FRI MAR 18 2022

Think beyond the Quarter: Why You Need to do Out-Quarter Pipe Building Now

by Bithika Bishesh

In today’s world, sales reps and leaders are interested in knowing how their current quarter is shaping up. And as every quarter comes to an end, they shift their focus on opportunities that are likely to close within the same quarter.

But here’s the problem with this approach- the Quota clock keeps ticking!

With the beginning of a new quarter, there is a new quota to attain and if you don’t plan carefully you may end up with a barren pipeline.

Eye toward the future

A pipeline creates a visual of where in the sales pipeline stages the sellers and the prospects are.

Which deals are stalling? Which sales activities are generating the best results? How many deals have closed in the past? How will this impact top-line revenue?

Overall, proper sales pipeline management helps you maximize your team and your resources by accurately forecasting sales, recognizing aggregate sales velocity, monitoring a team's progress, and more.

Every sales user would be interested to know how much pipeline one should have to meet their quota. While the focus on tracking the current quarter will always be a priority, it's always equally important to keep an eye on the pipeline that is generated in the next quarter as well.

Out-quarter pipeline is important because a slow start to a quarter can set you behind for the rest of the year. Entering a quarter with a certain amount of pipeline gives you the confidence to hit and exceed your revenue targets.

Let's say your next quarter’s quota is $10 million and you want to achieve 50% of your target.How do you know whether you have enough in your pipeline starting next quarter in order to meet that quota?

There are multiple pipeline metrics that a sales leader can use to drive his teams viz. Pipe Coverage, Average Sales Cycle, Attainment, Sales velocity, Conversion Rate and Win Rate. But an ultimate goal for most of them would be to maximize 'Attainment'.

Pipe coverage is oftentimes used as a key factor driving attainment rates, but it’s not the only one. Pipeline quality alongside coverage could help predict and explain the target outcomes in better ways. Hence our approach to pipeline analysis - given the attainment, here is the recommended target pipeline & coverage and the actionable insights for the next quarter.

Pipeline quality can be presented in a few different ways - composition by stage / category, active vs. stale deals, CRM hygiene, age of deals vs. amount, etc. At Aviso, we analyze pipeline quality in several different ways to represent them as input features to our ML models and test their relationships with attainment/pipeline conversion. With all these relevant factors and our best ML pipelines, we're able to predict next quarter's target open pipe much more precisely and accurately.

With Aviso’s out quarter forecast, we tell you how much pipeline you are generating in the next quarter and what should be your pipeline at the start of the next quarter in order to meet the next quarter quota.

Get a true understanding of Next Quarter opportunities

In the absence of an out quarter pipeline insight, teams tend to use generic coverage numbers (2x, 3x, and so on) to meet their quota. The problem with these ‘magic numbers’ is that they don’t tell you what this coverage is based upon.

Aviso’s Out-Quarter feature gives you a realistic shot at meeting your target quota as it gives you an understanding of your pipeline distribution. For instance, whether your pipeline is composed of new businesses or follow-through businesses; whether it’s an early-stage or late-stage pipeline.

Receive Actionable Insights into Next Quarter’s Pipeline Health

With Aviso's ability to retrospect and peer into the past eight quarters, teams can predict for three upcoming quarters at any point in the given quarter. Get insights on deals that have been successful in the past and get a better understanding of what caused that success and how to implement that across your pipeline to improve your overall effectiveness.

This way, teams can stay motivated while ensuring that they're well-prepared for their upcoming revenue targets.

  1. Analyze variance in sales rep’s performance and get active oversight of sandbagging deals or overestimated deal size.
  2. Identify and replicate high performing scenarios to improve pipeline velocity.
  3. Get insights on Late-stage and Early-stage pipeline- This is particularly useful in two scenarios- If the overall pipeline is not enough, but most of these are in late stages then you can keep focusing on creating net new pipeline to backfill the pipeline that turns into revenue. On the contrary, if you have enough in your overall pipeline but most of these are in early stages then instead of creating net new the focus should be on deal acceleration.
  4. Quota Attainment- Know what the target pipeline should be at a given level of attainment. Armed with these insights, get a true understanding of:
    • Pipeline required in the next quarter to attain your Quota and whether you are on track to attain your quota or you are going to miss it.
    • When to scale back your efforts for this quarter and start laying the groundwork for a successful next quarter.
    • Spot risk early by taking a real-time look at coverage gaps.
  5. Compare your next quarter’s average deal size with that of the past quarters to forecast how many deals need to be closed to meet the quota. In addition, look out for any salespeople whose average deal size is significantly lower than the team average. This may mean they’re going after low-hanging fruit and need to push themselves to target more competitive or larger customers. Alternatively, they might be discounting too aggressively.

Interested in knowing how Aviso can help you drive more conversion and incremental growth? Sign up for a free consultation with our experts and we'll reach out to you.