The Right Way to Shorten Sales Cycles

Everyone wants shorter sales cycles but the ways that early-stage SaaS companies try to shorten them often miss the mark. In this article, I’ll cover some practical steps that can speed deals along.

The main idea is that shortening sales cycles isn’t just about the sales team: Other departments have to pitch in and the company has to make tradeoffs. The CEO plays a critical role in fostering that collaboration and in mandating the necessary tradeoffs.

The Problem

It’s no surprise that companies want to shorten sales cycles, which are the time that it takes to close a deal after an opportunity is created. The longer your sales cycle, the further ahead you have to make investments in lead generation and sales hiring before you see a return.

Imagine a company with a six month sales cycle and bear in mind that it typically takes 1.5 sales cycles for a rep to ramp and reach full productivity.

That company would have to hire nine months ahead of when it wanted revenue and generate leads six months ahead of time. That’s a long time to wait for results.

Teams that try to shorten sales cycles typically begin by putting a laser focus on the sales team. That’s useful: Sales has important tools to shorten sales cycles.

But companies that just put more and more pressure on the sales team are missing opportunities to address the deeper causes of long sales cycles.

The Solution

A better response looks at shortening sales cycles as a whole-company effort:

Sales needs to build a process that proves value to prospects and that adds value for them as they participate in it. Sales also needs to actively manage the buyer's evaluation process.
Product needs to build a product that’s easy to buy, not just one with whizzy features.
Legal and security teams need to get involved in deals early and focus on real risks not hypothetical ones.

Creating this whole-company effort requires active involvement by the CEO. The company has to allocate the right resources and some departments will have to compromise on what they feel are their core objectives.

Some CEOs prefer to take a hands off approach. They expect their executives to embrace “first team thinking” and figure out for themselves how to collaborate in the interests of the company.

That’s a good ideal to strive for but it can break down in practice. It’s easiest to put the team first if you have strong relationships within the team. But many execs at early-stage companies are recent arrivals who haven’t had time to develop trust with one another.

Execs also know that their positions are insecure. Executive tenures at early-stage companies are typically short and some execs end up with much better outcomes than others. If the sales team doesn't hit its goals but the product team ships the features it committed to, there’s a good chance that the sales leader will be out the door but the head of product will stay aboard.

Under those circumstances, it’s a gamble to expect that execs will be willing to do things that make it harder to achieve their team’s goals. Imagine that the head of sales comes to the head of product and asks him to build a feature that would shorten sales cycles but isn’t on the product team’s OKRs. The head of product is likely to decide that his contribution to the company is to achieve his OKRs and avoid anything that distracts from that.

The answer will probably be “no.”

Coupled with this, the sales leader – who most directly owns the problem of sales cycles – typically has the least social capital. Companies start by building products and only later scale their sales teams. That means that the sales leader is the often most recent addition to the company and running the least established department.

Under these circumstances, there is no substitute for CEO leadership. It’s up to the head of sales to investigate the issues and propose solutions. If the departments can’t agree, the CEO has to decide.

So what should each department be focused on? Let’s have a look at each in turn.

Sales

Companies usually start their efforts to shorten sales cycles by requiring that sales reps share mutual action plans with prospective customers. These are a schedule of future activities that spell out what both the seller and buyer need to do to complete the evaluation and close the deal.

Mutual action plans are productive, but they only work when prospects want to take action. If they don’t see value in the product and in the sales process, they’ll ignore the mutual action plan.

The deeper solution is to create a process that proves value and delivers value.

This is really hard. I know because I’ve made a lot of mistakes in this area.

Here are some common pitfalls and ways to fix them:

Proving Value

When I was early in my sales career, I knew that I was supposed to sell value instead of selling features. And I probably thought I was.

But I wasn’t. Not really.

What was I doing? I’d do software demos on the first call. I thought we had a cool product so I showed it to people. I clicked here. I clicked there. I clicked a few more places.

Hopefully prospects were impressed and wanted to buy it.

I feel silly telling you that, but that’s what you get if you don’t train your team on how to sell value.

Superficial fixes don't work. Lots of companies create an ROI calculator: Punch in a few numbers that the rep can gather in discovery and out comes a huge estimate of the return on investment.

Here’s the problem: Numbers without a good explanation sound like the statistics you hear in an infomercial. Blech.

So what works better? You’ve got to help salespeople uncover the prospect’s problems, connect them with your solutions, and then draw out the impacts: Problem - Solution - Impact.

It’s only by connecting all three of those elements in that order that you sell value in a credible way: Problems create a need, Solutions address those needs, Impacts are what you get when you solve the Problems.

To get started, create Summary Slides for your team. These are one of the key resources in P.S.I. Selling. The first slide lists three Problems that you solve, the second lists three Solutions you provide, the third lists the three Impacts you generate.

