Having spent most of my career in Product Marketing prior to joining Gartner, I have been involved in win/loss analysis multiple times and from several angles. Normally, there is a concern bubbling up from sales or executives that we are not winning enough of the deals and we need to understand why. Win/Loss analysis seems tailor-made for that situation. Sometimes the win/loss analysis comes from a desire to better understand best practices in the sales force and this is one tool to help understand what is done differently on won deals versus lost deals. Occasionally, win/loss analysis is just a standard report requested by sales leadership or other executives within the company so there is an on-going process to provide the report.
In my experience, the motivation for the program is just one of the reasons why it can fail. Let’s look briefly at these three scenarios to understand why each can fail.
- Not winning enough deals – This situation is inherently an issue as normally the initiators of the analysis are looking for quick results. Unfortunately, gathering objective information on wins and losses that can really lead to valuable conclusions means gathering consistent and objective responses from the customer or prospect on enough deals to provide a statistically significant indication of what has worked and what hasn’t. Even if you have a good survey already developed, the time required to connect with prospects and customers will almost always take far longer than the patience of those desiring the analysis. Short cuts on the number of responses or the source of the responses can both lead to drastically incorrect information.
- Understanding best practices – This one is a tricky trap for win/loss analysis. While customers can provide objective information on what mattered and what didn’t during a sales execution, this data is very difficult to collect accurately. What’s important to one customer may not be important to another and given the number of variables between different sales reps, different customers/prospects across wins and losses, this takes an enormous amount of data to be significant. Also, you need to have sales cooperation for win/loss analysis to be successful. If sales feels that the program is primarily being used to evaluate their performance, they can definitely skew the data. How many times have you heard “You will receive a survey evaluating my performance. If you plan to give me anything less than perfect, please let me know and I’ll fix the issue so you can give me a perfect rating.” Sales can definitely influence the responses. So, best not use win/loss analysis for this. Honestly, this is a sales management function and can be informed by some great industry research available on the topic (See Challenger Sales Method).
- Standard reporting requirement – Frankly, this is the right motivation for win/loss analysis. Unfortunately, these programs are normally implemented by including a win/loss reason field in the sales opportunity management solution. This is filled out by the sales representative (if required) when closing the opportunity. Ironically, this leads to a lot of conclusions that price and product features are the main reasons you are losing deals. Additionally, it is very difficult to provide a set of choices for sales that encompass all of the possible situations. So, sales will pick whatever they think is closest to accurate and/or whatever doesn’t implicate their execution on the deal as an aspect of the reasons. It’s not always blatant disregard for the truth that gets in the way, quite often sales doesn’t know the actual reason for the loss. Accurate information has to come from the horses mouth.
Look for more on this topic soon. In the meantime, I would love to hear from you.
Are you using or have you tried win/loss analysis?
Why were you using win/loss analysis?
Do you know if it was successful in improving your business or whatever your goals were for the program?
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