Five Probing Questions to Test Forecast Validity

Our last blog post suggested five attributes of good pipeline management. Follow those suggestions religiously and you will meet your quota AND your forecast more consistently. But try as we might as individual contributors, sometimes we are not totally honest with ourselves. As sales managers, we might not be supremely confident with the forecast picture that has been painted for us. The following five questions can work for both the individual contributor and sales management to build transparency through the sometimes over-optimistic forecasts we might deliver!

(Assume that the sales process is built on the following progression: suspect is qualified to become a prospect who is pursued for the purpose of an appointment to conduct discovery in order to present a proposal and then close. Each bold point is a critical step in the sales process and marks an advance through the pipeline and subsequent forecast.)

1. When, where, how and with whom was the discovery appointment conducted?

Based on your sales process and sales cycle, this question will often reveal the opportunity’s true place in the forecast. For instance, if your average sales cycle is 60 days from appointment to close, and the appointment occurred 90 days ago, this opportunity is possibly slipping and may not even deserve a place in the forecast. Also, if discovery was not conducted with all the major stakeholders, then perhaps there is more work to do and a less optimistic forecast should result.

2. What is the “compelling reason to act” in the proposal?

In other words, have we clearly identified the prospect’s pain point(s) in the proposal and matched the feature(s) of our product/service to create a benefit, or compelling reason to buy? Often I hear, “well, we are less expensive” or “they don’t like their current provider”. I’ve met thousands of prospects who retained a more expensive product/service even when they didn’t particularly “like” the current provider because the provider presented benefits elsewhere. If I can’t get better compelling reasons than these replies, the opportunity is removed from the forecast.

3. Who is the key decision-maker? And how do you know?

This is my favorite! Mostly the reply is this, “Well my contact is because they told me they are.” Ugh. Everyone in business is a self-proclaimed decision-maker! If we were not, we would only be worker-bees. And the person who will sign the contract is not always the key decision-maker either. Identifying the key decision-making person or group gets more difficult with more complex sales opportunities. I like the Miller Heiman framework for help in flushing out who that person or group might be for the complex sales opportunity.

4. Who and what is your competition? How would the prospect rank you against them?

I have seen way too many 30-day forecasted opportunities swept away by the competition at the last minute. Here’s a classic reply to this question, “Well, nobody, they are only looking at us!” And another, “I didn’t want to ask for fear of bringing up the idea of shopping us.” This is capitalist America, where choice and the right and duty to pursue choice are king! You better bet there is competition, if not from a direct competitor, than at least from a decision to source the solution internally or to make absolutely no decision at all. If we have not nailed down this crucial factor, the opportunity has no place in our forecast.

5. How do you know the opportunity is closed without signed contracts in hand?

The deal is never closed until the ink is dry on your contracts. Or in some sales processes, the deal may not even be closed until the product/service is delivered. In most sales processes, there is still a long way to go between a “verbal yes” and the point at which your company measures it as truly “closed”. Ensure that your sales process and associated forecasting ladder maps each and every critical step between the “verbal yes” and eventual closing.

Over the last two posts, you now have a way to manage your pipeline and to test the validity of your resultant forecast. I hope it helps you to beat quota and forecast every time!!