The Forecast: 3 Steps To Building A More Effective Sales Organization

October 6, 2010

There are three types of sales reps in every sales force.

Those that consistently knock it out of the park.  Those that close just enough business to warrant another day on payroll.  And those that we know we should just put out of their misery, who suck off the company and fail to deliver any value in return.

There are producers, muddlers, and consumers.  And a key to sales force management is to identify who fits into which bucket, so that an organization can overload with producers as quickly as possible.  Easier said than done?  Hardly.

3 Steps to Building A More Effective Sales Organization:

  • Step one is to put a real discipline into forecasting.  Make your sales force forecast daily through a cloud application like salesforce.com.  Then, hold a weekly forecast call where you ask each member of your sales force to identify their commitments for the current month.  Make them stand up and commit.  In salesforce forecasting, a commit is a commit.
     
  • Step two is to re-visit your monthly forecast after the month has closed.  Salesforce implementations provide a standard report that measures forecast effectiveness.
     
  • Step three is to analyze the results.  Here is what you will find:

Consumers will typically forecast nothing in the current month, and a lot in future months.  They will have a laundry list of excuses as to why the immediate future is bleak, but long-term prospects are strong.  My territory stinks; our product is inferior;  my dog ate my homework.  Consumers are full of excuses, and they are good at delivering them.  Take a close look at their forecast and get your trigger finger ready.

Muddlers will overcommit early.  They will have a bucket full of deals mid-month, and they “expect them all to close.”  Muddlers get management excited, but they inevitably disappoint.  Their forecast accuracy is, at best 50%.  It’s up to management to decide whether this behavior can be corrected.

Producers?  Well, thank god for them.  They commit exactly what they will close.  Sometimes, they even sandbag a little, but in the end, they deliver.

And the key to building sales effectiveness is to do everything possible to hire and retain the producers.  Whether they are producing new deals, new internal innovations, new ways of pleasing customer’s, new ways of attacking a market, or new ways of creating efficiencies that make the muddlers and the consumers obsolete.

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