Improve Sales Management with Deal Pipelines
This guide shares my approach to building pipelines and stages from the ground up, as well as how to optimize them for effective usage.
Why getting pipelines and pipeline stages right is important
Reporting is more accurate. When entry criteria and data requirements get standardized, the answers to why certain deals move through and why others stalling out become increasingly clear. Without this standardization, there’s only intuition to rely on and it’s impossible to create a report to learn about what is causing outcomes.
The sales process becomes standardized. Standardization is table stakes for optimal deal management. After implementing these pipeline optimizations, weekly sales management conversations are more effective, take less time, and become more transparent for all involved. It all stems from the sales team agreeing to move deals through the pipeline according to the same rules.
Pipeline management gets dialed in. Once the foundations are set, it becomes obvious which custom items need to be built to fully optimize the sales pipelines. A common custom upgrade is sending out alerts when a deal close date has passed or is updated too many times.
Here’s how to dial in a new or existing pipeline setup:
1. Name the pipeline(s) and its stages.
How many pipelines are needed? What stages does each need?
Most startups generally only need one or two pipelines. Here’s a good rule of thumb to use when deciding: if the sales process is largely the same, lump those deals into the same pipeline. If they are drastically different, consider a new pipeline.
1.1 - Open a spreadsheet and create columns for “Pipeline” and "Stage 1”, “Stage 2”, “Stage 3”, etc.
1.2 - Think through the stages in the new sales pipeline. Write “Sales Pipeline” in the first line and specify the major stages you expect most new business deals to pass through.
1.3 - Determine if renewals are important to separate out. If so, create another row for a renewals pipeline and its stages.
1.4 - List out entry criteria, which can be thought of as the reason why a deal should enter each stage. This is useful when there’s only a few deals, but absolutely essential as sales volume increases and sales headcount grows. The stages should be separate enough that there’s very little confusion as to why a deal was created or moved into the stage it was.
What a filled out spreadsheet with a new sales and renewals pipeline looks like. Stages and entry criteria for each stage are also included.
2. Set required data entry per stage
Prompt the sales team with a popup for required information whenever they move a deal into a new stage.
Requiring deal data per stage has the potential to fix a bulk of your data issues overnight. It’s a little thing that often gets ignored, but it’s silly not to add because the rewards are significant. Tactically, it results in sales people knowing what’s expected of them and sales managers needing to ask fewer questions.
Here’s a good way to plan out what fields will be prompted and/or required per stage:
2.1 - Create a “Required Data” row for each pipeline, beneath the “Entry Criteria” row.
2.2 - Fill in the required data per stage. These are important to set up, but expect to tweak these requirements as the sales team offers feedback. You can technically “prompt” the sales person with data to fill in and not require it, so using an asterisk to mark “required data” is helpful.
A completed spreadsheet with pipelines, stages, entry criteria, and data requirements
3. Create the pipelines in Hubspot
Reference the spreadsheet and publish the updates.
This is all done in the deals section of Hubspot settings:
3.1 - Create the pipeline(s) or edit the existing.
3.2 - Add the stage names. Make your best guess for probability of the deal closing from each. This can be updated based on real data later.
3.3 - Specify the prompted and/or required fields per deal stage.
Most of this is done via Settings > Deals > Pipelines
4. Tweak things over time
Try not to update stages, but smaller items should be expected to evolve over the short and long-term.
Stages - It’s a good idea to solidify stages early on, because moving deals around will throw off important reporting (e.g. conversion rates between stages).
Required data - What was specified and implemented at first may need to change based on feedback from the sales team. These are easy to update.
Probability - It’s possible to set the expected win rate for each stage. Ideally, this is set based on actual close rates, but educated guesses can work at first. Once you have a good amount of deals flow through over a few quarters, review conversion rate reports and update these.
Automated actions - When a deal enters a stage, you can make things happen automatically. For example:
When a deal’s close date has passed by a certain amount (or has changed more than a couple times), a notification can go out to the deal owner to let them know.
Alerts can go out to the whole company via Slack when a deal has been closed won.
A company and its contacts can be marked as a “former customer” when a renewal deal is closed lost.
Takeaways on pipeline creation
Pipeline setup and management is directly tied to better sales processes and reporting that feeds back into the sales process. If these aren’t agreed upon and standardized, sales management and reporting will continue to be more messy than it should.
Defining pipeline names, stages, and entry criteria build the foundation for the teams’s sales cycle structure. It’s worth taking the time to think through how this should be set up for the company.
After making the updates, pay attention to feedback over the course of the next month, quarter, and year. Things will come up as sales uses this structure to connect with prospects. Some items you may want to keep but there will likely be great ideas that come from the teams.
