How to Prepare for a Salesforce Forecasting Implementation

Is your organization ready for forecasting? What can you do to prepare for a forecasting implementation in Salesforce? In this article, I will give guidance to Salesforce Admins who want to implement Salesforce forecasting and offer business preparation advice.

In a previous article, I emphasized the importance of having the right reports and dashboards and how it is a critical part of setting up Salesforce forecasting. More than any other object in Salesforce, the business change is much harder than the actual object configuration. I want you, the reader, to think through the questions presented below and to be prepared to gather this information for a quicker setup and a more successful implementation. 

I will break these down into three main categories:

1. People: Sales management, sales teams, RevOps.
2. Process: Sales process, methodology, reporting requirements.
3. Technology: Salesforce, external data systems.

Thinking through all three will ensure that you have a successful forecasting implementation.

People

Let’s start with people. First, think through what you want from your teams:

• How often do you want them to report back to the business on their results? 
• Do you want to get to the point where you trust their numbers? 
• Is it more important to build a system that allows you to scrutinize the deals at hand easily?  

Identify their training needs early on. The managers also need to be trained on how to submit an accurate forecast.

Cadence of Forecasting Reporting

There are a number of features in Salesforce that relate to the cadence of reporting. It’s important to understand how you want your teams to update their records and submit their forecast. Let me give you an example:

Most companies pick Salesforce as a solution to bring order to the chaos of data, but it comes with risks. The first risk is that the data is out of date, kept in a spreadsheet, and inaccurate. Another risk is data manipulation, with sales deals not being accurately represented by the sales teams. 

Forecasting in Salesforce is driven by underlying opportunity data which allows a greater enforcement of business rules and helps prevent inaccuracy and – as a result – an inaccurate forecast. By keeping the data solely within Salesforce, there is an auditable record of the information. This makes it much harder to manipulate and easier to collaborate.  

Reliable forecasts are required by leadership teams and support the overall sales strategy for the organization.

Relationship of Sales to Their Leaders 

Relationships in Salesforce forecasting are determined by the forecast hierarchy. Forecasting assumes you have built out a role hierarchy in Salesforce. It actually must be done by you first before creating a forecast hierarchy.  

I’d recommend reading this Salesforce Ben article on setting up roles: 

A team could be composed of one manager – for example sales director, and reporting to that sales director could be various levels of salesperson (business development manager, regional sales manager, account executive). Decide which roles are forecasting managers. It is important to note here that there is a technical limitation that you can only have one forecasting manager per rep. The manager has ultimate ownership of their subordinates and Salesforce doesn’t allow this to be shared.

Adjustments and Judgement Settings

Ask your managers how they override or change the values of deals. Salesforce has features like adjustments and judgments that can allow forecasting managers to adjust the deal values. This can give a lot of power to managers, but consider how they would be used before setting them up in Salesforce.

Process

Sales Methodology

Are you using a sales methodology? These could either be something that was created at your company or a sales methodology that is more established (MEDICC and MEDDPICC are good examples). Either way, you want to ensure the forecasting system that you plan to set up can work in conjunction with the methodology that you have selected.   

Using MEDDPICC as an example, it would first be important to ensure that at each stage of the opportunity the fields on the page layouts support the sales process. This will allow leadership to assess each deal at each stage to understand its completeness and quality based on the MEDDPICC methodology.  

Furthermore, it’s possible to build reports and dashboards to assess the quality of these deals and understand where there are gaps. I recently worked with a client that built out a custom Lightning Web Component to quickly assess at the deal level whether the opportunity was complete by scoring it based on MEDDPICC criteria. 

This visually flows very nicely into their forecast. A deal with a high score justifies its stage and forecast category as it makes up the total of the sales rep forecasting that particular deal. Moreover, reports and dashboards allow you to audit deals based on your sales process and drive sales team behaviors. 

Quotas

Quotas can present a unique challenge for organizations that may not have solid structures in place around Sales compensation. Salesforce forecasting allows you to add quotas manually or add them as a file (note the CSV file and the quota need to be monthly, not annual).  

When considering using quotas, there are a few things that should be considered: 

1. Do you want to use quotas? Do you want your sales team to see the quotas of their colleagues? If your answer is no, that’s fine; Salesforce supports this. Just make sure to understand the requirements of the business.
2. Are manager quotas primarily determined by their subordinates? If they aren’t, gather as much detail as you can in your requirements to ensure you are building the system to match their requirements. Generally, Salesforce forecasting works best if quotas work bottom upwards.
3. Do managers own their own deals and how are their quotas composed? If yes, ensure through testing that managers are seeing their deals, and the deals of their teams, correctly. Also, do managers need to see forecasts weighted by their probability %, or just the raw numbers, or both? Ensure that you’ve defined this requirement in advance.
4. How do you handle deal splits? Are these done across teams and regions?

Technology

Analytics and Reporting Requirements

Salesforce forecasting uses the data that is already within your CRM. As is often the case, the more data that you hold in Salesforce, the easier it is to run a forecast. In preparing for a forecasting implementation, it is important to have upfront conversations with the business first. Confirm in advance that the business is not relying on external data or spreadsheets that live outside of Salesforce for their forecasting and reporting.

Consider these five points:

1. What types of reports will the business expect from the forecasting system? 
2. Do you need to track changes to the forecast over time?
3. Are there rules in place for close dates on opportunities?
4. What decisions will you make (and who will make them) based on the forecasting data/reports?”
5. What are their expectations around data in the system? For example, do they require integration with a professional services system like Kantata? Look out for key data that lives outside of Salesforce driving change to opportunities, deal value, close dates, and milestones, all of which can cause additional complications in your forecasting implementation. 

The reason that this is so important is if you have bad, untrusted, or missing data in the CRM system that relates to your deals, then the accuracy of the forecasting will be lowered. Many businesses aren’t measuring their forecast accuracy so continued bad deal data fuels a frequently inaccurate forecast. 

For example, on a weekly forecasting call, the business may forecast $10M of deals. But in reality, only $2M close – that’s a 20% accuracy rate. Is this acceptable? If not, what needs to change in the sales process to improve accuracy?  Leadership needs to have deep trust in the forecast and the teams that are putting the data into the CRM to drive the business. An inaccurate forecast means it is difficult to plan for the immediate future (how can leaders decide where to spend/allocate resources, etc. for the business).

Using analytics to review the data that is driving your forecast allows them to be more accurate and the accuracy to improve over time. For example, recent changes to Salesforce allow the tracking of pipeline movement into and out of forecast periods. Salesforce continues to invest in better pipeline management. Pipeline Inspector and other tools continue to reduce the need for custom reports and dashboards on pipelines, and a more accurate pipeline drives a more accurate forecast.

Lastly, once you’ve configured the forecast settings, do thorough testing – not only with RevOps but your sales managers and reps. Once all the settings are defined and locked, document your setup, and remember, it is best practice to not change it will impact past results.

Summary

Salesforce forecasting is relatively simple to set up, however, the need for business preparation to implement it is very high. Separating your readiness into these three categories (people, process, and technology) will allow your organization to better prepare to implement forecasting and ensure success.