Have your reps show those three slides before they demo, showing how Problems lead to Solutions which lead to Impacts. Ask them to get the prospect’s feedback as they present these slides. During the demo, reps should refer back to those messages when they are showing relevant parts of the product. Here are some tips for how to do this.

After the call, update the Summary Slides based on the conversation. Send them to the prospect so they have a way to pitch the product internally and keep the deal moving forward.

There’s plenty more you can do to sell value, but that’s a start!

Delivering Value

Here’s another thing I messed up in my early days of selling. I’d do a demo, I’d share pricing, and then… I didn’t quite know what else to do.

I’d keep following up with prospects to see if they’d gotten consensus to move forward, but honestly there wasn’t much reason for them to keep talking to me.

Why? I didn’t have any other value to add.

This meant that I had no way to accelerate the process. The prospect was going to do whatever they felt like whenever they felt like it and if they forgot about my product… well, that was too bad.

To fix this, your company needs to create assets and experiences that give prospects a reason to stay engaged, to keep making progress, and to introduce you to more members of their team.

Don't expect sales reps to figure this out on their own; creating value-added assets and conversations is hard.

Here are some ideas:

Application Presentations: These share tips on how to use the product that are relevant to the prospect’s situation. Ideally, this comes from a subject matter expert on your team. Failing that, give reps resources to spell out the three most common types of implementation so they can pick the one that best fits the prospect.
Customized Demos: Demo the configuration the prospect will use, not a generic one. This requires another round of enablement on top of what’s necessary to prepare reps to do a general demo.
Case Study Presentations: How did a relevant customer use the product and get value from it? Your company either needs to build very detailed case studies and thorough talk tracks or have a member of the post-sale team lead this presentation.
Proposal Brainstorming Sessions: Proposals should be tools for the champion to sell the product internally, so co-create them with your champion. This requires that you create proposals that prove value, not just share pricing! Here are some ideas for how to do that.

Managing the Process

Sales teams need to actively manage the buying process rather than just hoping that prospects stay on task. Some of this comes down to discovery: asking about and understanding the prospect's buying process.

But great salespeople do more: They propose specific next steps and get the prospect's input. They're not giving orders; prospects don't have to obey!

Instead, they say why the next steps they propose will benefit the prospect. This is different than selling the product; it's selling the value of the next step. Here are some tips for doing this effectively.

Companies can help by creating a deal guide that spells out the typical conversations that go into closing a deal and how each of them helps the prospect.

Here's an example deal guide:

Discovery Call and Initial Pitch: Helps both sides decide whether to take the conversation forward and ensures that the sales rep can speak directly to the customer's business needs in later conversations.
Champion Software Demo: Shows the main point of contact the software so they can evaluate if it looks like it will address their business needs.
Group/Business Unit Software Demo: Widens the conversation to include more stakeholders so they can evaluate the software and ask questions directly. The demo should be heavily customized based on what the sales rep has learned so far. This call avoids the champion having to be a go between carrying information and questions back and forth. In complex deals, the sales rep should do one of these for each business unit or user group that could be part of the deal.
Case Study Presentation: Shares another customer's experience using the product so the prospect has a sense of the value they'll receive.
Technical Scoping Call: Meeting with the prospect's IT team to figure out exactly how the implementation would happen, providing assurance that the product will deliver and letting the sales rep provide a customized proposal.
Proposal Brainstorming Session: Helps the sales rep craft a proposal that will allow the champion to sell the product internally.
Proposal Call: Presents the proposal to the champion and some of the other stakeholders to make the job of getting consensus easier for the champion. The sales rep also shares a draft mutual action plan to complete the evaluation.
Deal Planning Call: Touch point to refine the plan for completing the evaluation and the contract. Ensures that the champion has all of the support she needs and that all the key steps are in motion.
Implementation Call: After the contract is signed, we can start the process of implementing the software!

Notice when the sales rep in the deal guide above gets focused on making a mutual action plan (MAP): at the time of the proposal.

Why wait so long? To be clear, you should talk about the process for getting a deal done as early as possible. Usually that means raising the subject at the end of your first substantial call with the prospect. But these early discussions are typically general conversations that give you some visibility; they usually don't go past that.

Why? Making a meaningful MAP is hard: It involves commitments by both sides. Prospects aren't going to invest that kind of effort until they're bought into the process.

Everything changes after they see the proposal. Great proposals prove the value of the product, reminding the prospect of why they want to make this happen and causing them to want to make a meaningful MAP to complete the evaluation.

What's more, you can use the proposal to provide an incentive for getting the deal done in a timely fashion.

This is called before and after pricing: The proposal lays out a discounted price that the prospect will receive if they get the contract done by a (reasonable) date as well as the higher price they'll pay if they miss that date.

