Creating and unlocking value in an organization starts with knowing precisely where things stand, and where the opportunities for improvement lie. To help, SAP’s Performance Benchmarking group publishes a short analysis each Monday, highlighting hot industry topics and high-impact strategies. This week’s analysis focuses on the impact of better sales forecast accuracy on sales achievement and ways to improve sales forecast accuracy, and is written by Nilotpal Kumar.
KEY QUESTION: Are you accurately forecasting your sales?
KEY TAKEAWAY: For sales organizations, accurate forecasts can spell the difference between success and failure. Indeed, our benchmarking analysis shows definitively that better sales achievement is a function of better sales forecast accuracy, with top performers scoring better on both metrics as compared to average levels. For companies looking to improve, research shows that sales organizations can improve their forecast accuracy by integrating sales planning with manufacturing planning and supply chain management. According to our analysis, doing so correlates with an 11.5 percent improvement in sales forecast accuracy. Even more impactful, aligning organizational objectives with sales strategy concerning planning and forecasting is linked to 18.2 percent higher sales forecast accuracy.
Note to ASUGNews.com readers: SAP’s Performance Benchmarking program is a strategic service sponsored by its Value Engineering organization. Originally launched in 2004 together with ASUG as a forum to exchange metrics and best practices, the program today has grown into a global effort and one of the largest such programs in the industry—with more than 12,000 participants from more than 4,000 companies and studies available in 12 languages. Participants receive—free of charge—customized and confidential benchmarking comparisons against industry peers as well as aggregate analyses. To participate in the SAP benchmarking program, visit https://valuemanagement.sap.com.