How to Overcome Your Biases in Sales: A Guide.
The Dunning-Kruger Effect
In the world of sales, confidence is key.
But what happens when confidence crosses into overconfidence?
Welcome to the Dunning-Kruger effect - a trap we all fall into from time to time where the less you know, the more confident you are; and vice versa.
It's like walking on a tightrope blindfolded, thinking you're on solid ground.
It’s a phenomenon that can rear its ugly head in all kinds of ways, especially in a sales context. I’ve seen it.
Let me tell you about a time when a seemingly ‘perfect deal’ taught me about the Dunning-Kruger effect— and gave me a hard lesson in how to forecast pipeline more accurately.
The Perfect Deal? Or the Perfect Illusion?
Picture this: I'm an Account Executive (AE) working on one of my first enterprise deals, the kind that's more than just a number. We're talking 6 to 7 figures, and the stars are aligning. My Point of Contact (POC) is an incoming product manager, fresh in his role and hungry to make an immediate impact. He'd been the champion of our solution at his previous company - a feather in my cap, or so I thought.
Their pain was real: a product powered by third-party solutions that were outdated; UX was a mess, status quo was churn and awful conversion. Meanwhile in head-to-head tests our solution eliminated their UX issues and closed the gap on performance. We had the answer to one of their most pressing needs. Yet another feather in my cap, I thought.
"This is a sure thing," he assured me, and I lapped it up.
“I’m presenting to my boss next week.” Great! We have momentum, right?
But I was overlooking a crucial piece of the puzzle...
Cue the reality check.
During deal review with my manager, I confidently pegged the deal as closing in the current quarter— with the highest probability I could assign. I listed my reasons: my POC's enthusiasm, his past experience with us, our head to head performance. It seemed pretty clear-cut from my perspective, and I had helped my POC build the case from the ground up.
Then my manager hit me with: “What do we know about your POC's boss?”
I was red in the face. I knew nothing.
Are they the final decision-maker? What are their priorities? How does this project rank for them?
I didn’t know.
I’d been viewing the deal through too narrow a lens, fueled by overconfidence and my own desire for a big win.
Suffice to say it was not a pleasant meeting with my manager.
Turning the Unknown into the Known
So I did what any endeavoring AE would do: I poked the unknown.
I called my POC, and together, we secured a meeting with his superior. It was during this call that a new proposal emerged to bring other key stakeholders into the fold. It turned out to be a pivotal moment.
Doing this unraveled layers of decision-making dynamics we never could have gleaned from my POC alone.
Despite these breakthroughs, the deal didn't close that quarter. Admitting this wasn't easy; it required me to set aside my ego and acknowledge the extended timeline. Yet, I could accept this reality with newfound confidence.
Why?
Because we worked our way up the chain of command and not only aligned our timelines but had gained a seat at the table. In essence, we transformed a critical 'unknown' into a strategic 'known.'"
This was one of my first dances with the Dunning-Kruger effect as a sales professional.
I was swayed by my own perceptions and overestimated my understanding of the situation, but the experience taught me a valuable lesson in the rigor of forecasting pipeline.
Conclusion
Accurate forecasting is as much about understanding the nuances of each deal as it is about recognizing our own behavioral biases. And the Dunning-Kruger effect is a good reminder of this: overconfidence can cloud your judgment. Confidence is valuable, but overconfidence without a complete picture can jeopardize a deal.
Here’s a few things to keep in mind as you consider your approach to forecasting pipeline while managing your biases:
Be ruthless in acquiring an understanding of the decision-making process.
Work towards gaining an encyclopedic understanding of how projects get green-lit, and how every single penny is accounted for. If there's any aspect you're not clear about, your homework isn't done. Knowledge like this is crucial for anticipating potential obstacles and aligning your efforts accordingly.
Question Your Assumptions:
Regularly challenge your own beliefs and assumptions about a deal. Ask yourself: What are you taking for granted without solid evidence? Honing this mindset will sharpen your ability to anticipate and to navigate your deals. Here are a few additional blind spots to be aware of:
Assuming your POCs enthusiasm equates to a closed deal; Overestimating urgency or priority.
Failing to recognize your competitor’s influence on the customer’s decision-making process.
Failing to recognize the customer can choose to do nothing.
Acknowledge what you don’t know.
Be forthright about uncertainties. This honesty might feel like dousing your forecasts with cold water, but it’s a practice your manager will likely appreciate for its candor. Acknowledging uncertainties helps in developing a more realistic and reliable forecast. It's better to be pleasantly surprised than unpleasantly blindsided.
What are some biases you've uncovered about yourself that have impacted your sales efforts?
