"Past performance is not an indicator of future returns" goes the old caveat, so beloved of financial institutions who hope you don’t read the small print too closely when you invest with them.
And while it is a very helpful indicator, past performance also comes with a wealth warning when you’re making sales forecasts.
So how can the sales manager, with everyone on his back to know what to expect in the next month/quarter, provide an accurate assessment?
Some companies use regular sales meetings, (weekly, monthly, etc.) as the qualification process for the forecast report.
Others rely on the outcome of each opportunity to decide on how good the forecast report WAS!
And some use both meetings and outcomes.
That’s fine - but the problem seems to be that all the activities deal with the past.
This is not to say that there are no discussions about current opportunities, but once again they seem to focus on issues that have arisen and could affect the sale.
How about some forward planning? What mechanism can be used to make forward planning much easier? How about capturing the sales process by which the sales manager uses to qualify each of the opportunities that his team is handling and making it available to the whole team in a very simple and effective manner?
In this way each of the sales team will be continually qualifying their opportunities, thereby being able to anticipate the next steps required towards a successful outcome. This will help in shortening the sales cycle. They will even start qualifying opportunities as to whether they should be pursued.
So what does the sales manager do now? He can coach his team and build them into a more efficient and effective sales force. Oh yes, and when the forecast report is required it will be accurate and consistent… because it is a natural by-product of the sales qualification process.