In the first article in our Organize step in David Allen’s Getting Things Done process, I noted that there are three factors that categorize an opportunity so it can be organized. We’ve covered time and probability, and now we’re ready to see what happens when you link those two. You get the final factor, priority.
Mathematically, Time + Probability = Priority. Or maybe it’s Time x Probability = Priority. It doesn’t matter. It’s not so much a calculation as it is an evaluation.
That’s because there are too many variables in the equation. Time is infinite, and absolute. As we discussed, you must somehow normalize time to bend with your sales cycle while at the same time being meaningful. So we did that with three flexible phases.
And probability defies quantification. Not only variables, but moods and personalities are involved, so forget a precise number. Go with six approximations. That’s the best you can do, and in the imprecise world of sales, it is very effective and accurate.
So if it’s not strictly mathematical, how do you factor time and probability to get priority? Glad you asked. It’s really quite simple when you see it. It’s also patented, so underneath the simple there’s a lot going on.
In determining probability, we created a 3 x 3 matrix assessing the customer factors and the seller factors in any sales opportunity with a low/medium/high ranking. In normalizing time, we divided the sales/buying cycle into three phases. The result, a three-dimensional cube, three cells to a side, of twenty-seven possible combinations.
In words, these combinations can be described as situations such as “you’re early in the sales cycle (phase 1) with a customer who is very likely to buy something (will it happen = high), and you’re the preferred vendor (will we win = high).” This might be an existing happy customer buying some more of what you sell, and your probability of winning is 80%. (It’s never 100%, is it? Not even when you’ve been told you have the deal. Stuff happens.)
Or, “you’re in the middle of the sales cycle (phase 2) and there is a possibility the customer will buy something (will it happen = medium) and a possibility he will buy from you (will we win = medium).” This might be a new customer who has potential budget issues and you haven’t yet established your product as the best solution. Here you only have a 40% probability of winning.
Or, “you’re late in the sales cycle (phase 3), the customer is possibly going to buy something (will it happen = medium), and you are in a very good position if he does (will we win = high).” It’s near the end, and your product is the preferred solution. You’re just waiting to see if the new VP of finance, who is the wild card, releases the money. You have a 60% probability of winning.
So, how would you prioritize these situations? As it happens, they are all the same. They are all a second-level priority, something you should work on after making sure the more urgent opportunities are current and you have nothing to do to move them forward.
How can that be? The probabilities are all over the place. There’s absolutely no common thread that runs through all the situations.
But there is a common thread. You just have to think about it. In every case, these opportunities are winnable and will require your attention. However, there is nothing urgent nor critical that you must do at this moment to effect that end.
In situation 1, you’ve done your job and you just need to ride out the sales cycle, probing, paying attention, making sure there are no surprises.
Situation 2 isn’t a great opportunity for you. It may not happen, and you aren’t positioned to win if it does. You’ll need to do something about that, but not before you’ve worked the opportunities that are certain to result in a sale by someone.
The last situation is near closing and you’re in the driver’s seat, ahead of the competition. However, the result is not yours to influence. Someone up the line who you’ve never had a chance to sell to will decide if the customer is spending the money.
These opportunities are all second tier. There is a first and third tier as well, and some of the twenty-seven situations in the priority matrix will go there. And there are special cases where you need to act decisively or walk away.
There you have it, an opportunity categorization system that uses the critical elements of every sales cycle – time, probability, and priority – to rank all of your opportunities.
Next week, we’ll look at the Review step in the Getting Sales Done process.
This post is part of the Getting Sales Done series. Here are the other articles in this series:
- Getting Sales Done #1 – Introduction
- Getting Sales Done #2 – Collect: Gathering Opportunities
- Getting Sales Done #3 – Process: Sales Process
- Getting Sales Done #4 – Organize Part 1: The Sales Cycle
- Getting Sales Done #5 – Organize Part 2: Sales Phase
- Getting Sales Done #6 – Organize Part 3: Probability
- Getting Sales Done #7 – Organize Part 4: Priority
- Getting Sales Done #8 – Categories: Grouping Opportunities for Maximum Return
- Getting Sales Done #9 – Review: Reviewing your Opportunities
- Getting Sales Done #10 – Action Part 1: Applying Action to the Science of Selling
- Getting Sales Done #11 – Action Part 2: Selling your Solution
- Getting Sales Done #12 – Action Part 3: Making the Close