5 Sales Planning Rules to Break Immediately

How is it that revenue teams are caught by surprise when they miss their revenue forecast, even though they still use the same tools and processes that they always have, and continue to hire the same profiles? 

This blog identifies how to chart a course from sales to revenue with effective revenue planning and sales forecasting—and which “tried and true” rules need to be broken along the way. It’s a summary of my conversation with my esteemed colleague, Erik Charles of Xactly, which you can watch here.

Discovering Holes in Sales’ Sinking Ship

The last 12 months have exposed inefficiencies that have plagued revenue performance for decades. 

At best, sales teams use ⅓ of their time selling, and when sellers are selling, 80% of decision makers complain that they squander first meetings. This is likely a big reason that buyers spend only 17% of their purchase journey talking to vendors. If there are three vendors in the process, that means your company likely receives just over 5%. The rest of the purchase journey—as much as 80% according to some research institutions—is spent in digital channels.

Technology is not the answer anymore. The average revenue team uses more than 20 tools. The answer lies in revenue efficiency. It’s the reason, alongside narrowing budgets, that heads of revenue recognize they now need to be experts in Revenue Operations.

But what’s a trusted framework for sales planning and forecasting that delivers revenue performance?

3 Steps to Chart a Course from Sales to Revenue Recognition

Whereas 55% of revenue leaders meet their forecast when they don’t use forecasting best practices, 97% meet their forecast when they do. Which group would you rather be in? Here’s how to chart your bearing from one waypoint to the next.

Step #1: De-Flaw Your Process

You have to take your organization and target market’s maturity into account.

• Greenfield. Startups need to start with deciding targets, then quotas, then territories, then capacity planning. That order reflects the ultimate question leaders need to answer: How many people do I hire?
• Established. Conversely, companies that have been in business for years need to know what size territories they need to hit their next growth stage. They begin with targets, then capacity, quotas, and finally end with territories.

Support either approach with intelligent, machine learning-enhanced tools—especially to ensure you have the right reps in the right roles.

Step #2: Get everybody in the room

Most sales planning excludes other revenue-critical pieces of the funnel: 

• The top of funnel (marketing and account/business development)
• Upsell/cross-sell (customer success/service)
• New offerings (product)

The best car salesmen have life-long relationships with their customers. There are some smart lessons we can learn from people who have been in business for a long time.

Step #3: Reschedule the schedule

Integrating these functions can go wrong. As demand generation managers know, your end of Q3 generally involves identifying how many meetings the SDR team needs to book for the next calendar year. It’s unlikely for teams to ask how many meetings get them to their sales number.

Only with a view of the entire journey can we know how many meetings produces our revenue number. This requires continuous planning that incorporates all revenue constituencies. Getting all of these leaders—marketing, sales, customer success, product—in the same room can be uncomfortable because sales planning happened in a silo for a long time. But discomfort aside, the best way to meet our revenue plan is to evaluate performance with all revenue leaders in the same room on a weekly or bi-weekly cadence, and adjust if needed. 

5 Sales Planning Rules to Break

We got into the situation because we’ve been doing sales planning the same way for years. Now, we need a new approach, and here are the rules we need to reimagine along the way.

1.“Planning once a quarter or year is enough.” We now need to plan continuously.

2. “Sales planning isn’t called marketing planning or customer success planning for a reason.” We now need revenue planning.

3. “Traditional methods for quota and territory planning work.” Today, we need an automated, intelligent approach.

4. “I just need more data.” Today, we need actionable insights, based on data.

5. “I can do all I need to do with Excel or Google spreadsheets.” Spreadsheets involve herculean effort and umpteen errors. Only automated platforms deliver the maturity that today’s revenue leaders need as they plan.

Breaking out of data jail with sales planning maturity involves processes that are continuous, collaborative, automated, and data driven. View the complete webinar recording here to learn more.