By: Don Gray
Over the years of both doing direct selling and managing sales teams, I began to analyze why sales forecasting was so unreliable. Why could we not get to a high degree of accuracy month over month? It occurred to me that we did not have a well defined sales process to help us in our sales forecasting. I asked myself, so when do I say a deal is going to close? I realized that it was when I felt it was going to close. My sales teams acted the same way.
I began to examine what was critical to predict when a sales opportunity was going to close with a high degree of accuracy. My research and my evaluation of the activities I was doing helped me come up with a model that can drive a very high degree of predictability.
Principles of a sales process that will drive forecast accuracy:
- Evaluate how the customer buys from you. How do they look at your type of solution and evaluate alternatives? Who’s involved? How do they handle their budget? Understanding how the customer buys becomes the first step in developing your sales process.
- Determine Sales Stages. Sales stages reflect both how the buyer moves through the buying process and the seller moves through the selling process. What is important in defining a sales stage is to define the critical buyer decision that you want to occur at each stage. Based on this understanding, you can then develop the sales stages that follow a sales opportunity from its inception as a lead to the actual close.
- Match Key Selling Activities. While at any given point in the selling process there are many activities, matching the critical selling activities with that stage will help advance the buyer.
- Follow Advancement Criteria. What must sales be able to confirm as “accomplished” in order to move the opportunity to the next stage? When you have a consistent way of answering this question, your forecasting be accurate.
Using these four principles, especially #4, can go a long way to improving your sales forecast accuracy. As your accuracy increases, you can then better focus where you need to develop each individual sales rep on their selling skills.
About Don Gray
Don Gray is the Founder and President of Sales Engineering Group, a sales performance consultancy. Don has worked with a variety of small, medium, and large B2B organizations to help them develop their distinct value messaging, identify how customers buy their solutions, and skill their sales teams to drive predictable sales results. You can find him leading the monthly Sales & Marketing Shared Interest Groups.