Optimism and lateral thinking are the hallmark of a “closer” and the chief attributes of a lousy forecaster, one of the great paradoxes of sales.
“Some would argue that forecasting is a necessary evil, since it drives accountability. But quotas and variable compensation take care of that”, says Justin Shriber, Vice President of Products and Marketing at C9 Inc.
“Others claim that sales reps’ first-hand deal knowledge is critical to the forecasting process. A CSO Insights report put that misconception to rest when it found that 54 percent of the deals forecasted by reps never close.”
He says companies are better served by letting reps sell and leaving forecasting to a new set of technologies driven by data science. “Indeed, in our experience, customers have a lot to gain by replacing manual forecasting processes with an approach that focuses on predictive analytics.”
These processes achieve an average 82 percent forecast accuracy on a deal-by-deal basis (versus the 46 percent CSO Insights reported) and over 95 percent accuracy in the aggregate (versus the industry average of 76 percent). As a result, sales teams get back an additional two-and-a-half hours of selling time.