The loss review nobody runs on the deals that got away

4 days ago
3 min read

Updated: 2 days ago

Introduction

Businesses examine won work constantly — margins, delivery, satisfaction — and examine lost work almost never. The deal is closed, the record is marked lost with a one-word reason nobody chose carefully, and everybody moves on. The information in those records is the most direct evidence available about what is wrong with the sales process, and it goes unread.

The reason is partly discomfort and partly that a single loss teaches nothing. Any individual deal has an idiosyncratic explanation. It is only in aggregate that the pattern appears, and the pattern is almost always different from the impression formed by remembering the most annoying recent examples.

1. The loss review nobody runs needs twenty losses, not one

The unit of analysis.

Individual deals are noise. Twenty of them, read together with dates, values and reasons, produce a finding that no single case would have suggested. In a business doing a few deals a month this means reviewing quarterly rather than after each loss.

2. Record two reasons, not one

The data structure.

What the buyer said, and what you concluded after asking. These differ frequently, and the gap between the columns is the most informative thing in the whole exercise. Price appears far more often in the first column than in the second.

3. Check the losses against your response times

The correlation worth testing.

Sort by how long you took to reply and to quote. If the slow half loses disproportionately, you have found something more actionable than any conclusion about price. This comparison takes ten minutes and settles an argument most businesses have repeatedly.

4. Segment by job type and source

The second cut.

Losing most of one kind of work while winning another is a positioning finding. It tells you where you compete well and where you should consider not quoting at all. Declining a segment you never win frees capacity for the one you do.

5. Look at the stage where deals stop

The location.

Lost before a quote, after a quote, or after a decision was apparently made. Each points at a different part of the process, and they need completely different responses.

6. Count the deals that went nowhere at all

The largest category, usually.

No decision, no competitor, no response. These are frequently more numerous than deals lost to rivals, and they indicate a follow-up problem rather than a competitive one.

7. Ask a sample of lost buyers directly

The evidence nothing else provides.

Ten short messages a quarter, asking without arguing. The response rate is low and the answers are the only first-hand information about the comparison you will ever get.

8. Do it on a fixed date

The reason it happens at all.

An hour, quarterly, in the diary, with an owner. Reviews that depend on somebody feeling like examining failures do not take place.

9. Change one thing and check next quarter

The output.

One conclusion, one change, one owner, and a comparison at the next review. A review producing five observations and no decision is a discussion rather than a process.

Be careful about over-fitting to a small sample. Twenty losses in a business doing forty deals a year is a reasonable basis for a hypothesis and not for a strategy, and the honest response to a weak signal is to keep recording rather than to act decisively.

Conclusion

Read twenty losses together on a fixed date, because individual deals explain nothing.

Record both the stated reason and the reason you concluded, test the losses against your response times, segment by job type and source, note the stage at which each deal stopped, count the ones that went nowhere at all rather than to a competitor, ask a sample of lost buyers directly, put the review in the diary with an owner, and end with one change to check at the next one.