Sales management for rapid scale
FORECASTING
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No one likes surprises
Most sales metrics are lagging. Clearly, finding out that the business has written a "sub-optimal" month of revenue at months end is too late. So don't you want to know where your business is going?!
Leading metrics that are predictable and reliable enable accurate forecasting which are important for managing resources, investment decisions and stakeholder expectations. By using a combinations of historical, current and qualitative references, a good sales manager should be able to predict end of month, quarter or year performance at any given time.
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Once mastered, financial planning, recruiting, territory planning, the setting of sales quotas and measuring performance all become much stronger.
1. Project circle
Sales team members may not be the only ones required to participate in accurate forecasting. It's important to involve cross-functional leaders such as finance, marketing and even operations to ensure alignment.
2. Analyse your market
What are your total addressable, obtainable and serviceable markets? Balance the size of your markets with the competition. Is it better to achieve greater saturation in a smaller market? Understand internal and external trends and trajectories.
3. Collect data
Past sales data can be a fair predictor of future performance if it's clean (e.g. distortion free, uncorrupted and accurate). Visualising the data will help remove or explain outliers.
4. Forecasting technique
The confident characteristics of your successful sales staff are the same characteristics that often result in bullish forecasts. The best forecasts rely on qualitative and quantitative data. Blending best case, "commits" and best guess help narrow in on accurate forecasts.
5. Testing
Assess the accuracy of your forecasting techniques against 1. historical data, 2. your most recent reporting period and 3. "the rollover" technique. Adjusting and refine to improve your forecasting accuracy the executives acceptable margin.
6. Deliver
Select your channels, forums and audience for your forecasts and get them clearly communicated on a regular cadence. Vertex is a big fan of live dashboard and can help your teams communicate forecasting and performance data in engaging ways.