Sales Territory Planning & Quota Setting

Sales planning is a critical and strategic activity.


The importance of sales planning is not in question; regardless of the business one is in, sales planning is a critical and strategic activity. It looks into the future of a company to provide a vision of how business will unfold.

How much can we sell? How big should our market be next year? These are critical questions because their answers drive revenue and help determine the number of people you need to employ and pay and how much material or goods you will need to purchase in the time
ahead. Indeed, the volume of business drives nearly everything in an enterprise, and that volume is defined by sales.

Unlike other planning processes that are based on consistent factors, sales planning is subject to continual change. In today’s global markets, driven by volatile demand and serviced by increasingly distended and complex networks, that change is accelerating.


Proper Scope and Balance

One of the principal challenges of the sales planning process is determining the proper scope and balance to structure the task. If the process gets too detailed, chaos may ensue from the sheer number of figures being generated, as well as undue cost from the huge effort entailed to generate them.

Hard questions need to be asked: Are real benefits coming from the reports being generated? Are they providing the basis for control and execution of the plan?

If the process is too coarse, the lack of detail may provide nothing to drive the business forward. In the end, you might only know that your targets have been missed. So having the right level of granularity is key, as well as determining the right levels for what is subject to change.

Put simply, you need to figure out what is really needed. Many companies try to do this process using Microsoft Excel, only to find the effort frustrated by the technical limitations of the program. This often leads to static or blunted planning because it’s so difficult to use a large number of spreadsheets.

In fact, only Excel is not ideal for handling complexity or growth. The Excel scenario is often a nightmare. Financial departments or controlling teams often create an Excel template where sales personnel have to enter their planning for the period ahead. The sales representatives send these templates back to the team, which consolidates all the numbers. The process ends up being an extensive “back and forth,” which is both time consuming and error prone. It’s easy to lose track of correct data, and version control becomes an ongoing problem.

When companies abandon Excel and turn to more sophisticated database systems, the problem can often be the reverse: the natural tendency is to overdo things. Experienced and successful planners always look for the right level, strive to make processes easier, and simplify data structures to make sales planning smoother for users and management alike.

The ideal scenario often is to leverage Excel for its modeling capabilities and ease. Excel should though be just a part of an overall system that includes data integration, database, and security with Web and Mobile access.


Strengthened Planning

The sales planning process can be strengthened considerably by having a performance management component that employs a model customized to the sales process. This would include data structures that fit the planning process, tailored specifically to the

Further, multiple people should be contributing to the planning process. Instead of having a corporate guru punching in all the numbers, data should be collected from all relevant personnel (e.g., product SMEs, local or regional sales personnel). The level involved depends on company culture and size; but as a rule it’s preferable to involve more rather than less people in data collection, and for those involved to be bound to their figures by a strong commitment.

These people are typically less familiar with data structures, less technically oriented, and less
knowledgeable about the individual aspects of the planning tool; consequently, the more comfort afforded this group, the better and easier the process will go.

This means:

  • Not needing a specific data model to be set up
  • Having intuitive, easy-to-use input forms

Moreover, having a workflow in place is recommended, because if a large number of personnel are contributing, it is easy to lose control of who submitted data, which data was cross-checked, which went back for refining, which is final and should not be changed, etc. To control the process, a set workflow is essential to provide status of data and specify who is empowered to change it.


Conquering the Sales Planning Conundrum

Fact Sheet

 Jedox Sales Planning Model

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