Sales Forecasting To Within 1% Amidst Massive Complexity

This is not a theory... it just happened in one of the biggest and most complex companies on the planet... and the forecasting process has gone from a week to seconds.

During my corporate career, and more recently through my consulting clients, I've been on the inside of the sales automation and Customer Relationship Management (CRM) industry. CRM has always promised game-changing levels of efficiency and effectiveness yet so many companies who buy it just implement expensive contact databases and manage-up pipeline reporting tools.

Recently I've been engaged by Salesforce to speak at their upcoming World Tour Conference (topic: The rise of the silent sales floor is killing business) and also provide coaching with their sales teams. The experience has opened my eyes. It's rare to see a technology company drink their own campaign; usually it's a case of 'the builder's house never being finished'. But what I've seen with salesforce and some of their customers is breath-taking.

Nearly two decades of evolution has now been infused with artificial intelligence (AI) algorithms to transform CRM as we know it. We have reached the tipping point where sales and marketing convergence is being powered by mature salesbots and Salesforce's Einstein is leading the way. Watch this one minute video...

A salesbot doing sales management and deal coaching... wow! But what if Einstein could also manage the single biggest problem in any sales operation... the forecast? I'm under NDA so I cannot reveal the name of the large enterprise who just piloted Einstein for forecasting but I can reveal the astonishing result. A quarterly global forecast was run with traditional means (CRM reports and data sucked into Excel, then massaged by layers of management and pushed up the line from dozens of countries to the senior executive to provide regional forecasts with 'commit' and 'best case'. Then a global number was rolled-up to the senior executive and board.

But in parallel, Einstein ran a forecast algorithm based upon myriad of factors that show probability of close based upon predictive scores assessing key win factors including whether key information has been obtained, if the right people have been covered, whether the amount of time in a particular deal stage has increased slippage risk, if frequency of deal updates is on track, whether number of calls made and received along with emails sent and received shows proof of active engagement, etc. All of this matters because the level of timely buyer/seller interaction absolutely determines the probability of winning a deal and the likelihood of closing on time. Michael Bonner calls this auto-generated score in his own salesforce add-on, Pipeline Manager,"proof of life."

Unlike a human sales manager, Einstein does not have 'happy ears', hope or fear. Nor does it seek to 'manage-up' ... it just tells you the truth and does not care what you think

So.. what was the result of man versus machine, of CRM extracts into Excel and layers of managers who massage and hedge versus the forecasting salesbot? Note that there were dozens of countries, thousands of sales people and massively complex products and services.

Humans +/- 20% (took a week and the data supporting the numbers was out of date when the report was tabled)
Einstein AI +/- 1% (took seconds, real-time)

Accurate data is the foundation on which accurate forecasting depends. Traditional approaches where people are 'held to account' for their number and told they will live or die based on their commit, drives either prayerful hope at one extreme and sand-bagging at the other. Having your feet in a freezer and your head in the oven does not mean that, on average, you'll be at the right temperature.

So often the business case for buying CRM is to improve forecast accuracy but the underlying data usually remains untrustworthy unless CRM actually enables sales process. If you want accurate forecasting it starts with CRM being an indispensable part of every salesperson's day. It must be where they receive their leads, how they make their calls, where they send their email from, where they create quotes and obtain approvals, etc.

CRM success is completely dependent on the leadership's commitment to transforming the way the business markets and sells, enables the sales process, and becomes the engine for delivering brilliant seller and customer 'sales experience'.

Successful sales transformation is available for those willing to invest and lead from the front with executive commitment to a customer-centric culture. The best focus on an integrated suite to manage the entire customer lifecycle with cloud platforms for marketing, lead nurturing, sales process automation, community portals and service/support for ticketing, complaints, etc.

CRM has come a long way since the days of silo databases and clunky interfaces on a PC. Game changing improvements have been achieved with workflow for process automation, integration to price books, configuration and quoting tools, content marketing with web-to-lead processes, lead nurturing programs, tailored dashboards and reports, forecasting and integrated qualification and opportunity management methodologies, close planners, organizational charts that also map the decision power-base. Add to this; quote-to-cash, customer lifecycle management with marketing, sales, service and support all being integrated. More recently, integration to social listening and pipeline creation platforms such as LinkedIn, along with widgets to sales productivity tools such as Lusha... you get my point.

Any corporate sales team that is not fully embracing sales and marketing automation is in the process of failing by design. AI is taking sales to a whole new level

In my opinion, Salesforce is its own best reference customer. They run and incredible sales and marketing machine, and they blend technology and the phone along with inside sales and the field very effectively. Leads are followed-up professionally and in a timely manner (I receive calls from their reps the same day I download any of the reports or white papers on their website), metrics are captured and managed, leads are nurtured intelligently with seamless marketing/sales team collaboration, and they provide free high-value content in the form of web collateral and high-quality events.

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Main Image: Google: Salesforce - World Tour Paris