Remember that strategic plan you set up? It was, and is, full of energy and inspiration. But there is a temptation to get distracted by everyday performance as you and your team look at more short-term goals. It is not unusual for CEOs and other senior executives to focus on what is happening now. This month, this quarter can become all that you see when you aim for your sales forecast. This myopic view can put you on your heels in terms of thinking strategically about what could happen. Things like:

• What really needs attention?
• How are the early deals predicting market trends that we will need to respond to in X months?
• What deals are stalling and where?
• What are the business outcomes?
• How do these business outcomes match the goals we set?
• What problems or obstacles do we anticipate?
• What do we need to do to prepare the board of directors?

A sales forecast with more certainty helps to answer the above questions. The real question is how do we actually get that forecast that has more certainty? And could this certainty show you that the strategic plan is still relevant?

How did you do last year?

In a survey conducted by Gong.io, they discovered that more than half of the respondents regularly miss their sales forecast by more than 10%. Anecdotally, we hear similar and even more significant gaps between the forecast and the actual outcome.

If you were to examine what is creating this gap, it might lead you to look at the CRM, its use, or how the frontline sales managers interact with their teams. You might even look at your process or your methodology. However, one area that needs more attention is the sales conversation.

Lots of moving parts in the sales conversation

It is known that buyers typically engage sellers in their sales conversation well into the buying decision process. However, less well-known buyers make small commitments as they interact with your salespeople. These commitments build up to the agreement to purchase your solution. That is why there is no big close.

Small commitments add up to five fundamental Core Commitments that help measure the deal’s progress and give information used in a forecast. The Core Commitments are qualitative and quantitative, so they bring certainty to the sales pipeline and forecast. Basically, they provide a critical framework for the arc of the deal. This is how the Core Commitments provide structure.

Core Commitments and the Sales Forecast

As your buyer confirms each Core Commitment through the arc of the deal, this demonstrates the health of the deal. For example, one of our clients integrated the Core Commitments into their CRM and their one-to-ones. There was a percentage attached to each Core Commitment, and the salespeople provided evidence of how the buyer met the criteria of the commitment. For the salespeople who applied this more rigorously to their process, they were able to do two things

• They more quickly identify obstacles before they become objections.
• They noticed gaps in their information that they could fill in when they next communicated with the buyer.

Using the metrics

In many sales team meetings and one-to-ones, sellers will say that they “think” or “feel” that the buyer is at a certain point in their decision process. The catch here is that this depends on the seller’s perception of the conversation. A lot of seemingly very positive sales conversations have resulted in no sales.

These perceptions get baked into the sales forecast with statements like, “I’ve got one signing at the end of the month and potential of two more.” Another way that forecasts are fudged is that many sellers do not want to appear like they are failing, so they attach a higher percentage in the CRM that the deal will close when there is little to no likelihood of a completed deal in that reporting period. Another thing to consider is that some sellers postpone entering information into the CRM because sellers want to interact with buyers more than do the data entry. This messy data makes for an inaccurate forecast.

As this forecast gets shared, things can happen, like a manager giving a rep’s forecast a “haircut” or a senior executive making other adjustments before reporting the forecast publicly. As we wrote in a past Insights post, your sales team is not trying to sabotage you. They do need to understand what is happening in the buyer’s head and map each commitment along the way.

Understanding the buyer’s decision process will give you a more certain sales forecast

Adding the Core Commitments to your pipeline and forecasting gives your process an evidence-based structure that alleviates the uncertainty of the deal’s status. Since the Core Commitments are consistent with the buyer’s decision-making process, they use the sales conversation as the means to clarify information.  Using your process and methodology, you can decide the sequence of Core Commitments and how to guide the buying decision throughout the arc of the deal. With your metrics, you can identify an impending buying decision. This alignment and structure support your team in developing greater consistency in the sales forecast.

When you think about sales effectiveness at your organization, does it seem like you are close but just missing those unique elements that give you that competitive edge? Looking for a way to understand how your buyer thinks, decides, and reveals information? At The Nova Consulting Group, we believe that professional selling is a craft. With the Advanced Sales Conversation©, you have those missing elements that move your salespeople from competency to mastery. With our deep understanding of what makes and sustains high-performance organizations, we provide integrated solutions that do not replace your sales methodology and yet advance a progressive selling mindset. Be bolder, more insightful, and get results. To learn more about how to master the craft of sales and encourage sustainable high performance, call  (617) 933-7249 or email info@novaconsultinggrp.com.

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