Arbitrarily managing toward a 3x Pipeline Coverage Ratio is DUMB!

Arbitrarily managing toward a 3x Pipeline Coverage Ratio is DUMB!

Some sales processes and methodologies were rooted in best practices, but they start to show their age over time.

  • BANT Qualification
  • F.A.B. Cold Call / Emails (Feature, Advantage, Benefit)


3x Pipeline Coverage. It’s become subjective, not objectively aligned to your volumes, velocity, and conversion cycles.

Here are the three topics this week:

1. Arbitrarily managing toward a 3x Pipeline Coverage Ratio is DUMB!

2. 2 Findings in your CRM that will motivate you to push your AE’s off their status quo.

3. Building a sales cadence? Learn to Storyboard first.

Arbitrarily managing toward a 3x Pipeline Coverage Ratio is DUMB!

It’s dumb because many sales leaders don’t know or understand the origin of that modeling:

3x Pipeline Coverage assumes you close & win 33% of every Sales Qualified Lead. It doesn’t account for:

  1. The Source. (most companies have different deal conversions by Source. Ie. Customer Referrals close at 45%, whereas ‘Self-Sourced Outbound deals might convert at 10%.
  1. The Velocity. This assumes a Caribbean-like constant wind of leads. Do you have ebbs & flows that are seasonal?
  1. The Market. Your SMB, Mid-Market, Majors, and Enterprise all have varying deal conversions. Same with geographic markets.

Winning By Design just finished a study of their customers, and here is what they found:

“We’ve seen recent evidence of steeply declining win rates across regions, sectors, and markets. For example, win rates for an ACV of $100,000+ and an

ACV of $20,000 has fallen below 20% and 17%, respectively. Sellers are reporting a more complex decision process, delaying the sales cycle, and more deals are lost to indecision. To counter this, sellers are increasing

discounts, which can negatively impact win rates and the sales cycle even more. As a result, companies need to re-adjust budgets and forecasts, causing

uncertainty at the board level. This economic situation is not expected to improve until late summer, and the effects are anticipated to worsen, along with an increase in churn over the next 60 days.”

So the image you run a diagnostic and identify your deal conversion (win rates) is 17%

17% = approx. 1:6 ratio. Meaning you need 6x Pipeline Coverage with all things being equal.

Time for you to run a diagnostic check!

2 Findings in your CRM that will motivate you to push your AE’s off their status quo.

A study done by Clari on sales pipeline conversion has uncovered some scary relics:

Finding #1 – 87% of opportunities placed “In Commit” with < 60 days Close Dates have <1 Contact per Account.

  • 51% only have 1 contact
  • 36% have 0 contacts

The bigger the CRM (greater than 100,000 records) the more it goes off the rails. Your database is correlated to future enterprise value (in an M&A transaction) and it would fail due diligence HARD!

Finding #2 – 73% of opportunities with < 60 days Close Dates have 0% email communication flow in the last 30 days.

Wow! That means every deal better be deep in the bowels of legal and procurement review. How can there be no weekly work back schedule meetings?  

HOPE AND PRAY is the core strategy here.  As a sales leader, how do you forecast against this kind of risk?

Now you can argue that people aren’t logging this information into their CRM… but that was an excuse in 2012 when email-to-CRM syncs weren’t commonplace. Every CRM now has auto-sync.  

The real problem is at the actions & activities levels.

There are no:

  • Workback schedules with the prospect
  • Accountability check-ins
  • TAM Mapping / Buying Committee building
  • Pipeline Coverage nurturing campaigns.

No wonder SQL-to-Close ratios are falling below 20%.

Building a sales cadence? Learn to Storyboard first.

When you watch a movie, do you think Quinten Tarantino builds a scene by:

  1. Wireframing and storyboarding the story from Point A to Point B


  1. Writes 100 words in the middle of a screen between 2 characters with no context.

Of course, starting with a wireframe/storyboarding process.

Sellers don’t realize that we are storytellers as well.

Here are 5 storyboarded “Sales Play” that we’ve leveraged, and help you understand how to design a storyboarded sales play in advance: 

Sales Play #1 – Customers on the Move.  

This one should be obvious for Pipeline Signals and our customers. You’re 3-5x more likely to open this door. Engage a story about your past successes together and how it applies to their new company.

Sales Play #2 – Benchmarking Company A vs. Competition.

When I’ve seen this done right, it’s gold. We once (and will be doing it again) mapped the % of sellers in 50 accounts that shared content on LinkedIn and their social presence. What do you think the bottom quartile did when they saw this report? They booked meetings with us.

Sales Play #3 – Pontificate the future.

Is something emerging (like AI) in your industry? Help prospects see around the corner and derive a FOMO for not meeting you. They could be missing out on excellent insights. In our industry, when a new sales tool, methodology, or social selling feature would come out, we would make a video teasing the concept… leaving the prospect wanting more.

Sales Play #4 – Roadmap to success.

Sometimes a prospect just can’t see past the tip of their nose. Help them visualize what success could look like 90, 180, or 365 days into the future. Help them see the destination, and that the hike up the mountain is worth it. We’ve done this by showcasing certification videos from our SPEAR Selling training program.  The sales leaders can see AE after AE booking meetings at scale.

Sales Play #5 – Be a Maven / Connector.

Sometimes you just have to play the Laws of Reciprocity. Give them something personal that can help their career. I’ve done this by highlighting a job opportunity, speaking opportunity, and inviting them on a webinar… something to help their career.

FREE RESOURCE – Self-Generated Quota Gap & Activity Tracker.

Are your AE’s struggling to meet sales quota?

They could have a QUOTA GAP.

Do they know what percentage of their sales quota THEY NEED TO SELF-SOURCE? (not driven inbound from marketing or the channel)?

For many companies, this is shocking. This could be 50%, 75%, or even 90% of every AE’s sales quota.

Download it here.

Ensure your sales team has a clear understanding of where they need to focus their efforts.

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Free Resource:
Self-Generated Quota Gap & Activity Tracker

Do your Account Executives (AE’s) need more leads than Marketing can provide?

Do your Account Executives have a sales quota that’s larger than your current Inbound Marketing lead flow?

Each AE needs to understand their “Self-Generated Quota Gap” – the percentage of quota THEY ARE RESPONSIBLE FOR not covered from inbound sources. They have to create this sales pipeline themselves.

Download Free Resources

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