What is your competitive advantage? No, really! What is your competitive edge?
Sounds like a simple question, and when asked, most distributors, reps and manufacturers answer pretty quickly and predictably.
If your goal is to excel in a competitive market, continuous attention to systems, methods, and processes that offer a competitive edge is essential. This series of articles focuses on areas proven to give companies a real competitive edge, yielding measurable results.
These methods and processes must be things you and your team can focus on – and control – internally. Excuses related to external factors such as the economy and industry softness need not apply.
The pursuit of sales is like going into battle. Most companies go into battle relying on past successes with their people, products, service and experience. It’s time to go to battle with some new and different weapons.
So, “What is your competitive edge?” Most likely, your answers are the same as that of your competitor and that, by definition, is no edge at all.
Focus on the 180 – Front-End Sales Cycle Management
I’ve encountered many companies over the past 20 years in the industrial sales world that are managing their business from the back end of the sales cycle. Be different. Gain a valuable and proven competitive edge by shifting your focus to the front end of the sales cycle.
It sounds so simple and even logical, but it’s been my experience that companies typically fail or fall short in this area. Why? Old habits are hard to break. Companies and individuals naturally resist change, and this particular change in culture can be difficult as it requires a change in the way your sales team typically works.
The key is to honestly evaluate your approach. Let’s get on the same page with terminology: The “back end” is the Quote-to-Order stage of sales cycle. The “front end” is the Lead and Opportunity stages, or the first 180 degrees of the 360-degree sales cycle.
Starting with the Order Stage and working backward, critically analyze these four stages in your business. The following grading scale will reveal how your company is doing at each stage and will typically exposes the fact that most companies have not focused sufficiently on the front end to establish effective processes.
On the following, grade your company from 1 to 5, 5 being excellent and 1 being poor.
Order Stage = _____ (Total Average Score)
- Order write-up standards =
- Order retrieval system =
- Payment follow-up process =
- Reporting (30-60-90) =
Quote Stage: _____ (Total Average Score)
- Quote generation standards and procedures =
- Quote retrieval system =
- Quote follow-up process =
- Reporting (open, won, lost, overdue) =
Opportunity Stage: _____ (Total Average Score)
- Opportunity Management system =
- Standards that define an opportunity =
- Proactive follow-up process and procedures =
- Reporting (Pipeline, Forecast) =
Lead Stage: _____ (Total Average Score)
- Lead generation system =
- Lead qualification process =
- Lead follow-up procedures =
- Reporting (Open, Closed, % converted to Opportunities) =
So how did you do? Were your back-end numbers higher than your front-end numbers? If so, the good news is that you now have an opportunity to focus on the most critical phase of the sales process, to change and gain that competitive edge.
The scores I typically see when asking companies to share their results are:
- Stage 1 – Lead: 1s & 2s
- Stage 2 – Opportunity: 2s
- Stage 3 – Quote: 3s & 4s
- Stage 4 – Order: 4s & 5s
After the first pass, document every step of your company’s existing processes and procedures from Lead to Opportunity to Quote to Order. Then, do the exercise again and see if you come up with same score. With this documented focus on your front end you can now critically review and evaluate your methodology: Where are the gaps, inefficiencies, and lack of visibility specifically at the Front End?
The Holy Grail is for your company to get to a 4 or 5 at each of the stages and when a focus on the front end becomes the new culture within your company.
The most critical time in the pursuit of sales is between the opportunity and quote stages. This is where the rubber meets the road, sales are won and you have positioned the prospect to transition to the quote. Weaknesses in processes and management at this critical juncture will put you on the outside looking in.
The purpose of this exercise has been to get you to think about how your company is managing the early, critical stages of the sales process. This does not have to be complicated: Keep it simple. Put equal emphasis on processes, procedures, and visibility at all stages of the sales cycle. Don’t neglect the front end. This is where you can separate yourself from you competitors.