Most businesses are challenged with accurately predicting the future in terms of competitive threats, customer trends, and their own sales forecast. Sales leaders admit that accurate and efficient sales forecasting is fundamental to making good business decisions, whether it’s prioritizing customer focus, adjusting sales coverage, or making account and deal-based pricing decisions.
Connected planning platforms, like Anaplan, address these challenges by changing the sales forecasting environment. For instance, if a territory is re-drawn or reps are re-assigned, these changes are reflected instantaneously, and sales leaders can adjust forecasts as needed, even in the middle of a sales cycle.
According to market research, companies that adopt leading sales forecasting methodologies find approximately 20 percent improvement in forecast accuracy, helping them to achieve as much as a 7 percent year-over-year increase in deal size and strong improvement in sales cycle time. These methodologies include: organizational coordination, automation, reliable data, and analytics-based decision-making.
Below are the four ways to get your company on-track to successful forecasting:
Collaborative – Leaders should seek rapid and easy-to-gather data, and synthesize input from a variety of sales roles, business units, regions and data sources. The frontline teams are of great value—they may provide you with a real pulse on the market you hadn’t considered before.
Real time – Investing in real-time capability to course-correct or reforecast allows sales leaders to quickly gain insight so they can make more informed decisions. It enables them to quickly and accurately update the forecast based on demand or market changes.
Single-truth, multiple views – Enhance visibility into rep, region, and company performance, and better align different business functions across the organization.
Data-driven – Leverage predictive analytics to reduce the impact of subjectivity, which is often more backward-looking rather than forward-looking. Using common data definitions and baselines will foster alignment and save time.
The key is to learn over time and update your goals based on the new insights gained. Those companies with better forecasting processes and tools generally outperform their competitors because they better understand their business drivers and can shape the outcome of a sales period before that period is closed.
Rowan Tonkin is head of sales and marketing solutions at Anaplan, which provides a planning platform that connects data, people, and plans in every part of your business.