As a sales executive, you put the execution of your company’s go-to-market strategy in the hands of the sales force. However, the more your team grows, the more you might feel that you’re out of touch with what is happening on the front line. You may become more reliant upon reports to supplement your knowledge and request frequent pipeline and forecast data. Although understandable, these requests will take your front-line sales managers away from their daily responsibilities managing rep performance. The resource cost of producing many reports may decrease overall profitability. Here are three signs that your appetite for sales forecasting data might starve your sales force of much needed resources.
1) Sales managers are spending nearly half their time managing information
A recent study by Adam Rapp of the University of Ohio found that front-line sales managers spend about 32% of their time managing their sales team, but as much as 44% of their time managing information and performing administrative tasks. This means sales managers are investing almost half of their time on administration, often at the expense of the development of the sales force. Rapp’s research identified yet another troubling finding: managers who spend more than four hours per week managing information experience a reduction in productivity.
Take away: The more time sales managers spend managing information, the larger the productivity hit.
Source: Adam Rapp, Ohio University, Executive Director and the Ralph and Luci Schey Professor of Sales
2) Your sales force is not being coached
What sales manager action has the most impact on improving sales force performance and in turn, the bottom line? Something which many sales managers neglect -- coaching sellers. CEB published a study on the potential impact of manager-led coaching and found that sales people who receive effective coaching outperform those who don’t by as much as 19%. Today’s sales manager is often over-burdened and under-supported. In addition to a data deluge, sales manager’s responsibilities have increased, sales jobs have become more complex, and geographic dispersion of sales teams is often wider than ever before.
Take away: For better execution in the field, consider balancing the need for forecasting data with more support for sales coaching and front-line execution.
3) Your sales managers are required to submit forecasts weekly
Research from Vantage Point and the Sales Management Association found that executives at 43% of companies surveyed required forecast reports one or more times a week. The study also found that the more frequent the forecasts, the less accurate they tended to be. Companies with weekly forecast requirements reported an average forecasting accuracy of 3.3 on a scale of one to seven with seven representing highly accurate forecasts. However, companies with quarterly or fewer forecasts reported a slightly higher average score of 4.
Take away: Weekly forecasting does necessarily result in more accurate forecasts.
It is clear that sales forecasts matter, but maybe not as much as you might think. By reducing the number of sales forecasts required, your sales leadership will have the bandwidth needed to invest in activities such as sales coaching and sales force performance improvement. These will result in a tangible impact on the bottom line.
About the Author
Michelle Vazzana is a founding partner at Vantage Point Performance, a global sales management training and development firm. Vazzana is also co-author of Cracking the Sales Management Code. She is a sought-after speaker on the topic of sales management and leadership and has more than 28 years of successful sales and management experience. Sign up for Vantage Point’s newsletter to stay up to date with the latest manager research and best practices.