Win Loss Analysis: A Strategic Imperative

Written by Richard Schroder

The first question salespeople ask themselves when they lose in a new business situation is, “Why did I lose?” Salespeople often ask prospects why they lost a deal, but they don’t typically get a straight answer. In fact, according to sales research data, the complete truth from prospects is shared only 40% of the time. This means that on average, in 60% of new business situations, salespeople do not have a complete and accurate understanding of why they lost.

Win - Loss Understanding why a deal is won or lost is critical, yet most sales teams and companies have a limited understanding of the true reasons for winning and losing. Clearly there is a significant opportunity for many companies to improve their close rates by better understanding prospect perceptions.

One proven way to achieve this is to implement what has become known as a Win / Loss Analysis Program, whereby an independent third party interviews prospects after buying decisions have been made. It is only through this type of process that sales teams can learn the true, candid reasons why they win and lose. Although over the last decade more and more companies are implementing formal Win / Loss Programs, at present, less than 20% have done so. Therefore, the majority of companies are missing a critical opportunity to improve their sales performance, better understand their competitive landscape and enhance their products and services.

In order to understand why Win / Loss is so critical, it is important to first recognize some of the reasons why it is difficult for salespeople to gather this information:

Prospects feel uncomfortable giving feedback and criticism directly to sales reps.
Prospects often have issues with the sales rep or sales process that can impact their candor.
Sales reps are not in an objective position to obtain feedback because they are too emotionally involved in the situation.
Sales reps usually do not know the right post sale questions to ask (and how to ask them).

This problem is compounded when fragmented (and often faulty) prospect feedback is spread throughout an organization. Since salespeople typically do not get an accurate depiction of why they lose, they often unknowingly disseminate incomplete or inaccurate information within their organizations. Compounding this problem is that there is usually no clear process for capturing and relaying prospect information companywide.

This common organizational behavior ultimately corrupts decision making as senior managers make decisions based on inaccurate information derived from prospects who were not fully candid and salespeople who are not in an objective position to gather and share unbiased information. Collectively, this can lead to strategic misalignment.

One proven way to circumvent this problem is to implement a formal Win / Loss program whereby someone who is uninvolved in the sales process interviews prospects post-decision. When accurate Win / Loss interviews are captured by an independent third party, information can be shared in a more organized manner and most importantly, the information stays consistent at every level. The information does not change as it moves around the organization and therefore, better strategic decisions can be made.

The most important long term goal and benefit of Win / Loss is to increase a company’s new business win rate. This is achieved through an improved understanding of how a company’s sales team and products and services compare with the competition during the sales process. Other benefits include:

Identifying a company’s strengths and weaknesses.
Improving the effectiveness of sales presentations.
Determining key drivers for closing new business.
Formally sharing prospect perceptions across all areas of an organization to enhance product and service development.
Benchmarking and tracking a company’s sales effectiveness and products and services against the competition.

Win / Loss Analysis offers companies a significant accumulative advantage over the competition, the benefits of which can grow substantially over time. By committing to a continuous and unbiased prospect feedback loop that can be shared with all areas of an organization, companies can more accurately make enhancements at all levels. Over time, this management tool can allow a company to charge ahead of its competition by continually keeping a pulse on industry trends, the competition, and needed enhancements to the sales process, products and services.

Richard Schroder -
	Richard M. Schroder is president of Anova Consulting Group, a market research, sales training and consulting firm. He is a sought-after speaker and a recognized thought leader in win / loss analysis and sales training. He is also the author of a book called "From a Good Sales Call to a Great Sales Call" about Win/Loss Analysis, published internationally by McGraw-Hill. He lives in Chestnut Hill, MA. Learn more about the Anova Consulting Group at www.theanovagroup.com. Read More >>
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