One of the critical tasks that starts from our first day in sales is proper forecasting. As managers the way we handle this efficiently, honestly and accurately will directly tie-in with how we are perceived as an effective sales manager by the senior leaders of our company.
- Early in my sales career, I remember submitting a forecast for an account that would have been one of the largest I'd ever gotten. I sent details to my manager, the marketing team, and the person who consolidated all of the forecasts. It was listed with all of the other projections, with the dollars fully visible for all to see. For our purposes, let's say it was $100,000. The following month, the sale was closed and I was sky high. However, because of a budget issue, the customer cut the order from $100,000, to $90,000.
I was excited, but I sensed a bit of disappointment from other departments who were expecting the original revenue forecast. I can remember well other sales representatives saying to me, Dean, never forecast the full amount you're expecting. Thus began a sequence that all of us in sales know quite well and that's the forecast that's not really a forecast. Today, managers, directors, or vice presidents of sales now have some excellent tools for forecasting or business.
Frankly, with the marketplace so competitive and our company so focused on profitability, we could no longer have sales forecasts that are not more accurate than how we did them years ago. We need to be submitting projections that are timely, realistic, and accurate. With our channel sales plans we know that some channels will be more predictable than others. That will always be true with some of our partners, distributors and sales representatives. Over time, good sales managers get a feel with how certain people forecast their business.
As with anything, some are more bullish and optimistic while others still hold back out of fear. However, if we're to analyze and understand our channels properly, we need our partners and sales people to feel comfortable working with us to submit the projections that are close to the mark. I think the use of CRM's has made forecasting so much easier, smarter and more accurate. There so many benefits to a good customer management system but the ability to have real-time forecasting is one of the great features.
All of it must start with your commitment as a manager to require all of your sales people in each of the channels and those working with channel partners to enter forecast information in a timely way. You need to model the way by letting them know how important accurate and honest sales projections need to be. I'd recommend spending the time during staff meetings or other sessions to show how you use their information to create sales forecasts that are given to financial teams and a senior management.
What I especially have liked about most CRM's is that you can wait a sales opportunity. For example, a sales person can say that a sale of $50,000 may have a 25 percent, 75 percent or whatever percentage of closing. This way, instead of having just one number, as a manager, you can gage the heartbeat of your sales team by the way they have waited each sales opportunity that they're working on. They can update these percentages throughout the sales process.
You can also create dashboards with sales forecast data from your CRM. These are great tools not only for you to monitor your sales but for you to easily review the numbers with others. Years ago, forecasting was a lot of juggling of numbers that were oftentimes 50 to 20 percent or more off the final result. However today, with the great tools at our disposal, we're able to more efficiently and more accurately forecast sales. Managing a complex sales channel strategy requires that managers be on top of the sales projections we provide and recognize the critical impact it has on managing our business.
- Surveying the marketplace
- Reviewing channels
- Managing channels and investments
- Developing a go forward plan
- Working with other departments and teams
- Handling channel conflict
- Forecasting sales
- Creating a channel marketing structure