It’s Monday morning at 9:00. You are sitting in your weekly pipeline and forecast meeting with your executive team. You spent four hours over the weekend compiling forecast spreadsheets for each of your sales reps and you updated which deals are in commit, likely to close or pure upside based on what your managers have told you and what know about the deals. It’s what you do every weekend. You wish you were spending that time with your family instead and you know whatever you did will only be about 60% accurate.
When the meeting is over and the CFO, CSO or any CXO is done pounding on you about the forecast, you take all of those changes you made and ask your team to go back into your CRM system and make updates (which may not even happen). It’s time consuming, clunky and a waste of precious time. You wonder how you got here and if there is a better way.
Accurate sales forecasting is truly a combination of technology, process and people. The big elephant in the room is that the technology and process part are the easiest to implement – it’s the people part (human behavior) that most companies struggle to manage.
To have accurate forecasting, no matter what technology or process you use, your sales reps and sales managers need to ensure that they are working on the right qualified opportunities, that those opportunities are in the right sales stages, with the right deal value and have a customer-validated close date. Bad data in your CRM system will only lead to bad forecast accuracy. Sales behaviors are directly correlated to bad data.
· 38% of all opportunities in a pipeline are in the wrong stage.
· Pipeline values are over-stated by 40%.
· 22% of a pipeline is consistently being pushed.
· 27% of deals in a pipeline have an expired close date.
Here are a few ways you can improve sales behaviors and curb the elephant in the room.
1. Find the key sales behaviors that are eroding your data integrity. Run a diagnostic that will tell you the critical sales behaviors that impact your data quality. At Marseli, we have a diagnostic application (and a great sales forecasting solution) that our customers use to see how sales people are using their sales process and the impact it is having on their business. To stop behaviors like sandbagging, deal pushing and proper deal valuations, you have to get to the root cause – the sales reps who are doing it and the managers who are allowing it.
2. Plan for change. Once you know the behaviors and can validate the impact, go for change. Start by getting leadership approval and support. Once you have support, run a pilot in a test group. You will have to train front line managers on how to coach to the behaviors. This is your “crawl” phase. Once managers have a handle on coaching to the behaviors (and holding themselves accountable to it). Then move to the walk phase.
3. In the walk phase, you roll the intelligence out to the sales reps in a very simple dashboard. This dashboard will allow them to see the key behaviors in real time and the impact they are having on their personal business. It is this dashboard that reps will review weekly with sales management.
4. After 3-4 months of walking and ongoing coaching to behaviors, then introduce 2-3 more behaviors. Follow the same process as the first 2-3 behaviors that you rolled out. Once these are in the field and being managed, then you can bring forecasting and commitment management back into your CRM. That is your run stage.
When it comes to sales, change is inevitable. As a business leader you want the insight to be able to get ahead of the curve and to know how to react to sales behaviors before they become a problem. Keeping an eye on sales behaviors and the sales pipeline starts with ensuring that your sales process and key activities are integrated into your CRM system and that you are tracking the key behaviors of your sales force.
With a solid sales forecasting technology and process in place (take a look at what Marseli offers), the improvement in data quality through improved sales behaviors will make a dramatic impact on your accuracy and you will no longer have an elephant in the room.