Are You Headed For a Revenue Crash?
June 22, 2013
Could you be headed for a revenue crash? Here are six…often missed warning signs.
- Sellers view client attraction as drudgery sales work. Many consider it a junior-level activity and believe that it is beneath them. Unfortunately, sellers’ short memories result in their forgetting that prospecting created the leads that they are now closing. Companies that are prone to busts don’t measure leading Key Performance indicators such as outbound call volumes. As a result they find out too late that it’s going to be a lean sales reporting period
- Poor performers are in place for more than 2 quarters in a row. Sales leaders who allow sellers to continue on without hitting quota and accomplices in their poor performance. Far too often sellers are kept in place long past their ramp up periods, far too long into slumps, sometimes for years performing at poor levels. If coaching does not work to bring the seller back up to acceptable performance quickly they must be replaced.
- Sellers believe that the after sale client enablement is not their responsibility, so they bow out. They lose contact with the client, hand the relationship off to an implementation team, and fail to monitor progress and ensure a successful ongoing relationship. Some companies create this situation by passing the client between teams of specialized roles (often labeled as hunters, farmers, account managers, growers, etc.). In doing so, they create inconsistent sales performance because each time a new relationship is created between the client and a new company representative, trust is eroded, continuity is lost, and future sales are slowed.
- Sellers “fire and forget.” When sellers pass a client relationship off to another team member, they often mistakenly buy into the adage “no news is good news.” They assume that clients will contact them if they need anything, or will reach out to the company directly when they need to buy more or have other projects in mind. Nothing could be further from the truth.
- Management over-focusing on closing at all costs. There is a tendency for managers to focus only on closing deals rather than taking a holistic approach to all areas of the business. When this happens, sales activities that contribute future and ongoing profits erode. Sales leaders should be monitoring and measuring their teams on all aspects of client engagement for the entire life cycle of the client. By adopting a series of field-tested strategies that systematically attract a steady flow of prospects and manages them throughout their entire lifetime with you consistent revenue generation will become the norm rather than the exception.
- The company is over focused on one product line at the expense of all others. We see many companies and sellers excited by the “bright shiny new object” that is introduced. This excitement leads to old product lines or existing customers being ignored while all attention is placed on the new opportunities. This behaviour is dangerous for two reasons.
- The lack of attention to existing customers means that you are ignoring your most lucrative revenue source and
- Focusing only on the new products at the expense of the older one contributes to sharp dips revenue as you are building traction for the new products in the market. At the same time, companies that don’t pay attention in the short term to all their product lines will suffer and erosion of those ignored product lines in the market. Customers begin to assume that you are phasing out of that business and the competition strikes fast. Like lions on a weak and injured gazelle. Before you know it the neglected product line market share has been eaten away at by your competition. Winning back this lost market share is a difficult, if not almost impossible task.
Keep your eyes peeled for these early warning signs and “nip them in the bud” when they arise. Doing so will ensure a steady state of sales growth throughout the year