October 23, 2009

Don't Rely on Spreadsheet Forecasts!

10 reasons to ditch your spreadsheets and employ a SFA/CRM system

Increasingly managers complain about the difficulty of accurately predicting what deals will close and when. However in spite of a more complex sales environment, most organisations still rely on spreadsheets to manage opportunities and forecast sales.

This short article outlines 10 reasons why a more sophisticated approach is required.

1. Forecast accuracy inevitably suffers using a spreadsheet because you have only limited visibility, predictability and control in respect of sales (opportunities, accounts, activity, etc.).

A few columns on a spreadsheet are inadequate to describe today’s complex sales.

2. Spreadsheet-based analyses are more subjective because they struggle to adequately communicate how, for example, an opportunity is rated.

Moreover, they don’t map opportunities to your sales process – e.g. has the buying group been identified/covered, has a formal needs analysis been undertaken, has budget status been clarified, etc.

3. Have you got the latest version? It is impossible to keep a spreadsheet based sales forecast or sales campaigns up-to-date. This is compounded with different versions being used across a sales team.

A spreadsheet only gives a snapshot at a point in time and is quickly gone out of date. It is not a collaborative working tool.

4. Spending too much time on reports? Managers who track sales using spreadsheets spend twice as much time in report preparation, so to do their sales teams. This is an inefficient use of time, given that most sales systems will produce reports at the press of a button.

Furthermore, it means that most face to face time between sales managers and their people is spent information gathering and reporting, as opposed to coaching.

5. Sales Meetings involving the use of spreadsheets are grossly inefficient – with updates being made line by line to different accounts, or opportunities for each sales in turn.

That means the sales meeting is caught up with detail that is irrelevant to most of the team and this distracts from the more strategic elements of a sales meeting.

While I am interested in talking about my own opportunities and how they are progressing, I don’t really need to know that the buyer in my colleagues number one account is away on holidays, or his main contact has just returned from a golfing holiday and that the results of the pilot project are being reviewed Thursday week. While it may be interesting to my manager, I would rather be out selling that listening to all that unnecessary detail.

No wonder that meeting involving such protracted opportunity reviews don’t finish on time!

6. Spreadsheets don’t trigger actions in a diary where an action is allocated to an account, or an opportunity and they don’t provide a record of the associated actions, emails, meetings and so on.

7. Managers should have dashboards at hand so that they can review at a glance their pipeline, identify priority accounts, and so on.

8. Too much information in people's heads. Spreadsheets are of little use if a sales manager or a sales person leaves as the understanding behind them is lost.

With growing levels of sales person turnover, it is vital that detailed account, contact and opportunity info is held in a central repository (a sales system, or database), so that it does not vanish when a rep leaves.

9. What does all the information mean? A spreadsheet will struggle to give a sales manager the metrics he/she needs, including the ratio of leads to meetings, or the win rate of proposals.

10. Who is doing what? A spreadsheet won’t adequately tell a sales manager where his sales people were, or should have been was last week, or where he should be next week. It won’t enable him to identify areas where the rep needs coaching either.


Managers want increased visibility, predictability and control in respect of sales. That requires a more systematic approach to leads, meetings, cycles and orders which has outgrown the capabilities of spreadsheet based sales forecasting, or reporting.

Thankfully, this is made possible by a wide variety of sophisticated tools, called Sales Force Automation, or Customer Relationship Management systems. Spreadsheets are not the answer.

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