Why forecasts miss
Two failure modes dominate. Sandbagging: reps lowball to beat the number, so leadership flies blind. Happy ears: reps believe every deal closes, so the forecast is a wish list. Both come from forecasting on feelings.
Forecast three ways and compare
No single method is trustworthy alone. Run all three and look at the spread:
- Weighted pipeline. Each deal's value times its stage probability. Fast, but only as honest as your stage hygiene.
- Commit / Best-case / Pipeline. Reps categorize each deal. Commit = "I'd bet my job." Best-case = "realistic stretch." The gap between them is your risk.
- Historical run-rate. What you've closed per quarter recently, adjusted for trend. A sanity check against the bottom-up numbers.
When the three disagree wildly, that's the conversation to have — not which spreadsheet to believe.
Probability must come from data
Don't let stage probabilities be made up. Pull historical conversion: of all deals that reached "Proposal," what fraction actually closed? That is your proposal probability — usually far lower than the optimistic default the CRM ships with.
Inspect the deals that move the number
80% of forecast error lives in the largest 20% of deals. For every deal above a threshold, require: a confirmed close date, an identified economic buyer, and a mutual action plan. No mutual plan, no commit category.
Track forecast accuracy itself
Each quarter, log what you forecast versus what closed, by rep. Chronic over-forecasters and sandbaggers both reveal themselves over a few quarters — and that's a coaching signal worth more than any single deal.