As industry grew in the United States, sales became an integral element of business success. It wasn’t long before a science was developed to help define the foundation of the process. This is formally known as sales process engineering and is intended to design better ways of selling a product or service.
The more refined the sales process becomes, the easier it is for people to sell and the more successful a corporation will be. Anything that is involved in the sales process is intended to make the job of the salesperson easier and thus create a more productive team.
The primary areas of application for sales processes span beyond just the department of sales and can also affect marketing and project management. One of these functions includes a system known as “sales funnel engineering” or “sales pipeline engineering”.
What is a Sales Pipeline?
A proper business pipeline definition would not be the simple feeding of leads into a funnel. The sales department must work closely in conjunction with marketing and project management to see the entire process through. When it comes to asking, “what is a sales pipeline?” it’s best to understand it is a means of visualizing the process.
The sales pipeline represents the visual step-by-step process of modern sales. It describes each stage of the procedure and how to get to the next part of the sale. Every company has a slightly different way of describing their pipeline/funnel, but the following are the main components of a successful pipeline:
- Lead Generation: Any steps taken to gain qualified prospects and people interested in your service/product. Consumers can often do their own research so this step may take little effort from sales.
- Lead Qualification: Customers are engaged and send the sales team their data through an online form or other type of contact. This is the question-asking phase.
- Needs Assessment: Here the sales department should be engaging the customer and offering them a value proposition after assessing their specific needs. The more customized the better.
- Proposal: A specific offer is presented to the buyer and a sale is set up to close. Near-term opportunity is determined and lead scoring can begin.
- Close: This is when the deal is finalized and the lead becomes a customer.
Each sales stage has a set of actions that must be completed before you can move on to the next phase. The pipeline should neatly display all of your opportunities according to their phase in the sales cycle.
How to use a Sales Pipeline
Sales process engineering wouldn’t be a process without a plan on how to use it. Although every sales department has their own method to their magic, the following is one way to successfully utilize the sales pipeline:
- Find and identify leads
- Determine their potential
- Identify decision makers and key influencers
- Measure and analyze metrics
- Apply lessons to future sales
The idea of breaking down the act of selling something into a procedure is what makes it more of a science than a gamble. Sales no longer has to be quite the guessing game it once was. When applying sales process engineering properly with a sales pipeline, the whole progression can be tweaked along the way for the best possible outcomes.
Project Management and Pipelines
The entire reason why it is important for a project manager to understand a business pipeline definition is because they play an integral role in the process. Only 16% of sales managers list optimizing forecast accuracy as a priority but project management understands that planning is a major part of the method. In fact, the basis of sales pipeline management is to estimate the upcoming sales you are aiming to close. This can only be done by working closely with project managers to assess how many projects will end in the quarter.
The inability to predict customer metrics when sales is working alone can leave a project manager overstaffed on a project or worse, under-resourced. It is critical that these two departments work closely in sales engineering to predict the outcome of a project.
One of the most efficient ways to meld project management with sales is through a shared customer relationship management system (CRM). Having a database that is accessible to the entire company will allow a level of transparency that will help to efficiently move projects and sales along the pipeline. The sales team can use the customer data collected by project managers to further their efforts and project management can, in turn, use sales metrics to manage their resources and labor costs.
As technology marries into the business space, departments within an organization are seeing more clearly just how they can work together. Ultimately, sales drive the revenue of the company and every employee’s goal should be to create an environment where the company can sell as much as possible. Through successful sales process engineering and an organized pipeline, project management and sales can work together to best facilitate the process and create an atmosphere of opportunity.