Sales Planning & Forecasting

This scenario addresses the following business challenges:

1. Limited insight into sales and marketing programs
2. Can not proactively manage the sales cycle to avoid surprises or shortcomings during the sales cycle
3. Have no insight into where deals breakdown (why sales or lost or won)
4. No insight into the effectiveness of lead generation activities 
5. Organizations must tightly couple their sales plans and forecasts with manufacturing, planning and scheduling, and supply chain processes to ensure enterprise-wide collaboration
6. Without accurate forecasts, companies risk generating excess inventory, which can result in offering products that customers do not need or want

The next section describes the scenario in more detail:

This business scenario outlines the sales planning process as an integral part of CRM Analytics, a tool for measuring, predicting and optimizing customer relationships. The Sales Planning and Forecasting functionality within CRM Analytics enables vendors to concentrate sales efforts on the most profitable customers and products by supporting an effective, intuitive, and integrated planning process. Sales Planning and Forecasting combines these tasks into an integral and coordinated planning process that incorporates all the requisite roles from strategic planners and sales managers to sales employees, as well as external parties.

Sales managers receive company targets from the strategic planner and convert them into sales plans for their teams. 

External data providers supply market research data to these teams to enhance sales analysis and planning. This enables managers to ensure their sales plans are aligned with global and local market and competitive conditions. 

In a next step, relevant data from different sources is captured and integrated into a customer knowledge base. This base allows you to apply analytical methods to measure and optimize customer relationships. You can deploy the analytical results to improve your planning and the customer interactions.   Then you can translate the company targets into concrete strategies.

The Balanced Scorecard approach connects your strategic targets with your business management systems in marketing, sales, and service. 

Your sales managers break the targets from top management down to a more detailed view for their sales organization. The figures are distributed top-down to a lower level of aggregation. 

The individual sales employee then performs the operational planning. They take the management figures as the basis for their planning at the sales organization level and plan individual business partners or business partner groups, products or product groups for each planning period. 

Your partners should then approve the sales planning figures. Partners such as channel managers, distributors, or suppliers oversee their own related planning activities. They need access to operational and analytical data to plan, analyze and monitor the indirect channel business which represents between 40% and 70% of most enterprises’ revenue.

Your supply chain planner forecasts and plans demand in consideration of the market-driven sales plan, marketing events, historical demand data, causal factors, and market intelligence. Goal is to develop an overall supply plan that takes into account all procurement, production, distribution, and transportation requirements.

After this, your financial planner establishes your financial targets and calculates the expected profit.  The financial planner monitors the actual costs and revenue as the plan is executed as well as aligns plans with corporate strategy. Finally, the planned business from the preceding planning processes is used as the basis for evaluating overall profitability.

Once the plans have been reconciled and approved at board level, they can be re-submitted to the sales employees to be put into action.

All employees update the plans regularly using information about the actual market situation and the constantly moving planning horizon. The closer the planning period, the greater the need for more precise planning.

(*This scenario is written from the perspective of you as a Vendor)

This business scenario is supported as of SAP CRM 4.0.