Is There a Silver Bullet to Forecasting Accuracy?
- June 24, 2019
Siebel promised the CFO that “our software will tell you if you are going to make your number or not”. That was more than 39 years ago. And with more than 79% of the companies still missing their forecast by more than 10%, that promise is still unfulfilled. This is a central question that affects every VP of Sales especially as the VP Sales tenure has shrunk to 18 months.
There are many reasons for the forecast misses, ranging from rolling hairball deals, overly optimistic reps, aggressive forecasting and hockey sticks.
Historical weighted averages are a good approximation but what do you do when you have a new sales motion, a new playbook, a new product to sell, new competitors or new sellers?
Let’s start with a hypothetical, which is that the VP Sales needs to be in every single sales deal. As ridiculous as that sounds, why should that lead to a more accurate forecast?
It is simple. When the VP sales is in each deal, she knows exactly what’s going on, and has a strong grasp of the prospect’s buying intent and urgency. She knows the issues, she knows if the seller is dealing with all the right personas, she knows who is positively disposed, who are the detractors, how the last call with IT and Security went, etc.
When you are physically in the deal, the content and risk in the deal are obvious. When you are not, the deal content starts to get murky. Sellers have their own version based on their past experience, maturity, personality and tenure. And as a sales leader, you have no choice but to rely on your seller’s POV.
Sure, you can put MEDDIC in practice. But the reality is, there are far too many nuances to a deal for any methodology to capture.
Since you can’t be in every single deal, how do you get to accurate forecasts?
The only reliable way to predict if a deal is going to close or not is to actually examine the content, the words, the questions and issues expressed by prospects in various communication channels like voice, email and calendar.
Unfortunately, there is not enough time to read every email or listen to every call, and the summary of this deal content is not in the CRM.
At BoostUp.ai we believe there are 4 dimensions for forecast risk —
- Sentiment risk: objections from key stakeholders in late stages.
- Relationship risk: Single threaded, weak relationships, over-reliance on champion, weak relationship with the current buyer role.
- Dis-engagement risk: Senior titles or relevant buyer personas not engaging substantively over email and meetings.
- Out of sales process risk: Key topics not discussed, key actions not completed on time.
But the digital markers of these risk factors are not in the CRM.
They are buried in LinkedIn, seller’s inboxes, email content, call transcripts, calendars, slack, content engagement and such.
BoostUp.ai indexes & summarizes these digital markers of risk and gives you an automated score card for every deal in your pipeline and forecast.
While there is no single magical silver bullet, analyzing all 4 dimensions of risk for each forecasted deal will get you away from opinions and into the world of truth.