The Evolution of Telephony And Why Deals Take Forever to Close

I run a seminar that presents a wholly different (and quite effective) paradigm for how sales professionals should manage their time.

Tangent #1 - As luck should have it, this is the subject for an upcoming web seminar on July 10th presented in conjunction with our partner ReadyTalk.com

Tangent #2 - If you are a Webex customer you need to 1) find out your contract expiration date 2) cancel the contract as soon as possible and 3) sign up with Readytalk.com Their service is absolutely the best and most user-friendly web and audio conferencing service out there AND they are one of the coolest companies I know.

But I digress as this post is neither about web conferencing nor about time management. I reference the time management seminar simply because, during the course of this session, I use the evolution of telephony as an allegory for how we should think about efficiency of work over time.

The other day I was speaking with the CEO of a fairly well known technology company whose primary frustration is the unpredictable and inconsistent nature of his sales team. Now of course CEOs don’t talk in fancy terms like ‘predicable and inconsistent nature of blah-blah-blah.’ Instead, they say things like: “[Expletive]-it…why is it that my [expletive, expletive] VP can’t give me a straight answer on whether or not this quarter is on track? Half the time, he says things are fine and we end up getting our [expletive] handed to us. The other half of the time this [expletive] tells me to prepare for the worst and we [expletive] hit it out of the park.”

What frustrates CEOs is being surprised. In general, they hate not knowing and despise buying into a vision of reality that never happens. As such, they are constantly in search of greater consistency and predictability as far as sales is concerned. Unfortunately, at the level of an individual opportunity (deal) this is an unattainable goal because it is impossible to exert any real control. To suggest otherwise is like saying you can make the roulette wheel land on a number simply by willing it to be so. There are simply too many variables (in gambling and sales) for this to be possible. You must play the odds and probabilities are only meaningful with sufficient throughput.

The purpose of a sales process and the pipeline is to drive towards consistency and predictability of revenue generation in aggregate. We go so far as to say: “You can’t control which deals you win…only how much time you spend losing a deal.” This brings us back to the role of time in the sales process.

In truth, the largest and most complex of all opportunities cannot take more than seven days of work to win or lose. Of course I am generalizing but bear with me. The challenge is that these seven days are usually comprised of 1-2 hour blocks spread over the course of 12-18 months! The whole concept of ‘shortening the sales cycle’ is based on the premise that it is possible to compress this finite amount of work into a more attractive period of time. By and large, this is possible…up to a point. Lets agree that most sales cycles take too long. At the same time let us also agree that there is a finite limit as to how much we can compress this window. Getting 7 days of work done in 4 months instead of 12 months is a good thing. However, we are unlikely to compress this interval further because our sales cycle will always depend on the prospects buying process. So what the [expletive] does this have to do with the history of telephony?

Some of you may remember that when people first started making phone calls, conversations were carried on wires dedicated to a single conversation between a set of callers. An operator was required to physically connect the two parties at the switchboard.

At some point, it was noted that conversations contained a lot of silence or space. During the course of a conversation, pauses represented a huge waste of space if you added them all up. And from a transmission standpoint, a single conversation did not represent a highly consumptive use of a single copper wire. What would happen – it was pondered – if you could take advantage of the fact that conversations included lots of wasted space and the inherent capacity of the transmission facility could accommodate more than one conversation at a time?

To make a long story short, this was the starting point for the technology that now allows thousands of conversations to travel across a single fiber optic strand.

Here are the take aways:

1) Every sales cycle represent a finite amount of effort that – for better or worse – ends up getting spread out over a period of time that cannot be compressed past a certain point. Ergo - every opportunity represents a lot of wasted space.

2) Predictability and consistency of revenue generation requires lots opportunities in order to be statistically possible yet salespeople tend to fixate on a few opportunities that they want (or need) to close.

3) Success in sales ultimately rests on the degree to which salespeople master this wasted space and manage their actual selling time to drive greater throughput (more conversations) within a finite amount of personal bandwidth.