldn’t stand your sales guy. He talks like he’s in a locker room. And I just can’t tolerate coarse language.” Do we need to gather more information on this scenario or shouldn’t we just have a sit-down with the sales person?

“I went to your website and couldn’t find out anything about your new product.” And sure enough, you can’t find anything either. Do we need to do another interview? Surely we can fix our website without any more research.

“I’m confused about which configuration is right for my application.” Hmmm, seems easy to assume that we should have a list of ideal configurations on our website or as a sales tool: package A has this; package B has that.

We certainly don’t want to be jumping from project to project, from idea to idea for every single customer event. But sometimes your customer provides an insight that justifies an immediate response.

When do you need more than one? Well, it depends on two things: the audience receiving the data and the scope of pattern uncovered. Are you asking the CEO for $500K to retrain a global sales force? or are you needing a 20 minute phone call with one rep to correct a behavior. Clearly, one requires more data than the other.

Add a comment below to tell your story: When has one data point been enough information to make a decision?

Examining the reasons behind why you win and lose deals will help you better understand your buyer’s decision-making criteria, improve your win ratio, explain why your competitors are winning, and identify training needs for your sales organization.

Win/Loss analysis may be one of the most important strategic activities for marketing and product leaders. Yet we often relegate this critical activity to other parts of the organization or to a traditional survey firm.

What did Steven Covey teach us? The time you spend on the important activities will reduce the time wasted on urgent activities.

Yet as an industry, we tend to focus on the urgent and the tactical. We’re involved with firefighting and emergencies. Product leaders and executives and developers get involved in daily hysteria when instead we should be examining behaviors and patterns that eliminate those emergencies in the future.

Sales people in particular are encouraged to be tactical. “Make this call.” “Check back with that customer.” And we want that. After all, instead of obsessing on the last deal, we want our sales execs concentrating on the next client. We want our sales professionals looking ahead instead of looking back.

We often see teams do win/loss reporting for one big deal that fell apart. This is like a post-mortem: what did you do wrong? In medicine, a pathologist examines the patient looking for evidence of what the surgical team did wrong. This is followed by a debrief with the surgical team and, at least on TV, often looks like a blame game. “Why did you do this?” “Did you know you did that?” But in addition to examining each instance, today’s hospitals also analyze for patterns. A series of health problems may instead lead back to the personnel who handled the charts or to a problem in one of the surgical theaters.

In sports, you have the play-by-play, picking apart each individual action throughout the game. And that makes for good television. But overall improved team success doesn’t come from reporting the plays but from watching multiple plays in multiple games against multiple competitors and examining what the team does again and again, both right and wrong.

Reporting is what an announcer does.

Analyzing is what a coach does.

And that’s what we should be doing in win/loss. Analysis is not a one-time event; it’s a process.

Product managers, competitive intelligence professionals, and marketing leaders should be actively analyzing both win and losses to see what patterns emerge. What do we do right? Let’s make sure everyone does it. What do we do wrong? Let’s fix that for all our sales teams. Let’s develop our own best practices and help our sales teams close more deals faster.

By the way, there are many places in the lifetime of a customer where a win analysis should take place: after the sale, after the initial implementation, after the full implementation, and each year thereafter. After all, don’t we want to know what we’re doing right year after year? We want to ask customers continually: “Are we still winning your business?”

As for losses, when did we lose the sale? At initial evaluation? Or even before serious consideration? There are many places in the sales process to do loss analysis: after a qualified lead chooses not to go to the next step; after the presentation fails to move the client to an evaluation; after losing an RFP, ITT, or other bid.

With up-to-date, accurate win and loss information, we can make for a more successful sales process. Marketing leaders should be examining loss information as a technique for more effective messaging, qualification criteria, sales tools, customer collateral, and more. Product leaders will see how improving the product features or even the key elements of a product demo could result in more revenue.

And the savvy sales executive can finally answer with confidence the question: “How are your sales teams doing?”

“Too many marketing people go through the motions of visiting customers, looking for facts that will confirm their previously formed opinions of what should be done.” —Al Ries & Jack Trout

Wikipedia writes,

Market Intelligence, occasionally called business intelligence, is a branch of market research, involving collation and analysis of available and relevant information and data on specific markets.

