Forecasting sales is a tricky business, not least of all because the process is often emotionally charged and sales executives are motivated to "manage" the flow of information, writes David Taber, CEO of SalesLogistix. CRM systems can provide a good overview of what's on tap as well as details on any given deal, but the forecasts that emerge are rarely seen as authoritative, he writes.

"Most of the time, executives must second-guess the CRM data, making judgment calls that may not be consistent week to week and are rarely recorded anywhere," Taber writes in a post at CIO magazine. "Worse, everyone's first reflex is to call the rep if they need to find out what's really going on with any account."

To make CRM data more valuable, you can't use artificial incentives to motivate sales reps. Instead, the CRM system needs to be integral to their operations. If you make resources that are near and dear to their hearts--such as travel approval and quotes--available only through the CRM system, they are likely to use it.

Taber recommends requiring all deals to be in the system for one-third the length of the sales cycle before the rep is due a commission. "Deals that just pop in three days before the close date may be welcome news, but they're bad for the organization. Make them bad for the reps as well," he writes. Define the sales cycle in three to seven phases that reflect the actual process and require that all deals go through each phase.

"Accurate forecasting systems have a lot of prerequisites, but once in place they shouldn't have a lot of moving parts," he writes. "Try to keep things as simple and transparent as you can, and try to remove by design the temptation to game the system--a tendency guaranteed to hurt forecast accuracy."

For more:
- see David Taber's post at CIO

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