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What are the best forecasting practices for public companies when they see a large growth deal entry the pipeline?

  • 17 August 2022
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T
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When forecasting a large growth deal. Example moving from 60K to 1.8 Million. Which strategy to you prefer your teams to leverage form you c-suite lens?

 

If the customers buying signals are showing a 1.8M growth opportunity would you prefer we forecast the stretch goal of 1.8M and reduce as we gain more insights into team needs or would it be more useful to start modest at $500K and increase the forecast as you work to confirm MEDDIC and secure executive buy-in?

 

Tom 

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Best answer by JoshM 17 August 2022, 23:54

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JoshM
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Hi Tom! From my experience and also in working with some other customers, my preference is to start modestly and expand as the seller qualifies it further; runs it through your sales methodology, and gains confidence throughout your engagement with the buyer/customer. It is much easier to justify growth and expansion after additional qualification and sales rigor, then it is to start with a large stretch possibility and decrease it after learning more. It also helps lock in your C-Suite’s confidence in the qualified funnel as a reflection of winnable business. 

jessica_starr
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Hi @Tom Carter ! Really interesting question. I agree with Josh’s answer. One thing I’ll throw out there is at Clari, we have an extra amount field to capture the ‘swing’ / ‘upside’ amount. This has been a really effective way for the team to communicate that a deal may be $500k, but could go up to $1M. 

Kenna
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Hi, @Tom Carter! Tagging a few execs in our community in case they have a take on this to share.

@txsalesldr @Lydia Winn @Bret Libigs would love your perspective on how you prefer to see your teams forecast deals with big upside potential!

Kenna Valdez, Manager, Customer Community, Clari
Danislav Spasov
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Hi @Tom Carter ! Really interesting question. I agree with Josh’s answer. One thing I’ll throw out there is at Clari, we have an extra amount field to capture the ‘swing’ / ‘upside’ amount. This has been a really effective way for the team to communicate that a deal may be $500k, but could go up to $1M. 

Hi Jessica,

 

Can you show/advised where is “we have an extra amount field to capture the ‘swing’ / ‘upside’ amount”.

I haven’t seen this. Thank you.

 

jessica_starr
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Hi @Danislav Spasov !

Here’s how we’ve set up some of our key amount fields: 

  1. Net New Average ARR —> main amount field tied to the quote 

  2. Upside —> reps enter the ’swing’ amount of the deal in this field 

  3. Net New ARR Average Upside —> automatically calculates ’Net New Average ARR’ + ‘Upside'

This set-up makes it easy for reps to communicate the potential spread, and helps us forecast our ‘Best Case’ forecast call.

Here’s how it looks in a demo environment in Forecasting (not exactly the same as our set-up, but hopefully gives you an idea):

 

Let me know if that’s helpful. 

Jessica 

Danislav Spasov
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Hi @Danislav Spasov !

Here’s how we’ve set up some of our key amount fields: 

  1. Net New Average ARR —> main amount field tied to the quote 

  2. Upside —> reps enter the ’swing’ amount of the deal in this field 

  3. Net New ARR Average Upside —> automatically calculates ’Net New Average ARR’ + ‘Upside'

This set-up makes it easy for reps to communicate the potential spread, and helps us forecast our ‘Best Case’ forecast call.

Here’s how it looks in a demo environment in Forecasting (not exactly the same as our set-up, but hopefully gives you an idea):

 

Let me know if that’s helpful. 

Jessica 

Thank you so much for showing me this.

Much appreciated!

M
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Hey Tom - 

Here’s what we do internally:

-Forecast the conservative amount (the key for me is having a strong POV on how we’re getting to that amount.  ie/confident they’ll move forward with XYZ product @ $X amount.  Upside in addtl personas or products equals $Y). 

-Input the conservative amount as “most likely” and represent the addtl amount in “upside”

-We put these notes in the actual notes section of the forecast module and at the opportunity level so execs have visibility/insights into why there’s a large swing and what actually makes up the upside amount 

 

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