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Sales Forecasting Accuracy: Two Questions You Must Answer

alt text for a man covering his eyes and throwing a dartSalespeople and sale organizations are notoriously bad at forecasting. A quick glance at the pipeline will most likely present a picture of lots of opportunities at various stages of the sales process, all of which are assigned some percentage that indicates the likelihood of that opportunity closing.

Regardless of the worthlessness of some metrics, forecasting can be a valuable exercise for sales managers and even more valuable for salespeople. These two questions will do much to make sure you are where you think you are, and that you know how to move your opportunity to where it needs to go.

Have I Obtained All of the Commitments Necessary to Forecast This Opportunity?

A sales process is made up of activities that must completed to move an opportunity from it’s opening to it’s eventual close; it is a roadmap. At each stage of the process there are commitments that your dream client must agree to and keep in order for you to move the opportunity through the process.

Would it were that easy. Ask this question, “Have I obtained all of the commitments necessary to forecast this opportunity?” If you have missed commitments that are earlier in the sales process, if you have missed capturing information or gaining access to individuals within your dream client’s company, you are not ready to forecast this opportunity with any accuracy.

“But wait,” you say, “I have accomplished most of what is in one stage and most of what I need in the next stage. And I already presented.”

Here is the thing, by failing to obtain the crucial and critical commitments that indicate that you have successfully advanced the opportunity, you have destroyed your ability to forecast that opportunity with any accuracy.

Asking this question can help you determine with how much confidence you can accurately forecast your likelihood of winning.

And what if you missed some commitments? Not to worry, your sales process is not linear, despite its appearance as codified on paper. You can go back over some of the ground you covered to pick up what you missed.

What Commitments Must I Obtain Between Now and Closing?

Between your opportunity’s present place in your sales process and closing, there are other commitments that must be obtained. If you have a solid, effective sales process, you will have these commitments at hand.

Selling is a messy game, and it isn’t always as simple as simply checking the boxes. Sometimes certain actions have to be taken that don’t appear in your sales process. Sometimes additional information is needed, and additional commitments may need to be obtained. Sales is much an art as it is science, and recognizing what needs to happen to move your opportunity is part of the art.

Your sales process may not include a step that suggests that your Regional Vice President make a call to your dream client’s Regional Vice President to ask for access to someone on his team.

It is equally unlikely that there is any process for nurturing a relationship with a stakeholder three levels deep in the organization, one with no formal authority, but with enough influence to derail your opportunity or destroy your solutions chance of succeeding.

There are no sales processes I have seen that contain the coffees, the lunches, the introductions to vendors and partners, the informal phone calls, the emails, and all of the other communications and commitments that grease the skids of your opportunity and move it forward.

That aside, you have to identify those commitments and take those actions if you are to win your dream client. If you are to forecast it with any reasonable accuracy, you have to account for what needs to be done between today and the date you have entered in your sales force automation.

Questions

  1. Look at your pipeline and your sales forecast. Are there opportunities that you have in a stage of your process that have commitments that needed be obtained in earlier stages but were missed?

  2. How does missing some of the commitments to obtain access to the individuals you need to meet with within your dream client’s company reduce the likelihood of you successfully winning your opportunity? How does missing the information you needed to propose the right solution and to ensure its success destroy the likelihood of you winning or succeeding should you win?

  3. Look at your opportunities. Pick the best one. What has to happen between today and the date you have forecast this opportunity to close? What actions do you need to take to obtain those commitments? Which commitments will you need assistance from others on your team or your dream client’s team?

  4. What commitments do you need to obtain that don’t exist on your sales process roadmap?


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Filed under: Sales 3.0

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