As Gabriel Gourovitch mentioned in his March 24th article ‘Investors want to know how exactly you are going to reach the goals that you have written on your business plan.’ The accuracy of the numbers is essential to the prosperity of any company: it is what gains the investors’ trust, allows the startup to spend wisely and master a scaling plan at the right pace.
During forecast calls, sales leaders sometimes refer to these consolidated numbers as the worst case, the best case and the “gut feel”. But… forecast accuracy does not live in your gut, only probiotics do! And indeed, when one relies on instincts only, things can go wild. The pressure of quarter ends can seriously alter the natural (unlearned) behaviours and their reliability, such as: making your sales believe a deal will close when all signals are red.
This is why any company should consider the process of forecast accuracy as a science, just like fine watchmaking, there are a number of criteria you can measure against in order to accurately determine the timing, the size of the deal and its likelihood to ‘close’.
PIPELINE: often covers the following categories in your sales cycle: 1-discovery and 2-deep dive (attaching a potential demo to the discovery meeting, digging into use cases)
The first mistake when calling a number is believing there is an opportunity when really, there is not.
To differentiate an opportunity from a simple warm lead, basics apply: Have you had a conversation with someone of influence (champion) who opens up about technical or functional issues? Do these difficulties (pains) ideally have a business impact? Are the people you talk to engaging in the next step to solving the existing problems?
With pain, a champion and a defined series of next steps commonly agreed upon with your prospect, you can create an opportunity.
BEST CASE: often covers the following categories in your sales cycle: 3- technical validation and 4- ROI validation and proposal
The best-case phase is critical, you have paved the way to differentiate yourself from the first interactions, now it is time to prove how you do it and how you do it better than anyone else.