Skip to main content

As the funnel turns…

By February 9, 2016July 15th, 2018Metrics

One of the most vital of sales process metrics is Cycle Time. How long, on average, does it take to convert a newly identified sales opportunity into a purchase order? Comparing and contrasting Sales Cycle Time across different members of the sales team and different products and services consistently yields insights that lead better best practices.

There’s a different way to think about the same number that makes even more insight pop.

Think in terms of “turning” your funnel. (It’s much like the notion of inventory turns, if you happen to be familiar with managing a warehouse or retail store.) Just divide 365 by your Sales Cycle Time. For example if Cycle Time is 90 days, 365 / 90 = 4 Funnel Turns per year.

If you’re running a warehouse, 4 Inventory Turns means that in effect you totally empty and refill your storage space 4 times each year. Except… What about those 300 “boat anchors” that have been sitting in the corner since grandma was a girl? Since they never move, I must be turning the remaining inventory more than 4 times.

Same idea with your funnel. Is 4 “Funnel Turns” per year good? Or should it really be 6? Or should I go after much bigger deals where 2 turns annually is enough to make quota? And how many “boat anchor opportunities” are gumming up the works? Any in there that haven’t progressed this decade?

Simple questions. But not so simple to come up with the answers. How cool would it be, and how much would each sales team member learn by having a few lively debates about who has the “correct” sales funnel turnover?

Think about it…

Leave a Reply