Cracking The Pareto Code

Cracking the Pareto Code

Summary: Want to join the Top % of all Salespeople in the world? Learn how to apply Pareto's Law (/ Rule) and build your own day action plan for success!

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Article Body: Ever heard of the / Rule? Thats the well-known principle that says that in every sales organization % of the salespeople win % of the sales (and money!) while the remaining % are all splitting up % of the revenue. So, which category do you want to be a part of - the Top %, or what I refer to as the Sales HEROES, right?

Where did this rule come from? In fact, the / rule is not a rule, its a law. It comes from the work of Vilfredo Pareto, an eighteenth-century Italian economist. His studies on economics and productivity led to the conclusion that in just about any endeavor, percent of the productivity will come from only percent of the efforts. Eighty percent of the profits are produced by percent of the employees. In a police force, percent of the arrests are made by percent of the officers. It can be applied another way: percent of a businesss customers create percent of the problems. And so on.

Want to be a Sales HERO? You can use Paretos Law to your advantage! Create an action plan that embraces the law rather than fights it. Meetings, crisis management, phone calls, office chat, paperwork, getting your ducks all lined up in a row are NOT part of the percent of your activity that is directly attributable to creating new business. There is only one task proven to directly lead to achieving your sales objectives: cold calling or prospecting. I have seen every possible attempt to find a way around Paretos Law but none has succeeded. Once you accept the reality that you cannot change the rules of the numbers game, you will be able to make the decision simply to play by the rules or quit.

How many prospecting calls do you have to make? Lets apply Paretos Law to find out. Lets say you decide to complete prospecting calls in a given period of time. According to Paretos Law, you will have had to walk through about five doors or made five phone attempts to actually reach one decision maker ( percent of the total). Therefore, you will make attempts to attain your goal of completing prospecting calls. Of the decision makers you actually spoke with, ( percent) are going to have a genuine interest and will stay in the game your pipeline for further follow up, while ( percent), no matter how good at selling you are or how much you know they need what you have to offer, are simply not going to be interested they are out of the game for the time being. Now, through appointments, proposals, and follow-up calls, you will find that percent (or ) of the prospects that were still IN the game are not going to buy (at least not right now), for whatever reason. There is absolutely nothing you can do about it. Its not you, its the law. Dont worry, they may get back in the game later! That leaves four decision makers who buy your product now! Congratulations, you just made your first four sales! At first this may seem like small reward for all your efforts, but you will learn that it is a good, solid formula that will always help you get from ZERO to Sales HERO in days!

Try this - Invest % of your productive time prospecting for new business for three straight months. If you do, youll find that from there forward you will never need to invest more than % of your time prospecting to keep your momentum going. As you mature in your sales career you will learn many skills, techniques and ideas that will help you learn to work smarter rather than harder, and to leverage relationships and referrals to build your sales empire. Just remember whenever you start fresh with a new opportunity, or if you find yourself in a slump and need to get out of it fast start a day action plan that embraces Paretos Law I guarantee you will be on your way to the Top % of all salespeople in the world!