Selling: An opportunity pipeline won’t help you grow your business

“I cant chase all these opportunities, I don’t have the resources!”. How many times have you said, thought or heard this? Invariably what happens?...we chase the big sexy ones, which if you succeed will be great. But how often does this really work out you way you hoped?

The other extreme we hear is…”I’ll only chase the work I know I can deliver!” This may be very pragmatic, but is unlikely that you will grow any faster this way.

The question we are asking here is “Are you looking at this from a business growth standpoint?”.

It’s tempting to chase those big opportunities, but you also need to pay the bills in the meantime. This is where the mental image of a pipeline gets in the way.  A flow of opportunities is not enough, you need a portfolio. Of course a pipeline supporter will say you can segment your pipeline, which is true, and you may separate countries or products, but do you really segment by balanced business needs?. Take a pipeline and try explaining to your management why you are not targeting the top 5 revenue earning opportunities…Good luck getting resources to chase anything but those.

All too often, the selection criteria are dominated by revenue potential, market share, and technical fit. In turn these will always favour the big juicy opportunities.

If you work for a multinational with deep pockets and a healthy revenue stream this approach can work..for a while. If you are trying to grow a smaller company without the benefit of those deep pockets, you need to take a more commercially astute approach to select the opportunities to grow your business smartly.

So why will a portfolio serve you better?

Firstly, by inference a portfolio is made up of complementary elements, be they opportunities, stocks and shares or whatever, so already you are creating a different mindset by referring to a portfolio. It should therefore contain large and small, fast and slow sales cycles. Easy to win, and more challenging, opportunities that will solidify your critical mass, and other that will help you achieve your longer term goals, and will stretch you.

Importantly, growing existing contracts must be given even consideration to winning new work. When was the last time you saw an existing contract at the top of your opportunity pipeline ranking?

Secondly, taking a portfolio approach gives you the freedom to look at your options from many different angles. You no longer have to separate good from bad, but instead compare opportunities against each other to come up with a good balance that will reflect your needs.

Lets pause and think of an example. Company A has secured 2 big contracts that will take time to mobilise and will need a lot of engineering time to deliver. So what are you going to do in the meantime, stop chasing work and send your sales team on vacation?, or think portfolio?

What work will be complementary?..maybe there are some shorter term, but easier contracts to win that will bring in revenue whilst your big contracts are gearing up?. What you don’t need is to chase another mega tender that you cannot deliver.

We have developed the Mbrace Opportunity Portfolio workbook to help you implement and assess your portfolio approach to opportunity assessment. Using a simple questionnaire covering topics such as the market, competitors, your relationship with your customers, and much more, we generate a series of charts that help you evaluate which opportunity mix works best for you depending upon your commercial strategy at the time.

If you have embarked upon a strategy to aggressively increase your market share in a location, the opportunities that will help you achieve this will be different to those that may help you grow a profitable but more consistent business. Importantly, the opportunities themselves do not change, but the way you evaluate them using the workbook does.

Once completed you have a series of visualisations looking at various commercial factors such as differentiation, time to cash, ease of winning or relationships leverage. Importantly, there are no good or bad opportunities, simply some that are a better commercial fit for you at that moment in time.

The third benefit of taking this approach over a pipeline is that you may have an otherwise very attractive opportunity but for one or two key areas. Maybe you have poor relations with a key person, or your technology is not the preferred one. Rather than dismissing this opportunity, this tool helps you to identify what you need to do to improve your competitivity, take actions to redress key commercial weaknesses, and therefore increase your chances of success.

So, capture your opportunities, but don’t select which ones to pursue using a pipeline, think Portfolio instead!