Probability Scores on a Forecast… Why Not Just Use Emoticons?

Posted on | June 11, 2010 | No Comments

How did this even enter the vernacular? Decades ago, someone came up with the probability percentage and attached it to a methodology. A lot of good methodology work has been forgotten – but a probability field is easy to pop into a spreadsheet or a CRM so that’s what sticks.

What is more serious, honestly accountable and credible: the ‘% likelihood to close’ or a smily-face? Personally I can’t see the difference. They both indicate much more about the mood of a sales person than they do about any customer’s intention to buy. Who can defend this thing as being a meaningful, high-quality metric?

Minutes and even hours of non-selling time go into pulling this murky percentage from an undisclosed oriface – and then  a manager spends even more time second-guessing based on personality styles and insight into the SALESPERSON. Think about this. The manager isn’t spending time to guess the customer or the solution –  the manager is guessing the attitude of the salesperson. I’ve dealt with huge organizations who do this up multiple levels and regions to get to the top offices. Hours and hours of psychology, juggling and finessing – all perfectly divorced from any knowledge of what the customer thinks about the products and services.

So – Next time the CEO wants a forecast make it more visual! Switch out those 20%s for a frown face. The 50%s should have a bored face, the 70s get a happy face and the 90s get a party icon. The CEO is bound to say ‘Awesome work, dude!’

Unless… suppose, for the sake of argument, the CEO and CFO actually have to make serious financial decisions based on a forecast. Then they might want something, say, credible. Or verifiable. Or defend-able. In which case you’ll have to drop anything that allows gut-feel to creep into the equation.

The only things that should show up on a forecast are the customer’s buying signals. The forecast is the result of a series of clear steps that document how the customer agrees to engage within their procurement framework and that they are working with you to get increasingly serious about acquiring your offering.

That’s the definition of a Stage.

What helps them to make the decision to give you a buying signal and pass forward through the stage? Those are the actions that define the Stage.

When a rep can make the progress through the all actions and the stages, that’s the buying process.

When the client stays engaged into the final two or three stages, those two or three stages are the forecast. The homework has been done. The agreements to work together are clearly understood by both parties – or they wouldn’t have made the progress to get to the final stages.

When the team is managed and monitored to follow this kind of clear discipline, asking the right question of their decision makers, there’s no need to waste non-selling time with percents or ‘commits’ and ‘best cases.’ The system that monitors and reinforces best practice keeps buyer and seller on track, asking each other the questions that make the best use of everyone’s time.

And there’s nothing more valuable to a salesperson (or a CEO… or for that matter, to a buyer) than selling time.

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