Revenue Projection Defined

Revenue Projection is an expected billing level for existing customers by month for the next 12 months. The algorithm takes into account different seasons and trends related to customers' behavior. Projection can be calculated from billing history and represent a light version of forecasting.

The actual forecasting is much more complex tool that takes into account the changes in business environment, changes in client companies (revenue or profit changes, etc.), sales pipeline and risks of defect. However, projection is already enabling data-driven decision making much better than intuition and experience.

VALUE & BENEFITS

OFFERING BUDGETING AND GOALS

From CFO and Offering Management point of view, projection gives an outlook on the next 12 months and the likely outcome of it. This supports budgeting well, because it gives an outlook on how things are developing if everything continues as they have been done so far.

If the outcome doesn't look good enough, Readiness and Risk as well as Growth Planning (Ideal Customer Profile) will help define what and how should be changed in order to exceed the projected outcome. Projection is a living figure, which means that in case customers defect or new customers buy more, these impacts will be projected for the next 12 months. This allows CFO and Offering Management to stay constantly tuned with what their annual outcome looks like.

SALES MANAGEMENT, GOALS & INCENTIVES

Each business ID has it's own billing projection for each month. Projection of all named accounts gives an outlook on total outcome of all accounts the sales person is responsible for. According to Salesforce's State of Sales 2023 study, the most important reason why Salespeople resign their jobs is unrealistic expectations. Sales people know their accounts and what is possible to accomplish with them, in case the goals are set homogeneously for all salespeople, the outcomes might be wildly unfair.

Example:

• Salesperson 1: Projection is a 20% growth with a 10% growth goal, which means that this salesperson will certainly meet and exceed his/her goals. Happy days :)
• Salesperson 2: Projection is a 20% decline with a 10% growth goal, which actually means a 30% growth in order to meet the quota. This salesperson is likely to feel hopeless and to resign and change employer.

According to our customers CSOs especially the younger salesreps require answers: "What is this quota and goal based on?" "How can I meet these expectations?". We have developed tools to answer these critical questions: What to sell to whom, when and why?

Projection is a constantly evolving figure, which means that in case the salesperson wins new accounts or services (up-sales, cross-sales, new customer acquisition & retention), the projection also updates and gives hope for success. The earlier in the year the positive changes take place, the stronger impact they have on annual success. 

TAKEAWAY

Projection is a budgeting and goal setting tool and an inspiring monitoring tool for C-level overall view as well as offering and account management. Other tools like Growth Planning, Ideal Customer Profile, Ideal Offering Profile, Risk and Readiness provide insights for priority and change planning and a view to changes: "How are our changes impacting, what outcomes they drive?". If the projection doesn't meet the expectations, other tools will help you exceed the projected outcomes.

The 180ops value promise is to provide you with answers about what to sell, to whom, when and why. These answers bring clarity to the most burning question: "How can I meet my quota and goals?"