Sales Pipeline Forecasting Is There A Better Way?

To put it mildly most companies sales forecasting just isn't delivering, a staggering 90% of the deals do not close as forecasted even when the close probability is 75% or over. Even more astonishing is that 54% of forecasted deals are lost to competitors or to a no decision.

This is a trend that both senior management and sales management is aware of. And with the visibility now at executive level, sales is creating a demand for more accountability. Interviews with MD's and sales directors indicate that companies can no longer stand idly by hoping the sales team delivers as indicated. Visibility and accuracy need to be improved. And if sales cannot do this we found that the Finance Directors would!

Here is another shared dilemma where we see projected sales are actually a trailing indicator ­ by the time you know if a deal will actually be won or lost the game is over! To this end Sales Directors and MD's are turning to leading indicators in the sales process (e.g. ability for prospect to own product or service, timescale - is it on track, sales team ability to gain access to power etc). Every single metric available is playing an increasing role here as senior management grapple with the challenge of improving forecasting of sales more accurately so they can reap competitive and operational advantage ­ and avoid problems associated with not knowing the true position of the pipeline and just relying on 'gut feel'.

But it's not the same for every organisation; many have used these challenging times to not only clear out dead wood but to build team strength. They are also starting to instil more team discipline. Today we can see Sales Directors & MD's reasserting themselves in their demands for activity, pipeline reporting and adherence to their sales processes. During better times, experienced and even junior sales executives often balked at providing visibility into their activities. 'It's not my style', 'I really don't have time for it', 'I don't believe anyone can tell me what's going to happen' were more easily accepted when sales executives were exceeding targets. But those times for most are now gone. Time and again we found that Sales Directors & MD's have stiffened their resolve. One Sales Director even said:

"We are not dealing in the halcyon days. We are now going to have to do things differently. At the end of each week, you're either doing the things we require or your not. If you are not then you should go somewhere else, because we are going to insist on this and more importantly than insisting on it, we don't want you here if you are not a team player. That's all there is to it. After that, we are going to measure the hell out of this stuff because the fact of life is that we have every right to inspect everything that you are doing and that you are not doing"

To support all of this we are now seeing a noticeable up turn in the number of companies adopting formal methodologies. Whether they create these themselves or licence a commercial offering they are committed to making sure that all their sales staff, start to sell the same way, and that they apply rigor to what they do. In comparing the performance of companies who adopted a formal process versus those that don't, on virtually every metric used to judge success, the processed focussed teams outperformed their less structured competition. In regards to some aspects of selling the differences were absolutely mind boggling.

What we do understand today is that you simply cannot rely on 'gut feel' or any type of 'feel good factor', you have to enforce a practical measurable no nonsense sales process. As a good start you could take a look at your sales funnel and measure key information, however the reporting process seen with many CRM packages will only give you a very basic picture and in certain cases the wrong picture. You should look for a system that is customisable that has multiple 'touch points' within each 'sales indicator'. For example it's no good speaking with a prospect if they do not have an available budget. You usually have to speak to the budget holder and also understand what conditions must exist before they can release the budget. Given this example is it any wonder that many companies don't find this out until it is too late? Lastly it must be easy for sales to complete and sales management to digest so that they can all focus on the areas that still need attention.

Once you have implemented and customised what works for you maybe you can then start enjoying life as you will be able to understand what you work on and what may be worth leaving alone. Now take a look at your pipeline and hold your head up ­ it's so predictable when you know how.

© The Sales Academy 2005. You may include this article in your ezine or on your website or distribute it to others, provided you include the copyright statement and the bio information tag line found at the end of this article.

Michael Palman, a global Master Sales Coach and author. Mike helps people and businesses do ore, do it better and get the results that they want. Mike has had a successful career in sales for over 25 years and now helps other salespeople get the sales edge. Mike lives in both the UK and South Africa.

For more articles by Mike Palman, visit http://www.theaalesacademy.com

---

To Increase Your Sales and Revenue Make Sure To Add Value

What are you and your company's services and products worth... Read More

Sales Plan? Whats a Sales Plan?

In the past, if you said the word "plan" to... Read More

Is Your Forecast Too Sunny? How to Improve the Accuracy of Sales Forecasts

As spring moves to summer, the forecast should be for... Read More

Discounting Your Way Into Sales Oblivion

I don't even like saying the word d---------g. I have... Read More

Sales Tactics to Beat Your Competition

This month I want to share a success from a... Read More

Effective Sales Territory Management

How you prioritize your sales territory management activities depends upon... Read More

8 Line Items of a Trade Show Budget

Budget Guidelines for Trade Show MarketingB'techa didn't know - Trade... Read More

Seven Deadly Sales Mistakes That Cost Business Owners Big Money - And What To Do About Them

1. LOOKING for a "quick fix" to close more sales... Read More

Speed-up Your Sales Cycle

This week's article is my response to a question by... Read More

Small Business Marketing: Overtaking Your Competitors

Few businesses keep tabs on competitors, yet such knowledge can... Read More

Producing Premium Performance

One of the major issues that arises in managing a... Read More

Overcoming Sales Objections for Small Business Networks

Do you need help overcoming sales objections? Do you sell... Read More

Profitable Relationships: Is It Amateur Hour or King of the Hill?

"We're in the relationship business?...airplanes are what we use to... Read More

Commodity Sales Prospecting - How to Stand Out From Your Competitors

I have received a number of requests for advice from... Read More

Increase Your Sales - Accept Credit Cards

Many people today simply prefer the convenience of paying by... Read More

The Get Dangerous Quickly Approach to Product/Service Training

In 2000 a computer distributor hired me to help them... Read More

The Top 5 Issues Facing VPs of Sales

A recent study of 2,663 sales organizations by Think Training,... Read More

Sacking Clients: Brand Power Wheel

Remember in the last message we talked about your directional... Read More

Change in Sales Organizations Starts with Me

Question: What do the following have in common?- I spend... Read More

A Coachs Handbook For Sales Managers

This article may be reprinted in its entirety with express... Read More

Ten Awesome Ways To Incease Your Sales In Holidays

Everybody thinks that the businesses will slow down a bit... Read More

Sales Pipeline Forecasting Is There A Better Way?

To put it mildly most companies sales forecasting just isn't... Read More

Increasing Business Through Distributors

You're a small company with a good product. You are... Read More

Energize Your Organization

No matter what you do, it seems, your employees do... Read More

The Surest Way to Boost Sales

If you have a small business and you are looking... Read More

The Art and Science of Managing Expectations in Selling

It is very easy to fall into a trap with... Read More

Rotten to the Core: The Story of How the Best and Brightest can be Ruined

The objective of an incentive is to incite action within... Read More

4 Marketing Myths Threaten Your Sales

These 4 marketing myths can cause you to lose sales... Read More

Sales Marketing: 12 Sneaky Tricks To Help You Outsell Your Competition

Business can be like war sometimes.You may have to fight... Read More

Building Trust For Lifetime Success

Trust.One word.One very powerful word that can increase both first... Read More

Sex, Drugs, & Rock-n-Roll at Trade Shows

Here's the Scenario...You're at a trade show. Out of town.... Read More

How to Keep Projects From Spinning Out Of Control

Are you involved in projects that seem to go nowhere... Read More

Sales Coaching... Fact or Fiction?

The old adage in selling has always been, "Find out... Read More