Pipeline management for sales managers, avoiding delusions by focusing on pipeline activity movement

Pipeline management is the one best practice that links all sales team together.  Whether it be a hand-written list on a white board, or a custom dashboard in Insightsquared, every team knows they need to track the deals they are working on as they get closer to closing.  Every team has time set aside each month for sales managers to talk with sales people about what they are working on and what will close.  Along with these positive similarities, comes a negative one…. most of the companies can’t hit their results consistently.  Despite all their best efforts, their pipelines are still filled with hopes, dreams, and pipe-lies.

Why is it so bad?

The first reason is experience, just like in my post about scaling, experience is the bottleneck for better pipeline management. The more deals you’ve closed, the better you start to understand what good buying signs look. The more deals you’re involved in, the better you can sniff out a shopper that’s never going to buy.  As a sales leader, its hard to teach these instincts to new sales people, so you’ll have to think about what to do with their pipelines while they’re still learning (most likely


do you more regular reviews).

The second reason is usually a poor sales process. If each of the stages in the process are not 100% MECE , and crystal clear to sales people, then everyone will start to use them differently. If everyone on your sales team uses the stages differently, then its hard to draw conclusions about where you can improve, or even what techniques are succeeding.  This in turn cripples your ability to get accurate forecasting based on close rates per stage.

How can it be improved?

1) Opportunity Stage Design

  • In needs to be based on the real-life steps that it takes to close deals for your business. Make sure you’ve taken the time to interview experienced sales reps, and you’ve followed several deals start to finish to understand the progression.
  • Each stage needs to be clearly defined, and there can’t be any overlap (i.e. they need to be MECE).
  • It should be pretty obvious to everyone on the team, even before training kicks in.
  • Part of the definition needs to be an “entry” and “exit” action. Something that needs to happen in a deal for it to move to the next stage.
    • Ex. If you have a stage called “Pitched”, the action was that they received a sales pitch (for which you and your team need a definition).

2) Stages – what typically gets tracked, the funnel of the number of deals at each stage

  • this number doesn’t mean much in the short term, in fact it can be outright deceptive.
  • if you have 10 deals at the “decision maker identified” this week, and 10 deals in that stage next week, what does that mean?
    • nothing, it could be the same 10 deals, it could be 10 new deals…
  • pipeline snapshots can be useful, but I’ve always found them useful on a longer time horizon (quarterly).
    • they can help you understand conversion metrics for stages, so you can set benchmarks and identify who needs additional help.

3)Understanding Activities

  • Now that you have specific activities tied to each stage, I’d focus more on measuring than the overall pipeline.
    • To make things easier, I’ll call it Pipeline Movement Activity or PMA .
  • On a weekly basis, it matters more how many activities you took to move deals forward in your pipeline (i.e. the forward progress).
  • While the number of deals in each stage can be deceptive, the number of “pipeline activities” is a much better measure of the progress.
  • Once you know your targets and your “sales math”, you can back into how many of each activity you need at each stage to hit your targets.
  • For front line sales managers, a weekly view into these activities will be the easiest way to make sure everyone is pacing.

Example Pipeline + Metrics

Stages (just made these up):

  1. Lead Identified
  2. Lead Qualified
  3. Decision Maker Identified
  4. Decision Maker Engaged
  5. First Presentation Complete
  6. Detailed Presentation Complete
  7. Contract Negotiation
  8. Contract Agreed
  9. Closed

Pipeline Movement Activity (PMA):  these are your entry and exit actions

  1. A sales person created a new lead in the CRM
  2. A sales person qualified this lead according to your team’s definition
  3. A sales person identified the Decision maker through calls or through research
  4. A sales person spoke to the Decision maker, explained what you do, and asked to set a first presentation
  5. The first sales presentation is complete ( you need to define what a full pitch is, usually it involves covering all the details including price)
  6. The sales person went back and gave a complete second presentation (typically more objection handling, more due diligence)
  7. The client has been sent the contract
  8. The contract has been signed
  9. Payment received

Notice how everything is in the past, this means that we’re measuring work COMPLETED… it’s not an aspirational measure of what might get done in the future.  With this fictitious example. lets look at a tradition funnel.  Here’s a list of each stage and how many different opportunities are in each stage:






Based on these numbers above, which week was a better week?  The look pretty similar, though some stages are better in week 3.  To draw more insights from this pipeline view, you’d really need to see how many of these are new each week, and how many are just stale deals from the previous week.






How about now?  Looking at the same week, but focusing on the actual activities completed, which week was a better week?

Week 3.  In Week 3 the sales person made more progress at most of the stages in the pipeline.  By looking at the activity itself vs the stages, a clearer picture emerges.



So there you have it, focus on Activity, measure the work that got done to create forward movement in your pipeline.  Using the structure above, it’ll be more obvious when you’ve had a good week vs a bad week.  On the flip side, don’t completely ignore your funnel, just have patience and use it for long(er) term learnings about conversion rates.   But for short term progress, its all about pipeline movement activity.