article | October 18, 2013
How The Best Sales VPs Manage Opportunities
Rule of thumb is a VP should spend 25%-40% of their time on prospect calls. Most VPs fall within this range. However there is a key difference between the World Class and Average VPs: WHERE they spend their time.
Download the Sales VP Allocation Time Tracker and Sales Stage Checklist. Identify where you are spending your time. Then execute the stage activities you need to win.
Average VPs predominantly engage in late stage deals. The typical sales VP looks at late-stage opportunities. They can’t let one opportunity slip, regardless of its importance. They want to be in every negotiation meeting and contract signing. This is the Sales VP Super Closer role. It is a flawed approach. Below is an example of a Super Closer VP’s time allocation by sales stage:
Here is why this approach doesn’t work.
1) No Credibility: The customer just sees another suit fly in at the end of the deal. Here are the thoughts running through his head:
a) “What value is this guy with a Rolex going to add?
b) “Does he not trust the rep?”
c) “Does he know anything about me or my company?”
2) Bad Behavior: This occurs when a VP is trying to push the customer to close. The rep may have done a fantastic job throughout the process. However, the VP views it as his job to “get the deal done”. This means throwing out a discount the rep couldn’t offer. Super Closer indeed. By closing all the deals, the VP justifies his existence. Meanwhile, he is reducing the average sales price on every closing.
3) The Third Month Traffic Jam: At the end of the quarter, the VP can’t close every opportunity. Now the Reps who depended on the VP are flying solo. The ones accustomed to the VP swooping in to “save the deal” are in trouble. Meanwhile, the VP is frantically chasing deals all month. They don’t have enough time.
Now let’s see how the “A” VPs allocate their time:
World Class VPs only engage the opportunities that will make or break their quarter. The best look at all the deals in their pipeline. Then they hone in on those crucial to the number. They are present on these throughout the entire sales cycle. Below is a chart showing the average time an “A” VP spends by stage:
Here is why this approach works:
1) The Customer Feels Important: The VP of Sales engages early and often. This shows the company’s commitment to their prospect. Any issues or dilimmas are handled early and promptly.
2) The Rep Gives It His Best Effort: Sales Reps want to look good in front of their boss. I’s get dotted and T’s get crossed. Nothing falls through the cracks. In turn the VP adds insight and value based on experience with other Key Account opportunities. They coach the sales rep on best practices for other opportunities. The VPs presence ensures near perfect execution.
3) The Urge to Negotiate Is Reduced: The Average VP comes in to close on price. The World Class VP differentiates his offering early. He eases the customer’s concerns throughout the process. Through the quality of interactions, the product and company is viewed uniquely. Price will always be an issue, but it won’t be the main one.
Another finding: the World Class VP doesn’t allocate their time evenly throughout the quarter. During the first two months, most of her time is spent developing opportunities. The final month, her time chart looks very similar to an average VP. This is because she is closing out key deals for the quarter. Below is the monthly breakdown:
The VP isn’t running down late stage deals all quarter. But when it’s time to accelerate, they are perfectly positioned.
Which deals are you spending your time on? Download our VP of Sales Allocation Time Tracker and Sales Stage Checklist. You’ll identify where you need to spend your time. You’ll also get a checklist to ensure you’re completing the correct activities.
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