How happy are you with the accuracy of your companyâs sales forecasts? If you are like most sales leaders, you may feel that there is a little room for improvement. Or, if we are being completely honest, maybe a lot of room for improvement. In a survey of 52 companies, the Sales Management Association and Vantage Point Performance found that 74% of sales leaders felt their companyâs sales forecasts were either only somewhat accurate or, in worst-case scenarios, not accurate at all. It seems there is a deep-rooted dissatisfaction with sales forecast accuracy, but what can sales leaders do about it?
While there are multiple ways to improve your sales forceâs forecasting ability, one of the highest impact activities that improves sales forecast accuracy is training. In fact, our survey found that companies that trained sellers on how to forecast reported an 11% greater forecast accuracy over companies that didnât invest in sales forecast training. But thatâs not all. Companies that train sales managers on how to forecast showed an astounding 27% improvement in forecast accuracy over companies with untrained sales managers.
It is clear that training sales managers to forecast matters a great deal, but what skills specifically should be included in the training? At Vantage Point, we have found that there are at least six skills necessary for helping sales managers lead a sales force to master the art and science of sales forecasting. Sales managers succeed in sales forecasting when they know how to:
â¢ Make a distinction between forecasting and pipeline management.
â¢ Select an appropriate forecasting framework based on sales roles.
â¢ Lead sales people to add mathematical rigor to their forecasts.
â¢ Identify coaching opportunities during the forecasting process.
â¢ Lead the sales team to forecast based on facts and not assumptions.
â¢ Plan effective coaching conversations for forecast review meetings.
Forecasting will always remain a moving target, but that doesnât mean sales organizations canât improve their aim. Sometimes the only thing getting in the way of a clear shot is a little training on the right forecasting practices.
Visit our page on Forecasting Effectiveness for the report and the webinar video.