Less than 20% of companies[1] have an active win/loss program. Others try to gather this vital information but make some basic and costly errors.

The most frequent error we see is having the sales rep or sales manager who lost the deal call into the account for feedback. It is human nature to let people down easy, apparent to anyone who has ever watched an episode of Seinfeld is aware of the “it’s not you, it’s me” excuse.

Too often, sales managers debrief their sales reps or account managers to try to understand why they lost a specific deal in their pipeline. Really, what is the incentive of a sales rep to explain where he was unable to communicate value? And, even if integrity is not an issue, how can a sales rep possibly understand all of the client-side dynamics that were in play?

Some companies task the marketing organization with these calls, but they risk sending biased information up the chain of command. One recent study found that the reason the reps were losing deals was not on product features as they initially hypothesized, but because they rarely returned the prospect’s repeated calls. Since sales did not want this type of bad behavior broadcast throughout the organization, the results were squelched, and the wrong never righted.

If you are serious about improving your win rate, your analysis should answer the following questions:

· How is your company perceived by the marketplace?

· Which of your competitors made the short list?

· The real reasons for winning and losing business.

· Product strengths and weaknesses.

· How your pricing stacked up.

· If your sales process is providing adequate differentiation; and most importantly

· What could have been done differently to win lost business?

Many product managers and VPs of Sales think win/loss analysis is a good thing since it will help them build a wish list to go beat up engineering with. The truth is that a win/loss analysis is much more likely to uncover a process problem than product gaps as the major reason for losses.

Knowing that there is likely to be bad news about the sales process makes it even more sensible to have a third party complete the analysis and deliver the (bad) news. Unless there is an action plan that will be put in place and backed by the senior exec’s, the study is a complete waste of time and will offer no benefits.

Taking no action, after reviewing the painful truths that often emerges from a win/loss study is the second most egregious error I have ever seen.

Hiring someone to help with the process costs money, but the benefits will help you win more deals.

If you are interested in understanding your sales team’s performance, then you should get information from the only perspective that matters-the one who is in a position to write you a check.