Fixing Forecast Accuracy: Joint Webinar with Sales Management Association

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Fixing Forecast Accuracy

The quest for the holy grail of sales confidence!


Tim BramanRevegy, Inc.VP of Corporate Strategy


Deal Outcomes – Forecasted Deals Only

CSO Insights, Inc. 2013 Sales Performance Survey

48.6%

47.4%

46.5%

27.3% 26.1% 24.2%

46.8%

30.3%

All Companies Use CRM


Poll

What tool do you use for forecasting?

- SFA (Salesforce, Microsoft, Oracle, SAP, etc.)- SFA plus Excel- SFA plus Forecasting Analytics tool- Excel only- Other


Today’s Agenda




The Smartest Guys in the Room

•Sirius Decision – Jim Ninivaggi•CSO Insights – Jim Dickie•Forrester – Scott Santucci•Aberdeen – Peter Ostrow


Context for Today’s Discussion

$$$


It Isn’t Easy…

Challenges with Forecast Accuracy

We don’t

really have

a process…

Our target market is

EVERYONE!

Tactical vs. Strategic SolutionBuyers

EngageLater

Big vs. Small

Prospect


Poll

What is your biggest problem with forecasting

- No common language/process- Sales Representative forecasting skill/knowledge

- Lack of insight to customer behavior- Lack of Management inspection/coaching- Don’t have appropriate tools- Other


46.8%


What is “Good” Forecast Accuracy - Top 20%

90 Days 60 Days 30 Days Immediate

66%

76%80%

84%

Aberdeen Group : “Sales Forecasting Research Benchmark”

- On-time?- Amount ok?


Why care about Forecast Accuracy?

Quota AttainmentSales Cycle Reduction

17% 10%

Top 20%

3% 0% 6%

7%

Middle 50%Bottom 30%Aberdeen Group : “Sales Forecasting Research Benchmark”


Forecast with Confidence – The Five Pillars


Forecast with Confidence – The 5 Pillars1. Ideal Customer/Qualify


Who is your ideal Customer?


Ideal Customer/Qualify

Case Study: GE Finance• 3X win rate increase• 10,000 New

Harvard Business Review, The New Science of Sales Force Productivity


Ideal Customer – Qualify the timing

Win Rate 17%

CSO Insights, 2013 Global Sales Performance Optimization Study


Forecast with Confidence – The Five Pillars2. Sales Process


Stage(SFA-%)

Identify(Lead – 0%)

Qualify(D – 25%)

Develop(C – 50%)

Proof(B – 75%)

Close(A – 90%)

Objective Is this a prospect? Is there an Opportunity? How do we help? Prove our Value Get Ink!

Critical Success Factors

• Validate customer’s current business challenges and key initiatives

• Understand customer’s landscape and our potential partners

• Determine key stakeholders, evaluation criteria and decision-making process

• Develop latent pain /use Challenge/provocation message

• Conduct initial executive meeting

• Confirm executive commitment and critical success factors

• Identify competitive landscape

• Determine potential solution fit

• Develop initial sales strategy with account team & management

• Conduct discovery workshop

• Develop our unique value propositions (UVP)

• Confirm solution fit with key stakeholders

• Create solution presentations and demonstrations

• Test / Refine the solution presentation with our Coach

• Present OUR solution to key decision makers

• Integrate implementation, training and support teams

• Provide references or conduct POC

• Submit value-centric proposal

• Confirm final decision process and timing

• Gain customer commitment and finalize legal agreements / timelines

• Obtain internal approvals

• Process Contract/Purchase Order

• Conduct transition meeting with Professional Services and support teams

Sales Process


Discovery QualificationSolution

Development Short List Selected

Qualified Opportunity

Signed Agreement

Solution Aligned with Customer Needs

Selected as one of FinalistsDemandGeneration

Stag

eG

oal

Defi

nitio

nTo

ols

Mile

ston

es

Sales Process

• BDR pre-qualifies from

marketing campaigns.• BDR and AE prioritize Top

Prospects• BDR sets up further

qualification and discovery calls.

• BDR and AE identify key stakeholders

• Contact prospects and customers to qualify budget process, time-frame, decision-makers and influencers, decision/ procurement process.

• Team gathers information to understand customer’s objectives.

• Further qualification of key decision-makers/ stakeholders, buying criteria and technical requirements.

• Professional Services engaged.

• AE works with team to develop the solution

• Create customer-centric demonstration

• Conduct demonstration/presentation

• Create proposal and customer

• Review proposal with key stakeholder

• Validate Short List• AE and team make final

proposal adjustments • Conduct necessary ‘Proof’

activities• Reconfirms customer’s

decision and procurement process.

• Negotiate Business Terms• Gain internal stakeholder

approvals (legal and finance)• Manage customer

procurement cycle• Identify potential risks• Obtain contract signature and

Purchase Order

• Territory Plan• Account Plan• Ideal Customer Profile• Marketing Campaigns

• Value Message • Qualification Checklist• Whiteboard• Call Plans

• Whiteboard• Overview Presentation• Win/Call Plans• Value Map• Joint Evaluation Plan

• Demo Scripts or Standard Presentation

• Opportunity Win Plan• Value/Relationship Map

• Proposal Templates • Joint Evaluation Plan• Opportunity Win Plan • Value Map• Statement of Work

• Contracts• Statement of Work• Implementation Plan

• Lead generated by BDR, AE and/or AM

• Or, Marketing scores the lead (0%)

• Opportunity identified

• Or evaluation is underway

• Project is funded

• Value Map Completed

• CSF’s confirmed with executive

• Demonstration/Presentation delivered

• Proposal reviewed with executives

• Notification of short list

• Proposal submitted

• Proof conducted

• Decision pending

• Verbal commit

• Contracting process identified

• Agreement on contract terms and conditions

Pipeline Upside Commit

Lead

Understand Requirements

0% 5% 20% 40% 75% 90%


Your Sales Process in SFA


=

So What’s the Problem…


Start with Sales Process

Clo

sed

Qualify DiscoverDevelopSolution Propose Negotiate

Sales Stages


Add Best Practice Activities

Collaborate on the

Evaluation Steps!

