The single most important issue in virtually any sales organization is handling the funnel to achieve an exact sales forecast. Let’s consider two ways to handle this core issue.
Company A’s funnel process uses one of the most common methods to forecasting, orienting its sales funnel towards the steps of its sales process: qualifying, opportunity identified, quotation provided, demonstration delivered, and negotiation.
Company B uses a funnel using the customer’s purchasing process. Each stage of the funnel identifies specific actions that customers take when they’re moving forward within their buying process: accept a meeting, acknowledge their main points, meet with 2nd decision-maker, define buying criteria, request for proposal, etc.Could you guess which sales funnel design will be lead better forecasting accuracy? Right. Company B. By a big margin. If your company carries a sales funnel more similar to Company A than B, here are three tips to get you going down a more accurate forecasting path.
- Define the process in the sales funnel and CRM according to customer actions.
In Company A’s funnel structure, sales opportunities are tracked on the basis of sales tasks performed by the salesman. In a selling-focused sales funnel, it’s easy to be decided: a sales representative is confident that an opportunity will be closely successfully because they’ve done everything they’re meant to do. But tracking biased sales representative actions that he has taken,doesn’t help to predict what a customer is going to do.
In contrast, Company B has specific parameter in its sales funnel that indicate whether a customer has completed his parameters of purchasing as well as he is getting to the next. The greater a sales representative become to know that the customers complete to take next-step of actions, the more consistent and much more predictable the sales funnel becomes. By using a buying-focused sales funnel like Company B has, assuming a buyer chooses not to move forward, alarm bells set off. Sales managers are alerted for the problem immediately, and can intervene while there is still exist a chance of the problem and get the opportunity back in line.
- Transform Your Reps’ Thought of CRM from a Pain to a Gain The task of defining a customer-focused funnel includes a second benefit: Any representative who think negatively about the extra time and effort needed to output information into CRM will quickly see personal benefits from a corporation B-type approach. View it by doing this: Company A’s sales funnel generates sales process statistics which are lagging indicators (data collected after having a process is complete) – such as the number of calls, appointments, demos, and quotations have been made (or not made). By the time these data reveal an issue with a representative; its may be too late for a sales manager to obtain involved in a particular opportunity and put in the fix. All managers can perform is exhort on the basis of the representative reports, once again, “try harder.”
Company B originally experienced a CRM system like Company A, but remarked that its use through the sales force was poor. Punishing people because of not while using system didn’t work, and also the lagging indicators weren’t helping anyone improve. They found that using a more customer-focused sales funnel only agreed to be the ticket for turning point. Its CRM into something that both representatives and managers would want to use. Salesmen can be now more precise in describing which opportunities are not continuing to move forward, and they know where the trouble is arising. Also, sales managers have better ideas on customer actions in the earlier stages of the sales cycle, and can be provided more timely advice to sales representatives.
- Re-focus your sales managers on coaching for opportunities from start to finish.
In Company A, forecasting is the procedure of tracking opportunities which are nearest closing. That means sales managers typically join up when opportunities are in or nearby the Negotiate/Close step, often driving to save the day if there is an indication of trouble.
Company B’s system places much greater focus on having sales managers coach representatives through each customer milestone/ability to judged from initial contact to after-sale follow-up. Managers more quickly to recognize the importance of coaching early sales-cycle of selling skills – so their salesmen feel much better in getting more and bigger opportunities into the funnel in the first place.
Proactively Managing Sales Funnels and Forecasts Since you may have picked up, the real difference between Company A and Company B is that the formally does sales forecasting re actively-near to the end of sales opportunities. Company B, however, is proactive. They view their funnel with the intention to help them become truly customer focused: during each part of the buy-sell process, its representative is thinking about what the customer needs to do to move ahead in buying.
A better process contributes to better forecasting, not the other way round. With a buying-focused sales funnel and early (and frequently) coaching, sales managers and reps have a better feel for which opportunities actually are likely to deliver and that are in danger, and can have much more confidence in predicting which opportunities are likely to close successfully.