2024/08/07
by Robert Morris
It is 5p before the board meeting, do you **know** what stage your deals are at?
Surprisingly, (or perhaps not) when I inspect start-up pipelines, I often see deals staged based on rep feel or other loose and subjective criteria. If your deals are staged like this, you do not know where your deals are. Subjective deal criteria are useless because sales people and founders are delusional optimists–we have to be. Where do you think we put deal stage? I guarantee it isn’t where the client is…
Advancing deals because of nice words and good feelings or even rep activities leads to forecasting errors and also to failure to invest in deals with problematic champions which can turn out to be great. Forecasting errors are the root cause of a lot of start-up pain. Forecasting is really hard and it is especially if you put garbage as your root data.
Despite everyone in the selling profession trying to have an internal locus of control over deals, the fact is that deals close when the buyer wants them to close, not when the seller does. In our sales process we are trying to tailor our activities to the thing that we need to do get the buyer to the next stage of their buying journey. You can read a bunch of books about this, but to summarize the ones I’ve read, you can mostly understand the buyer journey for your product, deal size, and industry by fumbling through a few deals. It is important to be mindful of how early customers differ from repeatable ones. You will get a sense of what the buyer needs to move forward from trying it a few times–or even getting coaching from your more tolerant customer. Your activities need to respond to where the buyer is, and deal stage movement should signal that you’ve tested where the buyer is and are correspondingly adjusting your activities to suit.
I suggest using artifacts at each stage to test where the buyer is. Artifacts as I use the term in this post are: documents or records, which are inspectable by both the client and seller management, and which have both the seller’s and client’s participation or assent — this could be as simple as an accepted calendar invite all the way up to a custom-negotiated, fully-executed, joint-venture agreement or other similarly complex contract.
Artifacts are first and foremost a way to test with the client if you are where you think you are. I’m going to show you a somewhat generic sales process below, but the basic idea of it is that no matter how you feel about the deal, there is a sequence the buyer has to go through and artifacts test and can even help the buyer arrive at each stage of their buying journey. A sales consultant I greatly respect talks about the sales process as walking through a ship and closing each hatch behind you. The idea is to definitively close each compartment one at a time. Ideally, you get a written receipt that you’ve closed that section and that the customer agrees that section is completed.
Below I’m going to show what is close to the most basic enterprise sales process and how artifacts enhance that process. Your process should be different. Perhaps you are on the low ticket size of enterprise sales and you can skip stakeholder objections as the champion and sponsor are the only meaningful sponsors (I saw this agriculture a lot) or perhaps something else is different in your sales process.
Below is the generic enterprise sales process that I’m going to talk through in detail with artifacts. When I set-up CRMs I often name the stages just like the below to help everyone keep in mind what we’re doing now on the deal and what comes next just by looking at the board view most CRMs have.
Deal Stage Outline: [Activity -> Artifact]
- Warming -> Meeting
- Excite -> NDA
- Champion -> Deck
- Sponsor -> Acknowledgement
- Objections -> Implementation Plan
- Contracting -> Close
Out of scope of this post is anything that happens upstream with marketing, leads, or prospecting; or downstream around close for implementation. Though you should know that sales engineering and implementation teams can be incredible at producing artifacts–some of the best as they really paint the picture to stakeholders all the things that need to happen.
Stage 1 : Warming -> Meeting
if you don’t have scheduled meetings, you’ve got nothing…
Obviously, this is for enterprise sales of scale and complexity not for product led growth. But if you have a product the requires internal assent and implementation, and you can’t get a meeting you are nowhere.
What you and the buyer are doing at this stage: The activity here is to warm the prospect up to a meeting with the deal champion. If you’re getting a bunch of hot inbound leads, maybe you’re only accepting leads that are already here. If you’re meeting suitable prospects at a conference and determining that you want to work on them after the conference, there might be work to do.
The big mistake here is failing to practice sales myopia — meaning just get the client to do the next thing. Don’t sell them the product. Your job here is not to close, it is get them to the meeting. That’s it. You probably don’t want to get them to the meeting under completely false pretenses and with a closed mind — we’re selling valuable solutions not timeshares — but you don’t need to take them further in outreach than it would be worth a quick conversation.
The artifact and how to inspect it: The artifact here is really simple, it is an accepted calendar invite and a follow-up e-mail confirming the discussion points in the call. The “A grade” here is if the seller establishes custody of the deal by getting the buyer to agree to do homework and setting a fixed time to check on the homework, so in addition to the calendar invite and
A lot of times, they are going to agree something to the effect of, ‘Yes, I’m a real prospect, I’m interested, let’s start working on doing something… Oh you mean the next step in our process is already started on this meeting and it gives you a natural idea about really light piece of homework that I can do to advance the deal? Oh wow, how did you think of that? Did you sell this before?” And you can start to see how artifacts naturally move the deal along.
