Forecasting. It’s not just for Sales.

My team gave me some interesting feedback when I mentioned we would start forecasting expansion and risk.

I heard comments like…
 

"What's that?"
"Isn't forecasting a sales activity?"
"Our customers don't want us to sell to them."

In a typical sales role, forecasting refers to predicting and estimating future sales performance, typically over a specific period (e.g., a month, quarter, or year). It's an essential part of sales management and planning. Accurate forecasting helps set realistic targets, allocate resources efficiently, and make informed decisions based on data to achieve sales objectives.

For Customer Success Managers, forecasting plays a crucial role in predicting and planning how to effectively manage customer relationships and ensure the success and satisfaction of your customer. Forecasting in a Customer Success role is proactively addressing customer needs, identifying potential risks, and allocating resources to achieve positive outcomes for both the customer and the organization.

Now that we got that out, here's how I implemented forecasting with my Customer Success Managers. And it's not just doing the forecasting activity; it's reporting the data to upper management. That's where the visibility of your efforts is seen through a different lens. 

As you continue to read on, keep in mind:

• As a Customer Success Manager, you are being introduced to a customer journey that has already begun. Onboarding is a step in the customer journey but not the first step.

• Contract terms will also be a factor. Customers who sign you for a one-year vs. a multi-year term may benefit from an accelerated onboarding process to achieve their goals and experience the value of the partnership much quicker.

I started the process by asking the team to identify customers with contract term dates three quarters ahead and ask themselves these questions:

• Do I know my customer's current needs and goals?

• Do I know their plans for the future?

• How are they using the product or service today?

• What's the current landscape of competitors?

• Have there been any personnel changes?

• What is the economic outlook, specifically for my customer's vertical?

• Where are they spending money today? 

• What are they budgeting for?

• Are they planning any major changes to their business?
  What challenges are they facing that could impact their growth?

• How do they view your company's brand? 

• Your company's support?

If they did not have all the answers, this was the perfect opportunity to begin or strengthen the partnership and empower them to be professional and curious in their engagement and investigation for answers.

Now, let's talk about reporting. My Customer Success Managers were able to logically and succinctly (using a template that one of my CSMs curated) report the health of their book of business for the following quarter based on the data they gathered from their customers, the percentage of risk they assessed through lack of adoption or engagement and the expansion opportunities from the new information learned throughout their interactions with the customer. 

This process provided the Customer Success Managers with the following: 

• A sense of ownership of their book

• A proactive strategy to target any risk

• The ability to support the customer's expansion journey and keep them on track with their desired growth milestones.

There are several Customer Success tools today where this function is automated. The tool I prefer is the ClientSuccess platform. The ClientSuccess platform provides several features that support forecasting activity, including:

• A centralized repository of customer data, including information on customer usage, engagement, and satisfaction. This data can identify customers at risk of churn or who may be interested in expanding their relationship with your company.

• Forecasting tools to help you estimate future revenue, renewals, and expansion opportunities. 

• Reporting to track your forecasting accuracy and identify areas where you can improve. These reports can be used to share your forecasting results with stakeholders and make informed decisions.

The point is that I began the process before our team had a tool or one with a reporting function integrated with other internal platforms.

If your customers are forecasting (and they are!) whom they will partner with to help them reach their goals now, whom they will trust to help them achieve their goals in the future, and who is perceived as a trusted advisor and provide long-term value, make sure that person is YOU!

CALL TO ACTION
 

• It is important to remember that forecasting is not a one-time activity. 

• It should be an ongoing process regularly updated as new information becomes available.

• It is also important to be realistic when forecasting. Don't overpromise and underdeliver.

• Finally, it is important to use forecasting as a tool to help you make informed decisions about how to support your customers best.