The sales rep can then propose a MAP that helps the prospect secure the discounted price.

Before and after pricing gives your champion a reward for moving faster and a tool they can use to rally their colleagues to prioritize getting the deal done: Does anyone want to hold the deal up and be responsible for costing the company money?

Product

Product typically doesn’t feel like sales cycles are their problem; at least not directly. They see their job as building a great product: The better the product, the more people will want it and the faster they’ll buy it.

That’s a fair perspective. It’s just not enough.

Product needs to devote about 10% of its time to making the product easy to buy. In practice, that means a little more focus on features that are boring but that squash objections and sources of delay.

Product does not want to do this. Product managers want to spec out whizzy features, engineers want to build them.

But the things that slow deals down (or kill them!) can be the dull things that nobody particularly wants to work on, like integrations, security, or compliance features.

It’s up to the CEO to set priorities: Product has to make a product that’s easy to buy and the company has to accept that this means fewer whizzy features.

Here are some ways that I’ve seen this go wrong in the past:

Security and Compliance

I worked at a company that didn’t handle sensitive data. So it didn’t prioritize getting the latest security certifications, like SOC 2 Type 2.

When we spoke to prospects about this, our message was simple: We’re not handling sensitive business data so it’s not necessary for us to be like Fort Knox.

As an objective matter, that was right. As a practical matter, it was wildly wrong.

The fear of making mistakes is one of the biggest blockers to purchasing. That fear is acute even for the business unit that you’re selling to that stands to gain from the product.

It’s even more intense for people who set buying policies, like procurement teams. They don’t directly benefit from the product. Why on earth would they set policies that create any chance that they’ll be blamed for something going wrong?

Every time you have to argue for an exception to a policy, you introduce weeks of delay into your deal and put yourself at the mercy of compliance and procurement staff who have nothing to lose by slowing the deal down while they subject you to further process or even by killing the deal entirely.

Sales doesn’t have a magic wand to make these policies go away. If you tell your sales team to “sell the product we have” it’s going to get sold slowly.

Only the product team can help by building a product that satisfies the policies your buyers actually have, not the policies you think they should have. And only the CEO can decide that that’s a priority.

Integrations

Another mistake I’ve seen is underinvesting in integrations.

Prospects worry about integration quality. A bad integration is the kind of thing that makes a product that looks good on paper perform badly in practice.

Robust, out of the box integrations help you leap right over this pitfall. By contrast, having to bolt something custom together or telling a prospect that they can build an integration themselves creates heartburn. And heartburn slows deals down.

Integrations don’t seem like they set your product apart from competitors so they don’t get the same level of priority as building whizzy features.

They’re also not technically exciting. Building them often isn’t seen as valuable experience for engineers or product teams; it’s more the equivalent of digging a ditch rather than designing a skyscraper that transforms a city’s skyline.

Product’s temptation will be to focus elsewhere or to build the minimum necessary to argue that they’ve ticked the box. That puts deals at risk and lengthens the sales cycle because it gives sales more problems to solve and more persuading to do before deals can close.

Once again, only the CEO has the authority to step in and focus resources on work that shortens the sales cycle.

Legal and Security

One common mistake is putting salespeople in the role of problem solvers for legal and security issues. This is asking for delay and confusion.

I once took on this role for myself and ended up feeling rather silly about it. A sales rep on my team told me that he had a legal call later that day and asked me to join to provide support. I wanted to help and I could see why he asked me to join given that I’m a former lawyer.

So I joined the call and listened to the other side’s concerns for about an hour. I asked a lot of questions and took a lot of notes. Then we went to our contracts person with the notes and asked him to come up with some revisions to address their concerns.

He asked me if they had proposed specific edits. In other words: Had they given us redlines? I said no. He told me he had no interest in negotiating himself: We needed redlines, not a list of concerns.

In that moment, I was pissed: We had a lot of information about their concerns. Why couldn’t we come up with something?

But on reflection, I see that he was right. When it comes to contracts, either the other side provides redlines with specific proposed edits or you’re not really making progress.

There’s no point in having a salesperson (even one who used to be a lawyer!) try to be a problem solver for legal issues.

So what is the role of the salesperson?

Project Managers, not Problem Solvers

The salesperson’s role is to identify the open issues, figure out who the point person is on your team, and determine what inputs that person needs to solve the problem.

Then, they need to go and get those inputs and hold the point person accountable for getting the issue resolved. In the example above, our contracts person needed written redlines. It was my job to get him the input he needed.

The company has a critical role here as well: to designate the point person to help with each type of issue and be sure they know that it’s their job to pitch in.

Clearly designating the point person for each type of issue smooths deal processes. Sales reps don’t have to hesitate before calling in the point person; they aren’t asking for a favor (though they should always be appreciative). Help is available to everyone on the sales team – even if they just joined and haven’t built any social capital yet.

