In this article, I am going to address the issues that is sales forecasting…
I’ve been in sales a while now. Initially as a salesperson, sales manager, sales director and for the last 17 years as a speaker, consultant and coach.
Many things have changed…
When I first started we did not have computers on our desks, only a handful of people had mobile phones, the internet was on dial up, and you still needed a camera, a chess machine, a games console, a Filofax, a Walkman, a map, etc… not just a phone!
But many things have stayed constant…
Sales is competitive, a small percentage of salespeople win the majority of the sales, managing salespeople is hard, and getting accurate forecasts out of them about the likelihood of their deals closing is nigh on impossible!
Let’s face it, sales forecasting is a nightmare.
No, it’s harder than that; it is like herding cats.
People often say to me, “Why did you leave sales if you were so good?” And I say, “I never said I was so good and I have not left.” I still conduct ALL of my own sales. Every gig I speak at, every #IAM10 programme I sell, every director’s coaching assignment I undertake – all sold by me. I still get the highs and the lows of selling and I still get how we can all make excuses and be subjective rather than objective when trying to forecast our sales.
I was speaking with a CEO group the other day and we were talking about the critical importance in your business of having accurate sales forecasts and ways to get them and we all agreed on the following…It is easy to accurately forecast a well qualified opportunity and impossible to accurately forecast a poorly qualified opportunity. #IAM10Click To Tweet
The big differentiator – sales forecasting based on accurate information rather than on the salesperson’s overly optimistic version of “pin the tale on the donkey”.
There are many reasons why this is hard:-
- Salespeople think that they do not have the time in the day to do it.
- They do not know how to do it.
- They have not got the skill set to do it.
- They have not asked the right questions of the client in the first place.
- They have had insufficient training.
- They are under-pressure and are playing fast and loose with their forecasts to try and keep the grim reaper (that’s you, by the way) at bay.
- The sales leader does not know how to forecast properly.
- The sales leader is too “close” to the individuals and their deals and not being objective either.
- The sales leader does not have the sales skills or the assessment skills (and even if they do, they cannot possible recheck every deal).
- I could go on… and on… and on… feel free to add your own reasons why sales forecasts fail…
Bottom line, with the average sales team consisting of a sales manager and 8 salespeople each pursuing 7/8 deals, the sales manager doesn’t have enough time to dig deeply enough into every deal to ensure that they are fully qualified. Consequently, the sales manager is forced to rely on the salesperson’s judgement as to whether or not to forecast a particular deal.SALES FORECASTING = HERDING CATS. #IAM10Click To Tweet
And let’s face it, with your experienced (and successful) salespeople (20%?), this should be relatively painless but for the rest…
I talk in my ‘I am 10’ strategies about ‘brutal honesty’ and the importance of being honest with yourself – about your skills, your sales, your business, your relationships, your health, your finances etc. This is one are where many sales leaders could do with being more honest with themselves…
Most sales forecasts are little more than best guestimates of what might happen.
So, what should you do…
Make sure your salespeople know how to sell effectively in the first place. There are far too many salespeople out there who barely even know the basics of selling. If you do not have ongoing sales training for your people, then you are holding your sales and your business back.
Give them more information on what specific information they need to truly qualify a deal. It is amazing how many time even the most basic questions about budgets, or decision makers or timescales elicit the response, “Well, obviously…” or “I think…”. And that’s before you start on the more detailed ones for forecasting the kind of complex deals that many of us are involved with in today’s competitive markets.
Your teams need coaching to help them to install and maintain their standards. You cannot expect to do one training session on selling, or even a programme, and everybody adopt it effortlessly. You need to help and support them.
Sales leaders are perhaps even more sporadically invested in than the people that they are managing. You wouldn’t leave an untrained accountant in charge of your business so why leave an untrained sales leader? It just makes no sense.
Here’s an interesting statistic…According to CSO Insights less than 50% of all forecasted deals close within the quarter they were forecast do so. #IAM10Click To Tweet
Time to have a look at some of the above?
I think so. And if you want to have a chat about creating a high performance sales culture, then give me a call on 0845 838 5958 to organise it.
And, whilst you’re thinking about that, get yourself a coffee and have a look at this. You know me, I never recommend things but I am taken with the value that this one can add for the right team (and you can try it for free!!).
For the last few years, I have been chatting to a rather nice man called Mel who has made it his mission to help sales leaders better forecast their sales. He has created an online tool that will inform you how well a deal is qualified. It’s free and, perhaps more importantly, it’s completely anonymous – you do not have to put your email in or anything to have a play (although, when it gives you the initial results, I would because it then gives you more…).
The analysis will provide you, the salesperson and any C-Level Executive with a snapshot of the sales person’s status with an opportunity. The analysis is based on what the sales rep knows about the deal and their actions to date in moving it through the sales process.
When completed you will receive an Analysis Summary which shows…
- How well the opportunity is qualified (Degree of Qualification).
- The chances of winning the business.
- The chances that the deal will close by the close date.
- The sales representative’s strengths in 6 critical areas.
I have run a couple of my opportunities through it and I think it’s accurate. Infact, on one of them – that I knew I had been a bit “lazy” with – it gave me a digital kick up the arse! So much so that I had to pick the phone up to the client and ask some of the questions I had “skipped” in our last conversation.
Anyway, get your coffee and your biscuit and have a try… you have nothing to lose and everything to gain.
So, that’s about it from me for this issue – have a great day and a great weekend and be a ’10’.