In the high-stakes business development arena, your success hinges on evaluating, pursuing, and, when necessary, knowing when to stop pursuing a lead. While I'm not much of a gambler, the professional poker players' wisdom of "optimal quitting" offers a strategic lens through which you can view your business development efforts. A recent article from Wharton pointed out that "expert players abandon about 80% of their hands in the popular variant of Texas Hold’em, for example, while amateurs stick with their starting cards over half the time." That's a lot of quitting. But the results speak for themselves. Today, let's apply the "optimal quitting" approach to business development. Optimal quitting encompasses three pivotal steps: conducting timely cost-benefit analyses, setting 'kill criteria,' and acknowledging incremental progress.
Periodic Cost-Benefit Analyses: Should You Stop Pursuing a Lead?
Once a prospect enters your radar, the initial goal is to convert that prospect into a new client. However, as market dynamics shift, so should your goals. A periodic cost-benefit analysis serves as your reality check, ensuring your energy and resources to nurture a lead align with the potential payoff to your or your firm.
Let's face it: every minute you spend pursuing a lead that doesn't convert into a client is wasted time — time you'll never get back. This analysis focuses your attention on the opportunity cost of that lost time—evaluating what you could gain by reallocating your resources to other promising leads or initiatives. Scheduling regular reviews of your prospect database and, more importantly, each prospect's movement along the acquisition journey allows you to stay attuned to evolving circumstances and tweak your strategies as needed to maximize the results of your efforts. By understanding your opportunity cost, you can make informed decisions, optimizing for the best possible outcomes in your business development efforts.
Establishing 'Kill Criteria': Deciding When to Stop Pursuing a Lead
Not all leads are created equal and are worth your undivided attention indefinitely. Establishing clear 'kill criteria' empowers you to discern when it’s rational to stop pursuing a lead or at least move from active to passive lead pursuit tactics.
These criteria might encompass a spectrum of factors – from a lack of engagement from the prospect to a shift in market demand or failure to meet certain defined milestones. For instance, if you're actively engaging a lead, cold calling with content, and you stop seeing engagement with the content for a prolonged period, it might be time to move that lead from an active to a passive outreach campaign. Likewise, if you've been actively engaged in a pre-sale conversation with a prospect and they keep putting off the next step — contracting for services — you may be hearing a polite "no thanks." But, if you're not stepping back to review engagement, you might miss the signals and keep wasting more valuable time. Again, it's okay to move these prospects to a passive outreach campaign and focus your valuable time against only the most high-value targets on your list.
This rational framework prevents overcommitment to less promising leads, ensuring you channel your resources towards more lucrative opportunities. Take a few hours to go back and review every non-convert prospect that you've pursued over the last few years and make a list of all the signals you may have missed. Look for trends and engagement commonalities. Then, use these as your new Kill Criteria for six months. After six months, reevaluate the return on your business development investment.
Valuing Incremental Progress: Shifting Beyond the Win-Loss Paradigm
In the traditional win-loss business development paradigm, the focus often narrows to conversion, overshadowing the longer value of incremental progress made during the nurturing process. Instead of getting caught up in the world of win/loss, embrace a broader view, where even non-converting prospects are seen as valuable. Not only can these "lost" opportunities reappear as social agents (especially when their reason for not hiring you had nothing to do with you or your firm), opening up avenues for high-quality referrals and future opportunities.
Here are a few key learnings that represent true long-term value that you can use as non-conversion KPIs to evaluate the effectiveness of your business development program:
- Micro Goals: Craft smaller, achievable goals for each stage of the nurturing journey. These could include things like the prospect engaging with your digital content, engaging with a social media post, returning an email, attending a webinar, or taking a phone or face-to-face meeting. Meeting these micro goals makes you feel better and provides a more precise gauge of a lead’s potential over the long term.
- Regular Progress Reviews: Once you've set your micro goals, regularly review your progress against these micro goals. This practice can unveil areas of improvement and help determine whether a lead merits further pursuit. For instance, you may notice that certain content efforts or email campaigns tend to result in disengagement. If so, revisit that content or those campaigns to uncover the source of the undesirable results.
- Learn and Adapt: As you chronicle your learnings from each interaction, regardless of its outcome, use the insights to refine your strategies for upcoming prospects. Never be afraid to change your approach or try new things. Ruthlessly delete anything that isn't working for you and do not see that as a failure. Failure only occurs when you fail to achieve a goal AND fail to learn anything from that experience. The worst thing you can do is continue with an ineffective tactic because you don't want to "give up."
- Feedback Loop: If you're lucky enough to have a team helping with business development, initiate a feedback loop to share insights and learnings from each business development effort. It doesn't have to be anything fancy. I once used the agency's internal chat function to do this. I set up a Business Development channel, and everyone engaged in business development had access. We used hashtags to help us tag our posts, creating a searchable database of posts, content, templates, results, and reports. It was an instant and always-growing knowledge base that proved extremely valuable. As long as that knowledge base grew, I knew our business development efforts added value.
- Nurture Potential Social Agents: Recognize that even non-converting prospects can create value for your business development efforts if they become Social Agents. Don't make the mistake of writing off a non-converting prospect or a prospect that you determine isn't or never could be qualified. Nurtured properly, they might just become the most valuable client that never hires you. A positive interaction with you and your firm can lead to referrals, creating a ripple effect of opportunities even when the immediate goal isn’t met. Said differently, a client can hire you once but a Social Agent can tell everyone to hire you!
Let me sum it up like this. Quitting, defined as deciding to stop pursuing a lead, isn't the problem. Knowing when to quit pursuing a lead is THE issue that sabotages business development efforts. Set pride aside and take solace in knowing that you will not convert every lead and don't want to convert every lead. Let's face it: every prospect isn't a good match. The secret to success isn't converting every lead; it's having a strategically focused, continuous business development process. As I've said before, in business development, discipline delivers.
The wisdom of "optimal quitting" is integral to that discipline. By forcing yourself to conduct periodic cost-benefit analyses, setting your 'kill criteria,' and valuing any incremental progress, you construct a nuanced approach to business development. This approach sharpens your focus on the most promising opportunities, continuous learning, and adaptation. Moreover, viewing non-converting prospects as potential social agents broadens your opportunities, setting a foundation for a sustainable and fruitful business development program.
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