‘Who is responsible for the sales forecast?’ was discussed on Linkedin and it had great participation, but variation in answers. The author surveyed all the answers (I suspect ~100 responses) and the results were:
- 66% thought sales managers are responsible
- 6% thought salespeople are responsible
- 28% thought both are responsible
My response: there needs to be an additional category, the VP of sales (or highest “sales department” leader in the organization). They are responsible for the sales forecast based on their downward leadership to sales managers and their direct reports.
Agree or disagree? Share your thoughts below. Here is my justification:
The salesperson cannot be held responsible for a forecast of their performance until they understand what a forecast is based on. Imagine you’re in a group of 20 salespeople and you’re all asked to provide a forecast. You look to your right, then to your left…you may think “are they going to forecast based on the same “gut feeling” as I am? Won’t we all be different?”
In that scenario, I’m betting you know your opportunities better than anyone else on your team, including your sales manager. However, until the group is guided on what to base a forecast on, the integrity of that forecast is at huge risk. Once that’s established, then accountability comes into play (different topic entirely).
The middle sales manager cannot be held responsible for gathering a forecast to provide upper management until they can look at a sales opportunity in unison and know where it’s positioned and what to do next. Image if you had to manage 5 direct reporting sales reps and combine their forecast to send to upper management. Of those 5, Bob’s forecast may be more aggressive than Mary’s, who is more conservative than Paul’s, who is a more “seasoned” salesperson than the new hire Joe, who is being trained by the veteran Sarah. This is why it’s critical than the sales department leader (VP, CEO, etc.) is involved.
The VP of sales (or highest ranking sales leader) IS responsible for the forecast and how everyone underneath them is determining their individual, or team’s forecast, in a similar fashion, based off of the same data (not emotion) within a sales opportunity.
It’s not uncommon for a sales leader to say “I never want to go back to the board or CEO and tell them we lost a sales opportunity that I forecasted.” The VP needs to implement the ground rules and process that each manager and salesperson can apply to their sales opportunity and non-emotionally determine where they are positioned and the real probability of moving it forward. Until this happens, “gut feeling” and variation will lead to poor forecast integrity and mishandled numbers.