Do we have

Access?

How will the Customer

Measure Value?

Which StakeholdersVote on the

Final Decision?


Collect the Reward!

Clo

sed


Sales Stages

Sales Process Win Rate

No Process 38%Semi-Formal 46%

Formal 48%Dynamic 52%


Align with Buying Process

Awarenessof Issue Prioritize

ExplorePossibleSolutions

EvaluateVendors

SelectVendor

Negotiate

Buyer Stages

Sta

rtC

lose

d


Sales Stages


Test Progress with Evidence

Clo

sed

Sta

rt

RFP/RFIIssued

Presentation/Demo Request

ShortListed

Legal ReviewPilot

Web/SocialActivity


Why implement process?

Aligns toCustomer Buy Cycle

Win Rate

Poor 43%

Average 47%

Excellent 60%



Forecast with Confidence – The Five Pillars3. Sales Tools


Build a Plan – Begin with the end in mind

ReceiveValueDeployDeliverSign

ContractVendor of

ChoiceFinalistsSelectedTODAY

DateWhyWho

KPIMetrics

Source of Urgency

ApprovalProcess

DecisionProcess

EvaluationProcess


Collaborate on the Plan

Activity Week of

Discovery Interviews – Prospect Technology Team 29-JulDiscovery interviews - Prospect Finance Team 5-AugSummarize findings and prospect agreement 12-Aug

Collaborate on Plan/Timing for Evaluation 19-AugCapture KPI/Metrics Current State 26-Aug

Develop Implementation Plan 2-SepAgree on preliminary success criteria 9-Sep

Submit contracts to legal 16-SepGain legal approval (Terms & Conditions) 23-Sep

Present proposal for approval 30-SepFinal negotiations 7-Oct

Contract Signed/Purchase Order Issued 14-OctImplementation Kick-Off 21-Oct

Go Live Date 15-JanMeasure Success 22-Jan


Build a Plan – Watch for Bear Traps

- Procurement- Board Approval- Security Reviews


Map the Decision Makers

✔ ✔


Value tools and Negotiation Plan

P&L

Reduce Sales

Expense 5%

Increase Sales

Volume 5%

DecreaseDiscount

5%

Sales 100.0 100.0 105.0 105.0

Cost of Goods 60.0 60.0 63.0 60.0

Gross Profit 40.0 40.0 42.0 45.0

Fixed Costs 13.0 13.0 13.0 13.0

General & Admin. 11.0 11.0 11.0 11.0

Sales Expenses 6.0 5.7 6.0 6.0

Profit Before Tax 10.0 10.3 12.0 15.0

Profit Increase 3.0% 20.0% 50.0%

Harvard Business School Publication #9-192-098 rev 7/9/92


Forecast with Confidence – The Five Pillars4. Coaching


What is coaching?

38

Manager: Frank, I’m concerned about your

forecast Frank : Just submitted the final proposal to XYZ, I’m confident it will close this month


What happens at the point of the Spear?

Poor Average Excellent0%

20%

40%

60%43% 47% 52%

Proactive Coaching



When to Coach

Clo

sed


Right Deal?

Can we Win?

Will it Close on Time?


Rep

Fore

cast

Ski

ll Trust but Verify

Coach

Priority #1

Monitor

Ignore

Prioritize your coaching

Deal Size


Forecast with Confidence – The Five Pillars5. Analytics/Metrics


Why analytics and metrics?

43

40%50%60%70%

44.30%51.80%54.80%

70.40%

No AnalyticsWith Analytics



What to measure

• Average Deal Size• Time to Win/Lose a deal• Qualification Score to Win/Loss• % of Outcome/Evidence to

Win/Loss• Velocity/Dropout between

Stages• Average Discount• Forecast Accuracy

44

New vs. ExistingDeal Size – Small vs. LargeCustomer Size – Small vs. Large


Average Sales Cycle – New vs. Existing Customer

CSO Insights, Inc. 2013 Sales Performance Survey


Sales Process Dynamics

OpportunitiesExiting Process

Leads In

60% 48% 22% 10%

Dis

covery

Pro

pose

Neg

otia

te

Clo

sed

W

on

Qu

alify

90Days

46Days

32Days

39DaysStage

Duration


Don’t get Siebel-ed

Deal Forecast Percent

Amount

Deal #1 75% $1,000,000

Deal #2 75% $1,000,000

Forecast Amount ???

Forecast Percent vs

Forecast Category

10% Omitted25% Pipeline50% Upside75% Commit90%



Which reps are following the sales process?


VP of Sales – WIIFM?

Trusted Forecast

All Others0.00%

5.00%

10.00%

15.00%

Aberdeen Group – Sales Forecasting Benchmark Report

Average Revenue Growth Rates


• Understand your ideal customer and when they buy

• Create an evidence-based, buyer-aligned forecast

• Leverage tools to plan and win• Change Sales Managers from “flogger of the

forecast“ to “Sales Coach”• Leverage key metrics into forecast reporting

Forecast with Confidence!


Questions?

Tim BramanVP Corporate [email protected]