One part that’s hard to inspect at this stage, is that you really shouldn’t move to stage two until unless you think you’ve met the champion. There is no definitive rule for a champion, with practice in your context you should get the hang of it looking at a combination of title, background, how they talk, and who their boss is. If you don’t think you’ve met the champion, that’s okay, you may have met a guide. Guides can see the promise of your solution but are for whatever reason unable to champion, but are often well connected in the organization. Use the meeting to try to meet others in the organization until you meet your champion.
Stage 2: Excite -> NDA
if they won’t sign an NDA, they aren’t going to sign anything else…
What you and the buyer are doing at this stage: You are trying to get the prospect excited enough to commit to exploring what commercial opportunity exists. The prospect is trying to decide if they even want to invest the effort to truly evaluate your offering. I don’t have a universal prescription — this is the art part of sales here. Depending on the product, industry, and the audience you might establish a great rapport, tell success stories, ask Socratic questions, show slick videos, offer advice, share compelling data that you’ve gathered, tease info under NDA, do something I’ve left out, or use a combination of the above. You want to get the point where your prospective champion says, “Yeah it is likely that you could help us, but for you to really scope helping us, we’d need to share proprietary information” — I’ve suggested this with success in a “Many of other clients…” kind of way when it feels like we are there but the prospect champion won’t say it.
The artifact and how to inspect it: A mutual NDA signed by both parties is one of my favorite artifacts because it is so easy, can be fast, and you learn so much while still pretty early in the process. While an attorney I am related to once said, “NDAs have more value as toilet paper than as legal agreements,” they are incredibly useful as sales artifacts because they confirm the intent of both parties to behave in a genteel and respectful fashion in regards to the discussion while preserving certain IP rights. You also learn a ton as the seller: “will they sign anything?” if so, “how fast?” and “is their legal department a bunch of #)*$*&%Rs?” etc. etc. Also, despite the near non-enforceability of NDAs, there is something about having signatures next to each other on the page that give everyone involved a sense that ‘Okay, there’s an agreement, were working on something, not just talking’ — like everyone at least needs show up to the meeting to say ‘no, not right now’ you can’t just blow this off. In the negative, if the prospect won’t sign an NDA, they won’t sign your contract with non-disclosure clauses in it, and they maybe signaling that they’re talking to you to steal your IP and waste your time.
Here is an Example NDA – that I really like because it is complete and fits on one page.
Stage 3: Champion -> Deck
The heart of the sale
Here is where you document what has the champion excited for their organization and turn a prospective champion into an actual champion
What you and the buyer are doing: Ideally, you are listening and asking great questions that are informed by your unique insights and the prospective champion is selling themselves and dropping the prospective label. If possible, you want to promise to solve detailed objections later, though you may have handle some now in order to get permission to proceed. After listening to the champion you want to write down what you heard and present it back to get co-authorship.
The artifact and how to inspect it: The outcome of this stage is a co-authored deck that can be used with or without you to gain executive sponsorship. Even if you came in through a top down motion, your now-not-prospective champion will have to get permission from the relevant executive to proceed to a real buying process.
To get to this co-authored value deck, you write down everything you heard.
- Background – how the deal came to be, who is involved
- Discussion points – in the clients words what are we trying to do
- Vendor description – customized to say the relevant qualifications to this buyer
- Vendor Perspective & proof points – You chance to articulate how your unique proposition answers the concerns / discussion points of the buyer
- Next steps – Probably leave blank [Hmmm… I wonder if we could ask some questions that might allow the buyer to come up with next steps which are the next steps in this process?]
- Anything else cool you think your champion might want to share
These decks should not look like trash but they shouldn’t look too polished either. Companies usually don’t use designers for internal decks–we’re trying to make this look like the champion’s work even though we’re going to do as much of it as we can. Also, when you present to the champion the first time, you don’t want deck to be too correct. Close enough that the champion is going to vibe with it, but also off the mark enough that they will ask you to make a bunch of changes. These changes are critical the achievement of co-authorship.
At the end of the day if you have a deck, in the champion’s hands, where the champion is saying, “Yes, this represents what I think about your solution and we’ll go win internal allies, especially a sponsor,” then you have completed this stage. As always, depending on what blows your receive later you may have to come back to prior stage, but now you have a written artifact to fall back on and ask what changed or what is wrong to evaluate subsequent steps.
Stage 4: Sponsor -> Acknowledgement
It should be downhill from this stage, even if 2/3rds of the work still remains
Your champion needs top cover from the internal politics of the organization. You need to get it for them and get it in a way
What you and the buyer are doing: You are taking the co-authored deck to whomever sponsors this kind of purchase at an executive level.
