Zipf Law of Power Funnel Management

How often do you think on the make-up of your pipeline portfolio?

How your funnel is constituted can have a huge effect on productivity.

Directly impacting on your commission, career and clout.

Chasing solely the high contributing campaign(s) can lead to dependence on the odd Whale, periods of feast rare in the face of lengthy famine, and an unhealthy dependence on a particular type of notoriously fickle deal.

Pursuing too many lower value bids can lead to a struggle to reach the overall quota line, stretching your own precious resource too thin, and a troublesome reliance on discounting to seek rapid deal conclusion.

A mix is often the preferred route. Blending fewer numbers of each class, big or small and all in between, but without confining to any one particular strata.

Indeed, when my first ever big Sales boss gave me their few words of wisdom on this, the metaphor of the motorway was invoked. Our fastest roads (back then) had three lanes. Slow, medium, fast. Or as the highway code might have rather put it; lorries, the rest, overtaking only. The point being you had prospects running at different speeds. Both in terms of overall deal length and the value they brought to your target. Never rely on only one lane. That was the message. You were advised to have a nice balance from all three to guarantee each year making 100%+.

Zipfian distribution, from the field of linguistics, suggests the first tends to be twice the second, three times the third, and so on.

As well as in the occurrence of words, it is applied to all manner of real world situations. In 1949 Zipf himself posited that a country’s Capital population tends to be twice that of its Second City (England sadly an exception).

Zipf’s Law is what’s known as a Power Law. In fact, an empirical power law for rank and frequency of size.

It strikes me that a kind of such power law for forecast management might well be useful.

Do you have one?

It needn’t be wholly statistical.

Unless you are selling a relatively new startup type enterprise – and even there you may have some empirical comparison to feed from, if even only buying patterns of perhaps linked purchases – there will be a history somewhere of the kinds of deals that make for great clients.

How long they run. How their demographic and psychographic make-up goes. And how much they are worth.

For me, the true balance of a forecast is very much about how close to your process each bid is running.

As regular readers will note, this does not mean the training company, often crm-screen driven rubric that might be in play from the previous Chief Sales Officer. No matter how ‘bespoked’.

It refers to the actions, activities and actors which, when occur as you set out, ensure that the deal comes home. Pretty much without fail.

These may of course, include some of the expensively paid-for elements brought in from outside. But any true repeatable, winning process tends to feature so much more. And of items totally specific to you.

Coming back to Zipf, what does a forecast look like of the regular achievers?

What proportion of large to small deals does it contain? How many quick-hit versus slow burn timescales has it? How many deals stray from the supposed ‘standard’?

Your power law needn’t arise as your largest deal being twice the size of the next, then three times the third. Yet knowing which proportion exists to precede success could truly set you apart.

An optimum recipe should emerge. Now, how can you bake that in across the board?

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