Despite what’s happening in the global economy, companies still need to grow. We recently hosted a webinar featuring Adam Becker, Vice President of Go-to-Market Strategy at Conga and Scott Lichtenstein, Co-Founder at BuyerSight, about why it’s more important than ever to focus on predictable forecasting to reduce unpredictability in your pipeline.
5 years ago, the tech industry was completely focused on growth at all costs. Today, the pendulum has swung hard the other way to focus on profitable growth. Revenue organizations must adapt by reducing risk in their deals and creating consistent revenue growth.
Start by clarifying your opportunity stages
Scott Lichtenstein, Co-founder at BuyerSight, notes that one cause of inconsistent forecasting, especially at early-stage or mid-stage businesses, is that each seller on a team may view their opportunity stages differently. When reps start skipping stages, or even moving backwards, it’s time to refresh how you forecast.
“One company I consulted with had a stage in the middle of their process that was like the valley of death. If an opportunity touched this stage, the percentage chance to win dropped dramatically.” - Scott Lichtenstein
Adam Becker, VP of Go-To-Market Strategy at Conga, agrees and emphasizes that tools like Conga’s CPQ can help improve forecast fidelity by tightening the criteria to move from one stage to another. This can stop sellers from forecasting $100K deals too early in the funnel, or committing deals that aren’t well qualified.
Tips for driving more consistency
- Use your historical data. Even though the market is tougher than it was 6 months ago, it’s the best data you have. Make sure to add in a healthy dose of intuition.
- Always look forward at least one quarter. Your goal should be to increase forecast predictability further and further out–even to next year. If a new quarter starts and you realize this is the first time you’ve seen your pipeline, you’ll have a lot of clean up to do.
- Schedule forecasting retros. Look back at what you thought was going to happen and compare it to what actually happened so you can identify signs you missed in the moment. Go a step further and incentivize the right forecasting behaviors by rewarding sales managers and teams for how well they forecasted, not just for closed deals.
“Ask your customers if they know how to buy software at their company. Have they checked in with legal and finance in the last month to see if any policies or practices have changed?” - Adam Becker
- Your company also buys software. Ask your procurement team and find out what the buyer process is like today so your sellers can use this information to manage their pipelines and expectations.
- Avoid reactively reducing or even cutting your entire SDR team. You might save money in the short term, but if you take your foot off the gas when it comes to pipeline building, you’ll experience pain sooner than you think.
- Understand the unknowns in your contracts. Do you have opt out clauses that will hit your renewals number? Do your sellers understand how and when revenue is recognized? Are there compliance clauses that dictate how much of your product customers can use in a given time frame? If yes, can you extract more value from these customers?
By improving your sales reps’ understanding of the buyer experience, tightening up your opportunity stages, and improving your forecast predictability, you’ll help lead your company to profitable growth.
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