The post-Covid pullback is a time that will forever be seared into my brain as a GTM leader. There was a point where it became clear to me that the SaaS game changed. I can’t remember exactly when it was, but I saw that an industry that had always valued growth above all else – by literally more than an order of magnitude for much of that time – changed overnight. Growth at all costs was out - and efficient growth was in.

And that had immediate implications, notably layoffs. We went through that process, a gut-wrenching aspect of being in a leadership position. But I remember something vividly about that stretch of time. Our weekly forecast call happened to fall the day after we downsized our GTM team by 20%. As we did every week, we started by reviewing the data-driven revenue predictions from both our forecasting tool as well as our internal data analytics team. 

And guess what? The predictions actually showed a sales forecast that was higher than the week before we reduced quota-carrying headcount. 

One-Dimensional Forecasting

How could that be? We meaningfully reduced the size of our salesforce yet our predicted short-term outcome got better? The reality is that when most teams talk about a sales forecast, what they are really talking about is a deal forecast. In our case, the deals were still there -- even if several of them no longer had an owner – so the systems were fooled. 

What we call ‘sales forecasting’ solutions today could be more accurately labeled ‘deal forecasting’ solutions. It’s an approach that zooms in to analyze specific deals and zooms out to look at the aggregate of deals (aka pipeline). Those solutions are designed to arm sales leaders with valuable insights about the state of the current quarter, certain risks, and overall pipeline health.

But all too often this one-dimensional forecasting is less than precise, and it leaves leaders chasing the revenue predictably they need to efficiently and effectively manage the business. And while forecasting imprecision may have been glossed over with easy access to capital in the growth-at-all-costs era, it has serious ramifications today. No longer can we simply spend more to ‘catch up.’ 

A Better Sales Forecast

No one is disputing that deal forecasting is a necessary part of building a sales forecast; of course it is. But there is another critical element to consider: people. What does that mean? It means you have to factor in capacity and constantly examine performance assumptions, both of which are people-centric. 

Specifically, building a better sales forecast requires that you consider all of the following:

• ‍Current sales capacity: How many reps are in-seat vs. our plan and what’s the balance of fully ramped vs. ramping reps? Are they in the right seats?
• ‍Ramping performance: How are reps actually ramping versus our assumptions? Does this present a current quarter risk based on our current sales capacity?
• ‍Pipeline generation capacity: Do I have enough pipeline-creating team members in my org?
• ‍Hiring & Attrition: Are we executing against our hiring plan or do we continue to run behind? Is attrition running lower or higher than expected? 

All of these people-centric factors matter every bit as much as the deal and pipeline analysis that GTM teams routinely do on a weekly basis. 

If you’re skeptical about the importance, stop for a second and think about the QBRs and board meetings that you’ve been in where there’s a discussion about missing a prior forecast. I bet you’ve heard (or maybe said) something along these lines:

• “Our reps aren’t ramping fast enough and we simply didn’t have enough fully productive capacity this quarter.” 

• “We were behind on hiring targets and weren’t able to get enough reps in-seat to hit our number.”

• “We haven’t hit our pipeline generation targets and have been consistently low on coverage.”

• “Attrition was slightly higher than expected, plus we had two reps out on leave.”

We need a better approach to sales forecasting, and that’s been the driving force behind Revcast.

‍

People-First Sales Forecasting

Excluding companies that are 100% PLG (very few), people are the driving force behind sales outcomes. If they are the driving force behind the outcomes, then it follows that they should be a significant factor in predicting those outcomes. We’ve built Revcast to help leaders do this – to deliver a people-first sales forecast approach that helps create a more precise sales forecast, enabling predictability and overall better GTM management. 

With Revcast, GTM leaders have a structured approach to the following:

• Capturing their sales plan, including key performance assumptions like ramp schedules, quota attainment, win rate, cycle time, and average sales price

• Defining hiring plans, headcount allocation across teams and roles, people movements across the org, and attrition assumptions

• Automating reporting against the plan and core assumptions 

• Making real-time personnel and capacity decisions to affect sales outcomes

Our customers routinely report that after adopting Revcast, they’ve increased forecasting precision and confidence in their ability to hit targets overall – thanks to making better people decisions. They also say that they’ve always seen the need for a better approach to capacity, but data silos and the human effort required to do what Revcast automates meant that it wasn’t previously feasible. 

If you want to join the ranks of GTM leaders making people-first sales forecasting a priority, reach out to us! 

‍