Expert to Expert Calls

The point person for each issue should also be available for calls with the other side’s specialists if an exchange of written materials isn’t resolving the issue. Having sales reps try to be intermediaries between your experts and their experts creates avoidable delays.

I flubbed this one once as well. A high-performer on my team was working on a critical deal. We were close to getting it closed, but the other side started raising security concerns. I’d worked on deals with security issues so I jumped in to help.

We did our best to translate between the teams: We had calls with the prospect, got specific proposals from them (I’d learned that lesson at least!), did some research of our own to see if we could come up with ideas, and then brought those proposals to our head of engineering to see what he thought.

But we were getting nowhere: Some of the prospect’s proposals seemed so unusual that it wasn’t clear how we’d resolve them.

The solution was hiding in plain sight: We’d just hired a security engineer. Finally, we set up a call between him and the specialist on the prospect’s side.

In 30 minutes, they hashed out issues that had been vexing us for weeks. Problem solved.

Here’s a good standard process: Have the sales reps facilitate two rounds of proposals and counter-proposals between the experts in writing. If that’s not settling it, it’s time for the experts to talk directly.

The sales rep needs to arrange the call, create a clear agenda, and get your expert properly briefed. Then the expert takes it from there.

Prevent Issues Instead of Solving Them

Your company's experts may want to minimize the number of calls they have to join, and that's fair enough. The way to do that, however, isn't to leave the sales team to its own devices.

The solution is for your company's experts to build resources that prevent issues so they don't have to solve them.

Deals can get bogged down due to plain old misunderstandings. The prospect's legal, compliance, and security teams may not understand your product. After all, they haven't been on the sales calls.

Their default is to assume either that your product is really risky (better safe than sorry!) or that it's like the last vaguely similar product they had to deal with.

That can subject you to unnecessary process if your product isn't risky or isn't like the others.

One way to handle this is to create externally facing legal and security FAQs to share with prospects. External legal FAQs address any common misunderstandings about your product that could lead to unnecessary redlines. External security FAQs say why your product isn't a security risk (if you can fairly make that case) and why it's secure.

These documents can help head off questions and lessen the need for time consuming reviews and contract edits.

Make Legal Focus on Real Issues, not Hypothetical Ones

Another mistake I’ve seen is companies giving their legal teams too much power. Legal is there to advise on risk. But it’s up to the client – the company – to evaluate the legal team’s advice and make a decision.

When legal teams propose policies that slow deals down, the company has every right to ask the legal team to justify its position. Is this a real risk or a hypothetical one? Why do you say that?

Legal teams that get too excited about hypothetical risks can create a lot of friction.

I almost got blocked out of responding to a request for proposal (RFP) for a critical deal because of a hypothetical risk. The prospect was sending out an RFP but wanted us to sign an NDA first. The NDA had to be signed by a specific date otherwise we wouldn’t be sent the RFP.

I gave the NDA to our legal team for review and they wanted to redline it to change the forum – essentially the place where any lawsuit about the NDA would be tried. Any attempt to redline the NDA could take a week or more to resolve and would cause us to miss the RFP.

I had to negotiate with legal and escalate the issue. Finally, the legal team let us sign the NDA. They acted as though they were being generous. But to my mind as a business person this was a totally meaningless issue compared with the importance of the RFP. Legal should have apologized for even raising it given the time pressure we were under.

Delays like this can be squashed by running a proper process. Sales and legal should identify the areas of recurring delay and see if they can agree on policies that prevent hypothetical risks from delaying deals.

If there are remaining disagreements, the CEO should hold a meeting. Each side can present its case. Sales can say why the issue creates delay. Legal can say why they think it’s a real risk rather than a hypothetical one.

But ultimately, it’s up to the CEO to decide what’s in the interest of the company and what risks are worth accepting in the name of shortening sales cycles.

Accepting the Things You Cannot Change

There are meaningful ways to shorten your sales cycle but you also have to accept that there’s only so much you can do.

If you sell to governments or regulated industries, they have procedures they have to follow. You can help them execute those procedures efficiently but you can’t make them go away no matter how much pressure you put on your sales team. The next step in their process might be presenting your proposal at the next budget committee meeting. That meeting could be months away. Odds are that there's no clever solution; you just have to wait.

And – while you can shorten sales cycles – you can't perform magic. If you're hoping to flip a switch and turn your six month sales cycle into a three month cycle, you're going to be disappointed. You might be able to knock a month off of it after a few quarters or a full year of optimizing the process.

So do what you can do and then plan ahead. Generate pipeline and hire reps far enough in advance.

A little pressure is part of sales, but a lot of planning is how you generate results!

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Managing the Process