Getting the Most Mileage from Your Annual Sales Planning Process

Q4 is an exciting and busy time for Sales Operations and Finance professionals as they embark on annual planning. Here, I will focus on short-range planning aka annual sales planning which is different from long-range or 3-5 year corporate planning.

Typically, organizations tackle many key business imperatives during sales planning: Reorganize the sales team by vertical or by geography? Increase quotas or decrease quotas? Hire more sales people to go after new markets? Invest in channel sales as a key part of go-to-market strategy? Increase or decrease investments in sales support resources?

Further, the hyper-growth phase at LinkedIn brings with it unique challenges with rapidly changing products and markets and opportunities to make smart strategic choices that will affect our business trajectory.

With so many different options to evaluate, how do organizations get the most impact on results through planning? As a Sales Operations or Finance leader quarter-backing planning, how do you ensure key stake-holders meaningfully engage in the planning process and lend their expertise and opinion? And how do you ensure that your teams don’t feel burned out?

Here are three key steps you can take:

1. Be Declarative: Early in the planning process, narrow down major strategic choices and then focus the analyses on these choices. Make sure the choices you are evaluating are truly strategic. A simple litmus test for what is strategic versus operational – strategy entails controversial choices and trade-offs that drive superior performance. Whether your goal is to gain competitive advantage or accelerate market adoption, you must act differently; make choices that are different from your competitors or what you might have done in the past. Let’s take an example here. A decision to organize your sales team by vertical is a truly strategic choice – to drive superior performance, you most likely have to pivot from horizontal product messaging to establishing intellectual leadership in specific industry verticals. Hence it would require significant trade-offs in terms of the types of sales professionals and managers you hire, sales training, sales process and planning for key support resources i.e. marketing and business development. On the other hand, a decision to roll-out a sales productivity tool to boost sales efficiency is more operational given the decision does not entail as many trade-offs.
2. Be Inclusive, Use Data to Drive Alignment: Strategy typically entails interrelated choices which might span different teams or organizations. Let’s take a different example here. How should you decide between investing incremental resources in lead generation versus pre sales? They are both key functions to drive the top-line – one drives pipeline, the other drives conversion rate and deal size. Essentially, you are trying to determine what delivers the most bang for the buck. How do you make that determination? Since strategy involves both formulation and execution – the “what” and the “how” – it is key to be inclusive and encourage active participation and dissent across different stakeholders. Inherently the decision making process involves difficult judgments in the face of uncertainty as there can be multiple plausible forecasts of future. As someone quarter-backing the process to make this critical resourcing decision, you have the opportunity to bring data and insight. What can you learn from your own firm’s history – trend on pipeline generation and win-rate? What can you learn from other industry players? E.g. Industry coverage ratio (Sales:Pre-Sales Headcount). As a Sales Ops leader, you add value to the process by building a strong fact-base and fostering discussion. Organize key stake-holders in different groups – have them take opposing positions and defend their recommendation.
3. Run a Tight Process: Unlike long range planning, annual sales planning is typically time-bound. At the beginning of the fiscal year, you want to build excitement among your sales team – plan a kick-ass Sales Kick-off, roll out new sales and marketing programs and dole out quotas. What constitutes a tight process? First and foremost, early in the process identify who needs to participate in the decision process and in what capacity. RAPID is very useful decision making framework which can be used to clarify roles and set accountability in complex, multi-functional initiatives. RAPID enhances transparency, prevents the process from becoming democratic, and helps keep a check on personalities while at the same time fostering efficiency, intellectual debate and innovative solutions. Second, identify dependencies early. Since strategy entails inter-dependent choices, identify which decisions need to be made first so there is no domino effect. Third, document key steps in a project plan and get alignment from key stakeholders on their respective roles, and time and resource commitments. Finally, make sure you debrief post planning and ensure key learnings are captured and put in to action for next year’s plan. Before you know, you will be planning again!

In summary, if run well, Annual Sales Planning provides Sales Operations and Finance leaders an opportunity to be creative and drive significant results – it’s a time to reflect on what can be improved, build better cross-functional relationships, collectively brain-storm, build a strategy and deliver a plan to bring strategy to life.

Munish Gandhi, is a Sales Operations leader in LinkedIn’s Sales Solution business.