Using the Win/Loss Analysis

22 Nov 2005

The success rate for closing major new proposals is typically less than 20% when several suppliers are asked to present. Companies often spend large sums in an effort to win business, but those whose bids failed seldom get any feedback as to why a competitor was a better fit. As a result, the chances of winning the next major opportunity stay roughly the same.

Research data from supplier selection teams offers surprisingly simple fixes that losing competitors could use to improve their success rates, yet relatively few sales forces consistently gather information about their losses and set up legitimate benchmarking, tracking and management of their proposal and presentation process.

For example, the proposal team at a major software integrator lost a huge piece of business because it wrongly assumed that the customer was completely satisfied and offered the same "strong support process" it had touted previously. Had the proposal team been aware that the customer was unhappy with its customer support, a different tactic could have been used and the business saved.

To further complicate the challenges sellers face, customers' expectation levels have risen dramatically. Today, 80% of customers who leave their previous supplier rate that supplier as 'good', but it seems that good is no longer good enough.

What is consistent among sales forces that achieve close rates above 40%? They commit to accessing objective, quantitative and independently collected measures and analyses of the reasons for wins, and especially losses, compared to their competitors, and maintain active control of their own success rates by debriefing all proposal team members with the results of each win/loss analysis. They develop new techniques to address the two to four most serious deficiencies that affect success, and reward salespeople for their rate of improvement rather than a single win or failure.

So why don't all sellers track, analyse, and change techniques to increase their wins? It could be defensive resistance — members of the sales force may fear having someone look over their shoulders or interfering with their relationship with a prospect or customer. Sometimes they don't believe prospects will give them in-depth, candid information, especially about competitors, or things are going well and they don't have the time, or perhaps things are going poorly and they can't afford it.

If your sales force is not beating the averages in winning major opportunities, then it is time to consider applying the same database-driven Total Quality Management (TQM) techniques used in other aspects of business.

Skilled executive-level interviews, done professionally and scheduled at the convenience of the prospect or customer team who made the decision, are not only respected but often appreciated.