Reaching our Sales Goal – Is it a Roll of the Dice?
Contributed by David Shaffer
We enter each year with renewed optimism that our projected revenue opportunities will come to fruition. For many companies, the projected allocations of direct expenses are linked to revenue and built on the assumption the revenue will be reached. When sales fall short of expectation, particularly for those companies that have budgeted and incurred expenses based upon projections, the impact on overall profitability can be devastating. So, are there some recommended steps that can help management determine with greater certainty whether the attainment is in fact viable? Although there are never any guarantees, the following questions are several that at a minimum help create focus and improve visibility into the sales revenue attainment.
If you can say yes we do these things then consider yourself part of the few that are on top of their sales projections.
- In many organizations, 80% of the projected revenue will come from 20% of existing or targeted opportunities. With this in mind, do we have a specific, documented plan as to how to deliver to each of these customers including time frame, products, services and investment expectations?
- Have we implemented a management friendly CRM system that allows for overall backlog management and revenue projections?
- Have we established regular sales meetings where based upon variances between monthly target attainment and actual revenue that we have implemented the appropriate “to-go” strategies to make up shortfalls?
- Is the compensation/commission plan setup so that it is leveraged to incentivize the sales representatives to meet the expected goals rather than simply paying commissions on straight revenue? Is there a balanced scorecard expectation?
- Do we conduct regular backlog review meetings to identify opportunities that seem to reside forever on the backlog creating a false sense of projected revenue?
- Have we developed a plan and revenue target for inside sales personnel who can impact and leverage overall revenue attainment?
- Have we aligned sales territory coverage to maximize our presence in the areas of greatest opportunities?
- Have we developed and implemented the appropriate sales training within our organization to help maximize the performance of our personnel?
- Do we have the appropriate customer follow-up procedures in place to get their feedback and assure we are in fact providing value?
- Have we established multiple financial scenarios to ensure the financial health of the company based upon different levels of sales revenue attainment?
Questions such as these are not intended to dampen the enthusiasm and drive of sales representatives but rather increase visibility into meeting sales goals and creating an overall accountability necessary for any business success.