The artifact and how to inspect it: This artifact is fuzzier than many of the others. The A+ version of this is an e-mail from the sponsor, which thanks you for co-presenting with your champion to the singular executive sponsor and promises to fire anyone who gets in the way of completion and implementation. That happens to me about 1-2% of the time.
The other 98%+ of the time, you as the seller need to help your champion navigate the internal politics. Can’t be at the sponsorship meeting? Help them prepare and write deliverables for them. The sponsorship entity is committee? You and the champion are meeting 1:1 with committee members in advance, handling objections outside the committee meeting, and counting votes. Executive sponsor bought-in during the meeting, but no follow-up? Then you are sending a thank you note confirming and thanking them for everything they said in the meeting. This essentially invites them to disagree with you, otherwise you can come back to them and ask for sponsor intervention if things get stuck later.
If your champion says you have sponsorship, but you have no written artifact confirming it, be very careful… you almost certainly do not. Your champion is probably confused not actively trying to deceive you. It would be useful to try to test your status with the champion’s permission with a thank you note to the executive sponsor.
Stage 5: Objections -> Implementation Plan
Getting complete clarity on both sides…
This stage is often incredibly frustrating for sales people. It kind of feels like the sale is made and you’re waiting to get a contract. I would encourage you to think of this differently, you’ve made the sale to some of the key stakeholders but not all of the stakeholders. This is the stage where you get total clarity on the deal. It is also the most customized by product and industry.
What you and the buyer are doing: At this point you have, executive sponsorship acknowledged in writing and champion who is armed with written materials that explain at a high level why your offering is great for the organization–and pointedly left out is how your solution will get your champion promoted. Now is the time where you have to get really clear on how this great initiative that you share with your champion will actually be a success. Depending on your product you will have different stakeholders and objectors. If you can anticipate what will happen at this stage, you can often overcome objectors by seeming really professional and having a canned–but also customizable — “implementation plan” or other package of deliverables for this stage.
The artifact and how to inspect it: I’m calling this document an implementation plan, but it might have a different name in your vertical. To give you an inductive flavor, here are some examples of the key points in some different verticals that I’ve sold in:
- In remote sensing data: This document contains a really complete specification of collection operations, data quality and definitions, an API integration plan/timeline, and a plan for commercial rollout of derivative products.
- In security automation: There is a small section on how procedures and staffing will change–honestly not much more than the ROI section of champion deck. Then there is a ton of information on a per building basis about which building systems the product will integrate with who the integrator(s) will be, how they will be managed, which teams and systems have which security certifications, and how all the systems will or will not talk to each other.
- In Electronics Design Software: There is huge emphasis on how the design and quality assurance process. There is probably a high level mapping of big changes enabled by automation–is the organization going to shift design work or reviews around in some major way– and then there is an almost feature by feature mapping of how will individual contributors accomplish specific designs that are of interest. Probably a few other things like integration, training, and support get covered.
- In Robotics and Vehicle Automation: The big emphasis is on the project plan: the requirements for staffing and delivery both on the technology provider and OEM side. Key things to cover are how the OEM team can take action on their own and what happens and who pays when inevitably the 3rd party hardware vendor fails to deliver on time.
One note here is that the ideal place to be here is to have explicit ROI, a strong plan with all details of implementation, and timeline to get through legal, close, and kickoff the project. Ideally, you will have quoted a rough order of magnitude price or some approximate formula, but still have a little wiggle room on implementation charges. Another thing to consider putting in here is also a change order and business review process. Very few complex deals with implementation services survive contact with reality perfectly, it is better to surface the idea that you’ll true up and adjust as needed and on a regular cadence.
Stage 6: Contracting -> Close
Now the sale is actually being completed!
This stage is exactly what you think it is… Though sometimes you can start its activities in parallel with the objections to implementation stage if you know that legal is going to be slow.
What you and the buyer are doing: If you are faced with an internal legal department, they have to prove that they are looking out for the company. My take is that they very rarely are in the sense that the cost in money and delay that they exact are rarely worth the contract “improvements” that they make. The implementation plan can do a lot to illustrate what the gain for the company is and the timeline on which legal review must take place is. This gives your champion a powerful tool to manage their own legal department. Ideally, you also have some room to raise the price during this period if timelines are shrinking or legal is getting nasty without blowing up your champion’s internal credibility. This further strengthens your champion’s hand to push for contract approval.
The artifact and how to inspect it: At base, this is a signed contract that you can live with according your own business and legal review. And congrats! If you got to the end here and got a signature, you’ve won a deal!!! Now the real work of delivery begins, but take a minute to celebrate.
Contact me for an example if you’re in robotics services, I have modular contract from TerrAvion that has been deployed elsewhere and even been arbitrated over.
robocosmist 