Use The "Consequence Management" Business Practice To Close More Sales

by Paul DiModica

During the late part of the 1800s, an Italian businessperson, economist, and botanist named Vilfredo Pareto discovered a consistent operating model still used today.

His theorem was that 80% of the world's wealth and land was controlled by 20% of the world's population. This theory, originally called the "Pareto Principle," is now known as the 80/20 Principle.

The 80/20 Principle, although over 100 years old, is often experienced and discussed by many sales team members and management as they attempt to manage their sales process.

Six "80/20" Occurrences Common in Sales

1. Are 80% of your sales coming from 20% of your sales forecast?
   
   
2. Are 20% of your client meetings generating 80% of your qualified sales proposals?
   
   
3. Are 80% of your outbound cold calls made to the same 20% of your prospects?
   
   
4. Will 80% of your sales quota be hit with 20% of your customers?
   
   
5. When meeting with prospects, do you speak 20% of time and listen 80% of the time, or vice versa?
   
   
6. Is 80% of your time spent responding in detail to 20% of the questions your prospects ask?

Thus, using the 80/20 Principle as a basis to manage your sales prospect list can have an effect on your productivity.

• Is the 80/20 principle the best way to sell more?
  
  
• Would your rather sell more than 20% of your prospects?

The key to managing your sales efforts and the 80/20 Principle's effect on your daily productivity is to use a business process called "consequence management."

As salespeople, everything we do and don't do has a sales cycle consequence.

Consequence management is a business method for salespeople to track and adjust their sales success to hit their sales quota faster based on managing those business variables (or "consequences") which affect their daily sales cycle productivity.

Simultaneously, it allows us to maximize our sales success to more than 20% with our prospect base, thereby decreasing the effect found in the 80/20 Principle.

To manage consequence issues, you must make a business decision to focus on those variables that increase your sales success (or your sales team's success) instead of those variables that distract from it.

What are the business consequences that are currently affecting your ability to find qualified prospects, present your offering, communicate your business value and close deals?

To determine this, there are three questions you must answer in order to increase your sales success where you have a greater range of sales opportunities.

1. Why do prospects buy from you?
   
   
2. Why do you lose business?
   
   
3. How do you find prospects?

These questions seem basic, but their answers address the foundation of how to enlarge your sales opportunities so that you can sell more than 20% of your targeted prospects.

Most firms today DO NOT have a written sales process or know the answers to the questions above. They usually guess at Questions 1 and 2 (without substantiated research) and leave Question 3 up to the salespeople to manage.

After you understand the answers to these three questions, you can then focus your productive time on minimizing the 80/20 imbalance and increase your sales efficiency by selling MORE prospects.

Don't let the 80/20 rule manage your sales activities.

Instead, analyze the answers to these three questions and then develop a written sales process that allows you to sell more to your prospects while eliminating the sales impediments you must deal with on a daily basis.

Spend more time selling 80% of your sales prospect base, but understand why they buy and why you lose business.

Writers Resource Box