Common Mistakes in Sales Management (Part 7): Forcing the Wrong Deal

(this post originally appeared on LinkedIn here)

There are Won Deals, Lost Deals, and – worst of all – Wrong Deals, the deals you win that eventually make you lose because your company can’t deliver, a clever competitor will make you die by a thousand cuts in executing it, or they get you aligned with the wrong power base.

Unfortunately, there are sales managers who regard every opportunity a must win, who don’t understand that a Won Deal can in fact be a Wrong Deal.

The Won Deal is the one that establishes a strong win-win between the buyer and the vendor. Ideally it is so perfectly fine-tuned that it optimizes the value for both parties and none of them could win by taking away from the other. These are the deals that provide the steppingstone for even more valuable agreements in the future.

The Lost Deal is the one you decided to pursue but couldn’t win. Coming in 2nd is the worst possible outcome because the pursuit consumed the same amount of effort it took for the winner but with zero measurable outcome. At least it’s over, you can wipe your mouth, learn the lesson, and move on.

The Wrong Deal is a disaster in the making. While it might still look great at the time the order arrives it will soon turn into a nightmare, e.g., because the customer isn’t able to provide the required contribution, the vendor cannot make the product work, or – even more damaging – it got us aligned with a power base that is doomed to lose out against another, more powerful one.

While the first two scenarios mean we at least still have a chance to turn the engagement into something positive, albeit at a very high price, the last scenario means that this was most likely the last deal we won at this customer for a long time.

Sales management forcing the Wrong Deal will lose twice: First it means to win a deal that will consume the best people in post-sales just to control the damage and hopefully fix it; second, they will lose the salesperson who will pick the commission check and run from the disaster.

So, what should sales management do instead? They must listen to the sales team’s objections, understand the risks of the deal in the very detail, and agree to disengage by the time the team concludes that this is going to be a Lost or, even worse, a Wrong Deal.