The Two Critical Questions your Territory Plan Must Answer

Earlier in my career, I worked for a large National Retailer. It was my responsibility to manage inventories, forecasts and ensure that the right products were in the right place (the store) exactly when the customer wanted to make a purchase. In order to do this, I balanced data such as: costs of inventories, what I knew about the forecasts, sales trend data, supply chain lead times and promotions. Sometimes I’d even look into things like weather data or sales of complementary goods (i.e. a ‘market basket’) to ensure I was managing my inventories and assortments effectively. The best thing about that job was at 8:00am Monday morning – I always knew exactly how I was doing! Sales and Inventory reports were delivered to my desk and with a highlighter pen in hand, I devoured the report. What was selling on plan? Where did I run out of inventory over the weekend? What tweeks needed to happen in my inventory balances to execute properly for the week ahead? This constant clarity of feedback helped fuel continuous improvement. Enterprise Software sales is different. Sales cycles can be measured in months (or years!) and interim feedback can often be spurious (ever hear the term, ‘all buyers are liars’? Maybe it’s unfair to say ‘all’ – but human nature dictates that your customer may not want to deliver bad news). So without a “Monday Morning” scorecard, how do you know if you’re moving in the right direction for success? The answer of course is your Territory Plan.

The Fundamentals of your Territory Plan

I’m not going to review the details of how to construct a territory plan, because there are already some fine discussions of that on the web (Look here, or here if you’re interested for two examples). At a high level the process involves reviewing your target prospects, refining that list to the ‘most likely to purchase from you’, understanding exactly why these customers need the product you’re selling and finally creating an action plan to communicate with and educate the prospect, leading them towards a purchase. Of course all plans are ‘made to be broken’ and a talented Sales person will be able to adapt the plan on the fly as necessary to take advantage of opportunities as they arise, but the idea is to reduce variability or the need for ‘luck’ as much as possible. A Territory Plan will answer the following two questions:

1.Where is the money coming from?

This is the first and most important question. You can’t answer this question unless you KNOW your territory, you understand your prospective customers and you are clear on what you have a realistic chance of selling. New products are harder to forecast than established products and new territories are harder than mature, established ones. Answering the question of “Who is Likely to Buy?” – is very different from “Who could benefit?” and you can’t confuse them. Also, don’t ignore any part of your business. Some revenues will come from new customers, some from existing customers (one company I was with encouraged us to review all old contracts to identify ‘incremental license’ opportunities where the customer might have expanded use over time). This becomes your ‘opportunity pipeline’. The exact plan for what deals need to happen to hit your targets.

There’s much debate about how much the pipeline needs to have in order to ensure sales targets are met. Some ‘traditionalists’ like the 3:1 ratio… but your company will know better that your specific pipeline needs to be to ensure quotas. The practical reality is, there are many variables including: How well qualified are opportunities? (No point having millions of poorly qualified opportunities wasting time) What unique circumstances improve your competitiveness in the market? How is the landscape changing and how can you benefit from those changes?

The list of qualified opportunities is your list of exactly where the sales are anticipated to happen. This list is updated constantly, in real time and therefore your Territory Plan needs to be constantly updated and reviewed.

2.How should I be spending my time?

Time is the one constant for each of us on this planet. We all have exactly the same amount of time in a day. The only difference, is how we choose to spend that time. At a high level, there are four basic activities you should be involved in: (1) Building Pipe, (2) Developing Opportunities, (3) Closing, and (4) Personal Development. The trick is that not every activity should get the same amount of time – in fact, different situations require different time allocations. The end goal is to have a Sales Funnel that moves prospects through from New Lead, to Happy Customer in a predictable pattern – so none of those activities can be ignored.

With ‘time’ as your resource, you are spending it to move prospects along the sales funnel. This progress along the milestones toward closing is how you can measure your progress incrementally – like that weekly report I mentioned earlier. Identify the bottlenecks, and you will identify opportunities for personal development and opportunities to creatively solve problems.

It’s no surprise that when you boil down the answer to the question posed above – it comes right down to PLANNING (Where is the money coming from?”) and EXECUTION (“How will I spend my time?”).

Everything comes down to those two things. You can’t control your buyers’ decisions and you can’t control the market – but you can have a plan and execute against it flawlessly.

-Lorne Campbell 2018.