Blog

Forecasting Accuracy: How to Clear the Fog

In the 1966 film Blow-Up, a London fashion photographer named Thomas unknowingly documents a murder. At first, Thomas doesn’t notice the crime hidden in his photograph. The blurred background accentuated by shadows and foliage make the scene invisible. After he repeatedly blows up the image, zooming in over and over again on what seems to be a minor feature, is the disturbing truth revealed: a terrible crime has been committed and the photograph has made Thomas a witness. The most important thing in the photo had been concealed in the background all along.

I mention this movie because it reminds me of forecasting. Many times the reason for buying or not buying a solution are in plain site, but hidden by the shadows of other priorities. 

One of my client companies sells software to aid in the development of software. They had asked me to analyze a set of loss and no decision outcomes to understand if there were any trends they could get an upper hand on. I first interviewed the sales teams, then I reached out to the buyers for each opportunity. In one particular case, the sales person classified the no decision outcome as a lack of budget. When I talked to the buyer, he told me that the company was growing so fast, and hiring so quickly, they ran out of parking space. It turns out the CEO redirected any excess funds to build a parking garage, pushing many other purchases on to the back burner for sponsor and seller alike.

In this case, the hidden “crime” was actually in plain site. However, to reveal it, the seller needed to ask a few more questions. When I was a young sales person working for a technology software company, I had the pleasure to take Rick, our Senior VP of Worldwide Sales on several high level relationship building meetings with my most important clients. I noticed in every meeting Rick started each conversation by asking about the client’s business… “how’s business?” he would ask, or “I read about the recent acquisitions your company has executed, how are those working out?”, on occasion, being even more direct, “I understand your CEO has announced company wide cost cutting initiatives, how’s that affecting your team?” 

My reaction to his questions varied from wondering why he would ask a senior technical leader about business, to kicking myself for missing the elephant in the room when he had obviously done his homework better than I did. 

After one particularly hair raising insight gained from one of his broad, “how’s business going” questions (my client revealed a merger pending with one of our other customers who had a much better pricing arrangement with us), I began to appreciate the value of his line of questions. He was purposely trying to uncover the priorities of the client both hidden and in plain view. In most cases, the answers provided gave me better insight into the forecast likelihood of the opportunity, both good and bad.

The current business issues of your customers will dictate their buying behavior. When the sponsor goes to the funder for sign-off, the current business issues that have his or her attention will influence their desire to fund or not fund a purchase request. For instance, cost cutting initiatives will put most purchases on hold, while prioritizing purchases that can save additional costs in other areas. A recent merger announcement can also put purchases on hold until the dust settles. Other business issues like changing competitive landscapes,  or changes in federal regulation could be positive for many selling situations. Rick taught me to evaluate my selling opportunity against the current business issues of my prospect to get a better insight on the forecast likelihood of every opportunity.

Kevin Temple guides sales teams to be more agile and improve revenue outcomes. He can be contacted at kevin@enterprise-selling.com. The Enterprise Selling Group is a leader in delivering sales training, coaching and project oversight to improve the agility of sales teams around the world.

Leave a Reply

Your email address will not be published. Required fields are marked *