Opportunity Sales Process in Dynamics 365 & Sales Cycle Calculation

In my last blog, "Adding Rocket Fuel to Your Segments in Business Central," I discussed using the Segment to pinpoint our targeted audience.  We used a combination of Segmentations assigned to our Contacts to limit our scope to those Contacts that met the requirements of our targeted audience. Now it’s time to drive your sales pipeline using Opportunities and Sales Cycles in Business Central.

Opportunities

Now that we’ve created a Segment with our targeted audience and we’ve identified those Contacts who’ve expressed interest, we need to record and follow up on those interests.  An Opportunity is created for the Contact who has expressed interest and the Sales Rep who will be working on the Opportunity.  Opportunities allows you to tailor your sales approach and actions.  Your sales staff is not homogenous – you may have seasoned veterans and inexperienced rookies; some may be overly optimistic, and some may be preposterously pessimistic.  When you are choosing a tool for your sales staff, you want something that will be consistently and universally utilized.  If your Sales Staff views this tool as a burden, they are going find reasons to avoid it.  Fortunately in Business Central, you can configure Opportunities for the various types for products in your portfolio and the diverse personalities within your Sales Staff.

Sales Cycles

The Opportunity gives you a Description which should be a summary of the deal you are trying to win, the Contact information, the Salesperson, the Sales Cycle Code and the Status.  A Sales Cycle allows you to define the Stages or steps that must be completed to close the deal / “win the Opportunity”.  The Sales Cycle Stages display the key financial information related to the Opportunity, include the Stage, Date of the Last Change, Estimated Close Date, Estimated Value and Calculated Current Value.

Opportunities are flexible because you can assign a different Sales Cycle to each Opportunity.  That doesn’t mean you should create a separate Sales Cycle for each Opportunity, but it does mean you can establish separate Sales Cycles for each Item Category, or for each member of your Sales Staff.  Deciding how many Sales Cycles to use and the steps and definitions involved is a fascinating discussion for any sales team. Likely it will also be a frustrating discussion, but will go a long way in getting everyone on the same page.

When setting up Sales Cycles, Sales Cycles Codes are used to differentiate the various Sales Cycles, as shown below:

Stages of a Sales Cycle

The Sales Cycle for an existing customer should be less involved than the Sales Cycle for a prospect to whom you’ve never sold.  Recognizing that the sales process is not the same with each client, or each Sales Rep, you can define steps that can be skipped.  For example, if the standard Sales Cycle shows the second step is a follow-up phone call, but the Contact has already given the Sales Rep a Purchase Order, the Rep would want to skip that step. This would be possible with the “Allow Skip” option enabled for that step, saving them time on unnecessary documentation.

Below you see that Stage 1 and Stage 2 in the Existing Customer Sales Cycle can be skipped.  You also see that before proceeding to Stage 3 or Stage 4 a Sales Quote is required.  This avoids the issue where the Sales Rep checks the box but forgets to do the paperwork.

As an Opportunity is updated from one Sales Cycle Stage to the next, the Sales Rep has the ability to update the Estimated Close Date, but Business Central will automatically update the Date of Change to the current Work Date and the Calculated Current Value based on the Probability Calculation assigned to the Sales Cycle.

The Sales Cycle also gives you four options to calculate the current value of the Opportunity.  While you know the Estimated Value of the Opportunity if it is won, Business Central automatically updates the current value of the Opportunity when you update the Stage of the Sales Cycle, (updating the progression of the deal).

Calculated Current Values

In the first picture of the Opportunity, it was in the Initial Sales Cycle Stage with an Estimated Close Date of 2/29/2020 and Estimated Value of $3,000.  It was only 2% complete.  Based on the “Completed %” Probability Calculation assigned to the Existing Sales Cycle Code, the Calculated Current Value as of 11/26/219 was $60, or 2% x $3,000.

In the picture below, the Opportunity still has an Estimated Close Date of 2/29/2020 and Estimated Value of $3,000, but it was updated on 1/4/2020 to the Presentation Stage, which is 50% complete.  The updated Calculated Current Value is now $1,500 or 50% x $3,000.

A default Sales Cycle Code can be set in the Marketing Setup.  You can allow all Sales Reps or only the senior Sales Reps to change the Sales Cycle Code on their Opportunities.  This would allow you to direct your junior Sales Reps to follow a sales best practice until they reach a specific target.

I started this discussion about Opportunities as a development from the Contact in a Segment with a targeted audience.  However, every touchpoint with a Contact has the potential to become an Opportunity. An outside Sales Rep could create an Opportunity after receiving a phone call or email from a Contact requesting information about a new product, or additional functionality.  An inside Sales Rep could create an Opportunity after creating a Sales Quote for the Contact who requested the Sales Quote at the sales counter.  The Opportunity records the sales potential and provides planned follow up Stages or steps.

As a quick recap, Opportunities are flexible sales programs that provide guidance to the Sales Rep on what the next step is in the sales process, which can be more effectively managed using Sales Cycles.  The Opportunity also provides an estimated current value as each stage is updated.  Sales Reps can use this as a barometer for upcoming commissions and management can use this for sales projections.  As the Sales Staff becomes more familiar with the process and they understand the benefits they receive using Opportunities the information becomes more reliable.

Be sure to check out my next blog in which I discuss Interactions.  Interactions are an easy way to track and evaluate the communications between you and your contacts in Business Central.

To start at the beginning of Robb’s Business Central Relationship Management series, see his first blog post: The Great Debate: Who owns the information on the Customer Card in Business Central? Accounting or Sales?