Leveraging Smart Data for Better Sales Forecasting

Is it better for sales reps to pursue end of quarter deals, or hold out and strengthen those same deals in the next quarter?

This question represents a timeless dilemma and relates to the Stanford-developed Marshmallow Test. Salespeople must ask themselves if the end-of-quarter instant gratification of a quick win is better than holding out for more valuable deals. Scrambling to close a quick win runs the risk of agreeing to a prospect’s counteroffer out of convenience. This, in turn, negatively impacts their commission as well as overall organizational performance.

But in economically uncertain times, how do you know when it’s beneficial to take what you can get or push for a better deal?

Well, I’m here to tell you that the answer is simple: AI and ML-backed sales forecasting.

Traditional forecasting relies on gut intuition and leveraging antiquated data to predict profitability. However, in a digital-first world, data quickly becomes irrelevant or is too abundant to holistically understand and act on.

Luckily, intelligent forecasting solutions have seen an explosion in popularity over the last couple of years and have given revenue leaders visibility into their data and pipeline that they have never had before. Leveraging these tools can equip executives with actionable, data-backed insight into earnings projections, the ability to keep the rest of the company informed, and prevent the last-minute scramble.

Show Me the Data

The truth is that without data, sales teams lack accountability and insight, which often leads to frustration all around. Actionable data can properly equip management with the ability to show teams the potential they didn’t know was there. It helps the teams see that if they position a deal one way or another that their compensation payout would increase by X%.

Beyond the team members, managers who use data find that their top-line projections remain on track and can turn a profit. Relying on data and intelligence for forecasting gives senior executives the benefit of stronger insight into the current economic landscape and how buyer behavior changes over time.

But not all data is good data. Inaccurate data causes more harm than good. By investing in forecasting tools that leverage AI, you strengthen your ability to predict commission accurately, leading to a culture built on trust and transparency. Reliable and accurate forecasting solutions allow teams to feel confident in their ability to perform and plan for the year.

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Let the Data Speak for Itself

When sales leaders have actionable data, they can inform others in the enterprise about the state of the market, resources, teams, and other important factors that come into play when reviewing performance. This allows them to examine current revenue streams and assess if their goals are in alignment with their targets to determine the quality of the deals, or if priorities need to be adjusted. Having this data on hand allows different teams to sync on go-to-market and earning goals.

To maximize your forecasting, you need to take it a step further from just mining the data to telling a story that reflects the state of your business. This allows management to better understand what needs to be done to either get back on track or stay on the course of the current action. Letting the data reveal a story will position your company in a strong place to stay ahead of competitors and focus on innovative solutions to meet the market’s current needs.

Turning Data into Strategy

Once a finance or sales leader can tell a story, they must use it to coach their teams through challenges, such as the end-of-quarter rush. Having actionable data in your back pocket creates a sense of trust and transparency with reps when they know that their quota and forecasts come from real-world information. This strengthens team relationships and fosters a shared sense of purpose among sales teams, as well as the rest of the business.

Research shows that sales reps often leave their jobs due to poor management, company culture, and a lack of career growth. Intelligent forecasting can address these issues. It allows managers to empower  their teams by leveraging data to coach reps to the next level of their career. When your company’s culture and higher-ups are supportive, reps feel a tie to the organization and teams, making the possibility of attrition lower. Good data doesn’t just help you become profitable, it causes a ripple effect that creates a positive impact felt from the bottom up.

As businesses continue to battle tough economic conditions, prioritizing accurate and predictive forecasting will help enterprises thrive.

Having strong forecasting solutions ensures sales teams and managers are equipped with real-time data to perform and create a profitable company. We all love a good marshmallow, but let’s hold out for a  s’more and allow intelligent forecasting to show, tell, and train sales teams to invest in the higher quality deals.

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