Closing a Sale is a matter of probability beyond our control... Right?

Lately I have been documenting myself with theory about stock investment and trading. Numbers and statistics are one of my hobbies. The one interesting thing is that when you go into the theory on how an investing or trading system works, you realize that it all works ultimately by the numbers, and the system that works is one that gives you good possibilities to make a profit.

From what I know, people who tend to think that trading, or investing are basically dependent on luck, hunches, gut feelings and so forth, basically don’t trade, or to be more precise, at some point they stop trading. Who wouldn’t? The perception of betting in something that is beyond our control and understanding is too high a risk as to put our money in it.

Then you have people who understand that you can apply some science to trading and investing. And they are right. However, occasionally their approach is wrong. They understand why they win when they win, but not vice-versa, and as we love to have things under control, there is so much stress associated with a trading system that loses money –our money- in and out. What I think is the wrong approach is stating that a system does not work if it doesn’t win 100% of the times.

I learned from a very renown investor that in his statistics, the people that are more successful in the markets, actually lose money in some 60% of their trades. Obviously the 40% winning rate makes the profit.

This single data led me to the conclusion that, actually you apply science to trading not to win 100% of times, but to be successful and keep trading.

This means that when you design your own trading system, and you are serious about it by doing the right thing and apply science to: the more you research, the more relevant and high quality information you get, and the better your system works with highs and lows, the more probabilities you have to succeed, especially in the trading markets when your own money is at stake, but also in other walks of life you intend to be serious about.

Since this blog is mainly about sales stuff, let us talk sales:

Let’s say you have a goal in your company of starting a sales campaign to go into a new geographical area. Fine, what you learned at school and seminars, and what you have done before is you go think, design, plan, and execute your actions to succeed in that market. Right?

Wrong! You design, plan, and execute in such a way that you INCREASE your possibilities of succeeding in it. Maybe you thought it through or not, but every component in your plan is aimed to cope with at least one variable, that is, to control it, in a way that the ratio to success increases here and there. Now we can imagine how every detail in your system moves percentages, numbers and ratios in front of our eyes. Our brain is a computer you know, we all can think in terms of numbers even though our culture favors more words and images than rates, or maybe it is that I undertook human sciences at the university, and had to rediscover my fondness of numbers later.

Anyway, are we making sense? Knowing this, would you plan differently in your next project or sales campaign? Is that aspect you are so stubborn about in your plan really increasing your numbers of success? In what ratio? Is that input you consider “way too expensive” decreasing your numbers of success?

The point is, assigning numeric values gives us a different perspective on things, one more objective. Assigning numbers is measuring, and it is commonly said that to improve something you have to start by measuring; which is the over-simplified explanation of the continuous improvement concept: incremental little% changes. The truth is that a plan with assigned numeric values is very easy to understand, share and interpret. And this is the magic of numbers, they speak, even more eloquently than words.

Now then, if all variables in your Sales Plan had a value, what would be the summation?? Would it even positive? Would it show you flaws in your plan? Wait a minute, if you showed and discussed this values with your colleagues, with experts, would they agree with the values you assigned? One of my former supervisors used to say: what would your favorite guru think about this? (No, we are not getting mystic here, your guru could well be Steve Jobs, Gandhi, Carlos Slim, or Neo from the Matrix…)

So, if you are an entrepreneur, a sales manager, a project manager, or you have any position where you have to plan and execute, but don’t have much experience with it, or feel that your system may be improved, try playing more with numbers, there is a probability that you will start liking them more.