Getting Sales Forecasts Right For The CEO


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Well, that’s a relative term. Nobody gets sales forecasts right, but there are ways of getting your sales forecasts more right than wrong. And, perhaps more importantly, there are ways of explaining to the people who rely on your forecasts just how you deal with the complexity of your situation.

The CEO has a number. To be fair, the analysts don’t cut her a lot of slack. In that job missing one number might be bad luck, missing two suggests you aren’t in control. Missing three means you aren’t up to the job. This is an unforgiving world, and the further up the tree you climb, the less forgiving it becomes. Control is everything, and if you aren’t in control, what are we paying you for?

That means the sales manager has three roles (at least). The first is playing nanny to the sales team. The second is driving revenue. The third is keeping the CEO in her job, and keeping yours in the process.

I know that sounds familiar 🙂

Typically what happens is the CEO is disappointed with the first number the sales manager comes up with, whatever it is. Good news, if it’ll meet the analysts expectations, but bad news if it won’t exceed them. Worse, if there’s no room in the number to make up for the deals which go bad, and there’s always some which do exactly that.

The boss demands more. She knows you’re probably holding something back. It’s a quarterly ritual – the same every time. She pushes for more. The sales managers job is getting more, right. Crack the whip on the sales guys, be more demanding of the customers, cut some deals, make me happy.

And the sales manager does, or tries like crazy, anyway. Agree to an increase in the number, and then try to make it happen.

But this is a train wreck waiting to happen, if not this time then some quarter soon. One day the cupboard will be bare, and then disaster strikes.

Chasing unrealistic numbers has consequences. Margins go down because of buy it now discounts. Operational costs go up, because of inaccurate specifications. Customer experience deteriorates as reps just won’t go away. Sales guys lose confidence in their offer, and businesses lose confidence in their sales guys.

There is another way – not an easy option but ultimately the right one.

When the sales manager manages her management into understanding the world the way it is, as opposed to the way they want it to be, good things happen.

Product defects get fixed. Marketing messages become more realistic. Prices get brought into line with the market. Realistic expectations get set, and met.

There was a time when sales was all about persuading the customer to buy what the company was selling.

But that rarely works in today’s flatter, faster world where customer reviews and comparison sites tell prospects stuff the sales rep would rather they didn’t know, and competition is everywhere.

In the Information Age success in sales can only be achieved by selling what the customer is buying.

That’s the secret to getting sales forecasts right for the CEO – getting the CEO to offer what the market is buying, and doing that better than anybody else.

Unfortunately, the Nirvana of the perfect product with perfect pricing, backed up by perfect customer service, is a situation few sales managers ever achieve.

For those who aren’t that lucky, we suggest a well thought out sales strategy, a proven sales process, forensic sales reviews, and Sales Process Probability Management.

Why doesn’t the traditional approach to selling and sales management work so well any more? What can the modern sales professional do to stay relevant in today’s customer driven markets? Check out our eBook Reengineering Sales Management for ideas on how to embrace the new order of customer driven buyer/seller relationships.

Republished with author's permission from original post.

Steven Reeves
Consultant, author, software entrepreneur, business development professional, aspiring saxophonist, busy publishing insight and ideas. Boomer turned Zoomer - thirty year sales professional with experience selling everything from debt collection to outsourcing and milking machines to mainframes. Blogger at Successful Sales Management. Head cook and bottle washer at Front Office Box.


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