Despite the unprecedented changes and challenges of the last year, it was still business as usual in some ways for many companies out there. Mid-way through 2020, a World at Work survey on sales compensation showed that just 15% of companies reported their leadership teams had taken immediate action to refine quota or comp plans in response to COVID-19. Unsurprisingly, by the end of the year, the number of companies reporting that less than a quarter of their sales team had reached quota had doubled compared to 2019.
2020 probably made a lot of sales and finance teams begin to see the old way of quota planning and management using spreadsheets and manual processes as a risk. They couldn’t move fast enough or pinpoint what and how to adjust.
To get a solid handle on this unique challenge, our customers have increasingly been turning to enterprise planning management technology, specifically Sales Planning and Performance Management. The system connects to both the CRM for pipeline data and the ERP for financial actuals, with built-in best practice methodologies for planning and analyzing territories and quotas.
Predictive planning capabilities help businesses get a true sense of performance and what to expect. Users can run what-if scenarios by territory, account, and channel, and analyze market changes such as seasonality or crisis situations like COVID.
Forecasting has always been an interesting challenge
Different parts of the business need sales forecasts for different reasons, so it’s not a one-size-fits-all situation.
Sales management uses a forecast to keep their teams accountable. Will they make their number? How are their reps doing? What’s changed since last week, last month, or last quarter? Finance relies on a forecast to make business decisions – to understand exactly how the business is performing and what adjustments need to be made. And individual sellers fall somewhere in the middle. They need to stay accountable regarding their targets and understand the real financial situation they can expect regarding earnings.
Fortunately, there are options, some of which are going to do a good job for sales, like pipeline reporting and using spreadsheets for analysis. Even better, though, you can use the simplified forecasting from Oracle Sales to make adjustments on top of the pipeline in real time. Both are sales rep- and manager-facing options that meet the typical requirements for these teams.
For finance, advanced forecasting fits the bill and is what many businesses are looking at in 2021. Advanced forecasting makes it easy for the business to achieve a more realistic forecast and make predictions based on both pipeline data and financial actuals.
This is especially important right now because it’s never been riskier to depend on CRM pipeline data for accurate forecasting. We saw how hard it was in 2020 for businesses to make planning decisions, such as quota adjustments.
This year, it will likely be a while before sales leadership can confidently understand what marketing recovery will look like, which purchasing budgets will dry up, and what’s still on the table. While pipeline can be an inaccurate source on its own, when combined with historical actuals – even just very recent bookings – a business can start to triangulate around a realistic forecast and get some predictability.
They can then begin to act on this information more confidently and plan for how to redistribute resources or shift business models – all based on real data and AI-derived predictions.
Learn more about the Sales Planning Cloud’s advanced forecasting capabilities and how it can help you identify evolving trends and take effective action sooner than later.