What are some of the key metrics and indicators of a healthy sales pipeline?

Using coverage and hit rate as key performance indicators (KPIs) for a healthy sales pipeline can be deceiving. The true success of a pipeline relies on well-identified and analyzed opportunities that align with your capacity to provide valuable solutions. Moreover, a successful pipeline should demonstrate a customer-centric, proactive approach centered around progress rather than mere outcomes. Based on my experience, a robust pipeline is often smaller in size, focusing on delivering optimal outcomes through a proactive strategy. In contrast, an unhealthy pipeline is characterized by an abundance of poorly analyzed opportunities, often stemming from an internally focused process.

Just make sure that there is no such thing as window dressing in pipeline management. 'Filling' the pipeline is not the answer. In my opinion, it is better to have a 'actual' pipeline. Rather with less opportunities, then filled with 'so called opportunities' to make quota.

A high velocity can indicate that a high proportion of the sales wins are transactional not strategic. For longer term sustainable growth strategic sales tend to be repeat business building longer term relationships with customers. It takes longer to win but delivers higher value and usually better margins.

Sales velocity offers valuable insights, yet it can also lead to misleading conclusions. There's a danger of prioritizing efficiency at the expense of effectiveness, potentially yielding worse results than focusing on the right strategies and actions. Balancing these factors is crucial for achieving optimal outcomes.

While conversion rate can be a useful KPI, it's essential to acknowledge its potential for misinterpretation. To enhance your hit rate, focusing on refining your selection criteria for investing time and resources into sales opportunities proves more effective. This is particularly crucial when dealing with primarily reactive opportunities. By intentionally deselecting ill-fitting opportunities, you not only gain more time for the right prospects, but also foster a smaller, well-curated pipeline that leads to improved outcomes and a higher conversion rate.

Centering your attention solely on sales cycle length might inadvertently encourage counterproductive behavior. Instead, directing your focus towards the broader picture, specifically the buying cycle length, is crucial. Prioritizing a customer-centric approach that facilitates the buying process ultimately leads to shorter sales cycles. By assisting buyers effectively, you not only align with their needs but also optimize your own sales process.

I remember how an old team member, one of my highest sales achievers, would bask in the glory of his large accounts. Courtesy which he was #1 month on month. End result, he never worked on the pipeline. One fine day, due to some issues at the client, the business flow stopped. And here we were, for no fault of ours, with zero sales. The team member's numbers collapsed and thats when he went into a scramble to generate leads. On the other hand, while every thing was hunky dory, thats when he should have started working on the pipeline rather than waiting for things to fall apart before starting work. End result, it took him 6 months of lost incentives to get back to that level

Emphasizing pipeline balance is crucial, particularly in cases of extended and intricate sales or buying cycles. In such scenarios, prioritizing progress within the pipeline rather than immediate outcomes becomes paramount. By maintaining a focus on progress, you establish a pipeline that can effectively sustain long-term growth despite the challenges of longer cycles.