And because it contains the word “research” we often relegate it to a research department.

A product manager told me recently, “We have a market research department. They claim to be experts… but they’re experts in technique, not content.”

In fact, the phrase “market research” always tends to evoke focus groups or extensive interviews or surveys, all done under the watchful eye of research experts in white lab coats. But every customer interaction is research… if it’s written down.

Over the next few months I’ll be writing about how product and marketing leaders can use different forms of research, from conversations to surveys, to speak with the customers’ voice instead of their own. To help decide which features to include or omit, which competitors we should focus on and ignore, which messages work and which do not.

Market intelligence is critical; market research is a tactic.

“Tell me, in the company you work for do they approve of executives making decisions on the basis of internal beliefs rather than external facts?” – Stephen King

Many companies, however, are not used to this approach and show concern when we suggest it to them. A dangerous tendency to avoid in your win loss analysis program is the “Mine!” attitude, or gatekeeper mentality. If you guardedly dole out the intelligence from the program and “protect” people from what buyers are telling you—you are hurting your program, regardless of your reasons for doing so. If you act as the gatekeeper to the intelligence because you view your win loss analysis program as “job security,” you are damaging your opportunity for career advancement. Over the years, I have seen the promotion of many individuals who ran their programs the right way, and they pointed to their win loss programs as a key catalyst in their advancement.

Two of the questions we get most often are ‘How do we identify which people in our organization should be included in the program’ and ‘How do we get that initial ‘buy-in’ from them?’ In this post, I’ll discuss some methods for identifying key stakeholders and some things you should be aware of in the process. In my next post, I’ll address the most effective practices our clients have used when approaching key stakeholders and getting their “buy-in.”

Who should you include?

A short answer to this would be “everyone who would benefit from the information,” but, in some cases, it is hard to know who those individuals actually are. Depending on your organization’s structure and the specific goals of the win loss program, your list of stakeholders could range from a few individuals to several hundred.

We have found that the best way to identify your initial stakeholders is to ask these three questions:

1. Does this person have access to enough information to identify the most important concerns for their department or for the organization as a whole?
2. Can these concerns be addressed or informed by data gathered from your buyers?
3. Is this person capable of making meaningful changes in the organization’s strategies, products, or processes based on this data?

If the answer to these three questions is yes, then that individual would probably make a good stakeholder in your win loss program. After spending more than a decade helping hundreds of clients with their win loss analysis programs, we have learned that there are at least six primary roles within an organization that almost always meet these criteria. However, other roles could certainly be included as well—the key is to keep an open mind about the breadth of benefits a win loss program can provide.

The six roles that we identify as key stakeholders for a win loss program include the following (not necessarily listed in order of importance):

1. CEO or product division head (the person with P&L responsibility for the product or solution)
2. Product marketing leader
3. Product management leader
4. Sales leader
5. Competitive intelligence leader
6. Sales representative

Organizations that integrate (the key word here is “integrate”) all of these roles in their win loss analysis programs will experience the most return on their investment—the kinds of returns that would make any CEO giddy with anticipation. I have personally seen this time and again. However, this type of win loss analysis program is the exception and most certainly not the rule. Only 20 to 30% of companies implement systematic win loss analysis programs, and, in my experience, less than 10% of those integrate the key stakeholders identified above in their win loss analysis programs.

Companies that refuse to include the roles above will almost never experience the same level of return on their investment as companies who do. (I would go so far as to say you will never experience the same ROI, but I tend to get into trouble when I use absolutes like that). Those companies will still derive great value from their program, but they will be missing an enormous opportunity.

Seeing so much evidence has convinced me that including all stakeholders is critical to a program’s success. Because I know what it can do for clients and because I want to further motivate clients to fully participate, we are offering a substantial discount to clients that are willing to set up their win loss programs and include the six key stakeholders identified above from the beginning. It’s that important.

In the next post on this subject I’ll go over how to get stakeholder “buy-in” and get your stakeholders excited about being a part of your win loss program.

About the Author: Ken Allred, Founder and CEO of Primary Intelligence, is a thought leader in SaaS-based sales intelligence, analytics and sales enablement solutions. He is committed to the optimization of sales, marketing and product management teams through the implementation of advanced Sales 2.0 intelligence solutions.