How to fix a broken CRM pipeline

For a company’s executive management and all members of the sales team, a CRM system proves its value by improving the quality of the sales pipeline and the efficiency of closing those deals. Sure, a CRM’s contact and account information are valuable to management — but those pale in comparison to the value of deals that will (or won’t) make the quarter. If a CRM system helps win just one more deal every quarter, it more than pays for itself.

Unfortunately, too many sales pipelines are just baloney: wishful thinking about deals that will never close (or, worse, that don’t exist at all). There’s also the opposite problem: Big deals that may well close, but don’t show up in the system at all until they do. These “miracle” deals are never harmless surprises, and can be downright dangerous if you have a long supply chain.

The good news is that there are several metrics you can use to validate the pipeline health. But simple numbers need to be supplemented by policies, automation, and business processes that provide incentives for good behavior. Let’s look at some examples of policies that should be in place:

This is really basic, but many companies still have some deals that aren’t in the CRM pipeline, and some others that are pretty badly misrepresented. To keep things consistent, it’s best to create synthetic deals that represent all the corner cases (such as “run rate” business, distributor/reseller deals, renewals, etc.). Make sure that these deals are clearly distinguished from standard ones using record types or other flags that prevent confusion in reporting and other business processes.

This will require some fuzzy logic, but makes sure that you’re not double or even triple-counting deals in the pipeline.

[Related: 6 CRM predictions for 2016]

Again, basic … and way too often violated. The key is the enforcement of the word “realistic,” using criteria such as the following:

It’s best that these criteria be checked automatically, although that can involve some fairly complex code.

For example, two weeks after the end of a quarter, all deals that were supposed to have closed at the end of the quarter but haven’t been updated by the rep are automatically closed out. If you want to be ornery, make it so they can’t be re-opened. But don’t take it too far, as this kind of thing can become an engraved invitation for reps to game the system (e.g., automation that re-assigns in-progress deals to another rep if they haven’t been updated in 30 days).

“Audit trails” means a date/time stamp, user ID, and before vs after values for every single change (i.e., this is not a weekly snapshot). Keep these audit trails for at least three years, just like the rest of your CRM data. This is for your own protection when the lawyers come a-callin’, so just do it.

[Related: What CRM data tells you about your sales methodology]

Even if you are using some sort of external forecasting tool, all the data it uses should be coming from the CRM system.

Bogousity means any of these things:

…upon deals satisfying the pipeline criteria of the first bullet and the “anti-gaming” criteria described throughout.

Every level of management needs to explicitly reward good pipeline and forecasting behavior, while visibly highlighting sloppiness and sloth. With a sales organization of any size, the culture of accurate forecasting is a key success factor and a bad culture is a nexus of failure. Unfortunately, getting this right requires consistency, patience, and time -- things that many managements aren’t very good at.


David Taber

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