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By Gerard Sternesky April 16, 2019

Want Forecast Accuracy? Get to Know Your Sales Information System

In parts 1 and 2 of this series, we discussed the importance of getting to know your client base from a variety of perspectives and using that knowledge to design a sales process that is aligned to their buying process.  In this part, we’ll discuss how to set-up your sales information system in a way that promotes forecast accuracy.

Part 3: Want Forecast Accuracy?  Get to Know Your Sales Information System.

In part 2 of this series we mentioned that salespeople are in many ways like detectives working in reverse to reveal the facts of an event (in our case, the sale of your company’s goods or services) that has yet to take place.  Like any good detective, then, your salespeople must be able to record, consider and deal with many individual bits of information.  Some of those bits will prove critical in determining their success or failure, while others will have little impact.  How, then, should you go about designing a sales information system (SIS) that will maximize your team’s sales forecast accuracy?

If we start with the sales process itself, we can agree that every step in that process should be intended to help move the process closer to a sales transaction.  Every action your reps take should thus add value to the sales process by increasing the likelihood of a successful outcome and, if possible, by decreasing the time required to achieve that successful outcome.  Anything else is just wasted effort. 

There are two primary ways in which your reps add value to the sales process.  One is by achieving what we refer to as a desired state of being or condition regarding the client’s relationship with your rep.  For instance, does the client view your rep as a trusted advisor who can be counted on throughout the sales cycle and beyond to provide valuable, honest information about your products or services and their ability to truly meet the client’s needs?  Has your sales rep successfully established a compelling business and financial case for doing business with your company?   Is your rep’s primary contact willing and able to champion your company’s products to his or her internal stakeholders, if necessary?  If the answer to these questions is yes, your rep has achieved a desired state of being or condition, one that is likely to increase his chance of success.

The second way in which your reps add value to the sales process is by accomplishing key milestones.  Too many sales teams track milestones that are either too internally focused or are simply tasks, not milestones.  The rep delivered a quote; the rep delivered a statement of work; the rep prepared an analysis of the client’s current processes and the pain points associated therewith.   Although some of these may in fact be table stakes if your company is to ultimately win the deal, your rep’s completion of them will by itself not increase your likelihood of a successful outcome.  On the other hand, not every vendor is typically invited to conduct a pilot test or a proof of concept, so these can certainly be considered sales milestones that should be tracked closely.  As we have said elsewhere in this series, when deciding which milestones to track in your SIS, check with your clients to be sure your sales process is in alignment with their buying process, particularly around what they see as key accomplishments they expect the winning vendor to achieve. 

Finally, when designing your SIS, pay attention to what we call the five C’s of sales information systems:

  • Culture: Let there be no doubt about it, you will never achieve forecast accuracy if your SIS is not supported by a culture that requires all essential information to be tracked in that system. The greatest advances in forecast accuracy, regardless of the size of your organization, will come when sales leadership makes clear that “if it’s not in the SIS, it didn’t happen or doesn’t exist.”
  • Consistency: As with athletes, actors, musicians and just about everyone, sales reps do things best when they do them consistently. If your sales managers use the SIS inconsistently, your reps will, too.  Make sure your sales managers use the SIS to manage their reps on a day-to-day basis.  Make sure they use it regularly to perform their own quality assurance on the reps’ data before you use it for your purposes.
  • Corroboration: One way to maximize the overall quality (and, hence, the accuracy) of SIS data is to use multiple data points in a complementary manner. For instance, in addition to tracking each opportunity’s movement from early stage to late stage, track your rep’s success in developing a relationship with the client’s decision-maker.  If your rep’s relationship with the decision-maker is immature or not developing, why should you believe the rep’s prediction of when the deal will close or whether he will win it?
  • Connection: This should be obvious, but we see a surprising number of clients who track data points they never then use in their analyses of sales results and how to improve them. In most cases, the sales reps know this, and so they grow to resent having to enter data that no one will ever use.  Remember our focus on the outcome of the sales process, the transaction?  Make sure you can connect every data point you track in a meaningful way to the transaction you are pursuing.  If you would never use that data point in analyzing your team’s success or failure, don’t track it.
  • Complete: Even the most sophisticated sales information systems we’ve seen are limited in the types of reports and analyses they can deliver completely within the confines of the system. While it’s tempting (and initially faster) to overcome these limitations by downloading data and creating offline reports and analyses, these almost always become very burdensome to maintain over long periods.  Design the system so that every stakeholder can get whatever report or analysis he or she needs by using the capabilities of the system.  While this may delay the rollout out the SIS, this practice will help ensure the overall integrity of the system and motivate everyone to become expert in its full capabilities.

In Part 4 of this series, we’ll discuss the importance of the forecasting process itself in contributing to greater sales forecast accuracy.

Any questions, please feel free to email SRi at emorse@salesresult.com, or check out our website at www.salesresult.com. For more information, please download the e-book on CEO guide to a winning sales organization.

Topics: Sales Process, Sales Operations, Sales Planning, Forecast Accuracy, Forecasting

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