Pulse Analytics Module: Breakdown By Stage or Forecast Category- which is more accurate?

When using Pulse, have you found yourself wondering which breakdown option is better or would give more accurate projection? If yes, read below to learn more 👇
 

Well, before we get into the details of which is better, it’s important to understand why the projection is different for each breakdown. The reason is Clari’s AI projection is based off of historical conversion rates and these conversion rates vary by Stage and Forecast Category (you can leverage Clari’s Trend analytics module to understand this better- for example, try changing the breakdown from Stage to Forecast category and see how the conversation rates change)

That said, the answer here really depends on your rigor or how well the forecast categories or stages are managed (CRM hygiene/discipline around these) and differs for each org. Meaning, if an org follows stages closely with strong entry and exit criteria, Stage is the one to use. Conversely, if the Forecast Category is a more commonly used field, that’s the one to use.
 

One good way to check on this is to look in Pulse - Go back to previous quarters and check which breakdown is giving you more accurate projections compared to what you closed in that quarter (check for the last 3-4 quarters - to get a sense)

If you notice that one breakdown field produces a more accurate AI Projection (or a more accurate AI Projection earlier in the quarter), then it's probably a good idea to enable your teams on the breakdown field that doesn't seem to be as accurate or address any paint points your team is experiencing as they try to maintain a disciplined process around that breakdown field.

Ultimately, it's helpful to compare the AI Projection when you use Forecast Category as the Breakdown Field, and the AI Projection when you use Stage as the Breakdown Field to triangulate or pressure test your forecast. So, you'll get the best AI Projection if you have a well-defined process around both fields.

Note: Typically we see that Breakdown By Stage yields a more accurate projection than Forecast Category (given stages are more nuanced than forecast categories). For example: An opportunity with a Forecast Category of Commit can be in any of the mid to late stages so the coverage scope or variability of Forecast category is high and the conversion rates are not so nuanced affecting the projection). That said, this can’t be generalized and can vary from org to org
 

If you have any further questions, feel free to reach out to your CSM or Account Manager for more information