Your forecast is a list of opinions
A sales forecast is only as reliable as the qualification behind it. If two sellers would score the same deal differently, the board is planning against optimism.
Most sales forecasts I review are not wrong because the team is optimistic. They are wrong because each seller qualifies differently.
I once led sales for a company selling mission-critical software to telecoms operators. Cycles ran to two years and the forecast was a matter of opinion. The change that mattered most was simple and dull: one qualification method, applied the same way by every seller on every deal, and inspected every week.
The sales cycle came down from 24 months to seven. The forecast became something the board could plan against.
The two-seller test
Pick one live deal from the commit column. Ask two sellers to score it, separately, against your qualification method. If the scores differ, you do not have a forecast. You have a list of opinions with a total at the bottom.
Three questions worth asking every week
- Is there a named economic buyer, and has anyone on our side met them?
- Is the buyer's decision process written down, with dates they agreed?
- Do we know the paper process: legal, procurement and security?
A deal where nobody can name the economic buyer is theatrical pipeline. It belongs in the plan, not in the forecast.
What the board should ask
If two of our sellers looked at the same deal, would they score it the same way? If the answer is no, the problem is not the forecast.
Questions boards ask about forecast accuracy
How accurate should a sales forecast be?
Accurate enough that the board can plan against it without a private discount. Agree a band with the board, track the forecast against actuals every quarter, and treat a pattern of misses in one direction as a qualification problem, not a market problem.
Is this a CRM problem?
Rarely. If the CRM is a reporting destination rather than the place the work happens, it will never be accurate. Three fields matter most: stage, qualification and close date. Get those right and the rest follows.
Where should we start?
With one method, applied the same way by every seller. MEDDPICC explained sets out the questions; a Revenue Engine Diagnostic shows where your forecast and your evidence part company.
Is this on your board's agenda?
Thirty minutes, in confidence, on what you are seeing and what I would look at first.