Eliminating Emotion From Pipeline Forecasting

Eliminate emotion from pipeline forecasting

“It’s a combination of both art and science,” is a phrase you hear when someone is trying to describe a process that, while mostly based on facts or data, is infused with some other factors, most commonly human emotion.

Using art and science might work for some things, but for sales managers to understand and accurately predict how much of their reps’ open pipeline will be closed/won by the end of a quota period, they need reliable information, not emotion. Yet, managers have one on ones with their sales reps, and when the discussion turns to open pipeline, too often art and science are both in the room. Science (data in this case) is represented by the list of a reps’ open opps, by stage. Art, or emotion, is represented any time a sales manager asks a rep: “How do you feel about (insert opportunity name here) turning into a win?”  

This question is more likely to be asked about earlier stage opps, but really, until a deal is signed, anything can submarine it, so managers usually ask about all open opps. Sales managers need a solid picture of how much additional revenue each rep will close before the end of the quota period.   They also need to compare that number to each rep’s remaining quota. The delta between forecasted revenue and quota remaining determines a manager’s strategy moving forward.

But by asking reps what they think, managers deemphasize facts and data and give weight to emotion. Some reps are reluctant to admit they’re struggling with their quota and will talk about what they “hope” will happen, not what they “think” will. That means they’ll overestimate what’s likely to close. Other reps may downplay their pipeline’s potential, choosing to underpromise and overdeliver. That makes it challenging for their manager to provide an accurate rolled-up forecast to the business.

The answer is to remove art from the equation and focus on data. Beyond helping sales leaders track rep performance for activities, KPIs and sales velocity, Rekener’s Sales Rep Scorecard also empowers them to remove emotion from pipeline discussions and instead focus on facts.  How? Sales Rep Scorecards calculate average win rates for all historical opportunities in a particular stage. Then, the historical win rates are applied to each rep’s open pipeline currently in that stage. This produces an accurate and unbiased calculation of how much revenue is likely to be closed.

Comparing each rep's total forecast against their quota is called forecast coverage.  It predicts how far ahead or behind their quota each rep is likely to end up.

The result? Managers can see, at a glance, how much of a rep’s total open pipeline is likely to close in the quota period, add it to what’s already closed and compute a true forecast number.  That forecast number can be benchmarked against quota, giving sales managers all the insight they need, based on facts, to track rep performance.

Forecast projection and forecast coverage by sales rep

Forecasting based on historical win rates also changes the dynamic of the one-on-one. No longer is a rep asked to draw on emotion when providing feedback on their pipeline. Now, sales leaders can drive the conversation, supported by facts, and outline what expectations are for each rep’s open pipeline and why. Sales managers can speak knowingly about progress towards quota to their managers and have data, not a rep’s best guesses, as the foundation for those conversations. As it gets closer to the end of quarter or year, surprises are fewer because the data-driven strategy has been in effect from its start.  

As a sales manager, consistent, accurate forecasting is one of the most important elements in your playbook. Rekener’s Sales Rep Scorecard will strengthen your forecasting and empower your sales one on ones in new and productive ways.

Sales Rep Scorecards Can Help 

Rekener's Sales Rep Scorecard app is the fastest and most powerful way to give your sales leaders (at all levels) the visibility they need to run great one on ones.  We crunch the data so you can focus on crushing your numbers. 

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John Byrne

John is a Senior BizOps Strategist at Rekener. Each day, John collaborates with Rekener customers to leverage the Rekener platform and drive deep business insights. A veteran of the technology startup space, John’s love for data storytelling helps sales, marketing, and ops teams see the big picture in a way that’s easily understood and actionable.

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