Leadership Sales

Next-Level Sales and Pre-Sales Annual Planning

Sales and Pre-Sales Annual Planning: Two Approaches

The approach is two-fold.  Bottoms-up forecasting, starting with people and ending with a Top line revenue target; or Top-down, starting with a revenue target and fitting people into this target.

For pre-sales and sales, the main focus is ensuring you have enough Account Executives to cover the revenue targets and that those Account Executives have enough SDR and/or Solution Engineering support to cover the pipeline needs for the revenue targets.  

A secondary focus that tends to get less attention is marketing.  Specifically, is marketing bringing in enough leads to support the sales targets? Usually, your marketing and sales leaders work together to decide what portion of the pipeline will be covered by marketing vs. pure sales outreach. We’ll touch on marketing in part II of this series. 

When you look at these two focus areas, it would appear that from a planning standpoint, you only have a little to be able to move around besides the hiring dates of the people needed to execute. And that’s mostly true, but there are 4 other main levers that pre-sales and sales has a lot of control over. 

  • Ramp Time
  • Average Selling Price
  • Sales Cycle
  • Conversion Rates

Ramping up your account executives and SDRs (and SE if needed) quickly is essential to delivering  revenue to the business.  Below are a few focus areas to positively impact ramping time:

  • Sales Enablement Focus
  • Hiring dates and training plans
  • Configuration of the pre-sales team

 Ramp time is commonly overlooked. Further, not a lot of change management is set aside to improve it.  If your company doesn’t have someone dedicated to sales enablement, specifically how to get the sales department selling, then incremental improvement can’t be expected. Can you imagine being able to train a sales representative 20% faster? The impact on productivity numbers, when you will hire, and what size team can’t be emphasized more. 

Do you have Solution Engineers? It’s possible to find that it takes an extended time to train SDRs on a complex product, but maybe it’s time to look at hiring your first solution engineer to dive deep into the product.  This saves a lot of the complexity for the small portion of prospects that need it while your SDRs are now trained to be much faster and scalable. Training, efficient hiring plans, and having the right support are critical to decreasing ramp time. 


Sales can impact average selling price in a few critical ways:   

  • Provide more value
  • Increase Prices
  • Go Up Market

First, you can only expect to sell more if you provide more value. Providing more value only sometimes means more features or functionalities, but could be a different persona or market segment that values your products or services more. Honing in on the portion of the market that provides your sellers the highest selling price is a tried and true way to drive up the average selling price.  

Another avenue may be price increases, but this can be a lot harder depending on your customer’s usage. Typically,  if your customer can’t do without your product for a week, reasonable price increases will not drive off good customers.  

Flip that scenario around, however, and a price increase could drive good customers away to competitors.

Lastly, “going up market” is a plan that many companies can strive to achieve, but if you started at the lower end of the market, going upstream is major change management that would likely require resources your company does not have from a hiring standpoint.  This means your company would probably have to hire an entirely different sales team to support significantly larger prospects and selling cycles. However, with investment, patience, and a solid up-market strategy, this could be a viable way to increase the average selling price.

Compressing the Sales Cycle

The sales cycle can be compressed, but it has to be done sustainably:

  • Find segments that will buy faster
  • Measure milestones in deals and find what steps can be compressed
  • Eliminate any unneeded friction in the buying process (online payments and digital signing)

Finding a segment that will buy faster is the ability to identify a major pain point in your buyer that has an extreme impact if solved quickly.  It works when time passing is painful for the prospect and you don’t have a cheaper competitor they could go with instead.  If your prospect isn’t in a hurry to buy, this isn’t going to work and your product either can’t create urgency this way or the wrong ICP has been targeted.  

Measuring milestones in the sales cycle is critical because it allows you to know the duration of each stage and if it is necessary for the sales cycle or if it can be compressed and or eliminated. Using timestamps in SFDC is the easiest way to analyze this (you can use history reports, but they are a pain). This also assumes you are using best practices and have a linear sales process in place to measure the time between stages. 

Eliminating unneeded friction can be as simple as putting your contract in a digital signing platform and accepting any form of payment possible. Accept checks, credit cards, PayPal, ApplePay, whatever you can.  Make it easy to sign and easy to pay.  This can shave off days and sometimes weeks off of the sales cycle. 

Improving conversion rates can be achieved, but tracking and governance are key. Below are a few steps to follow:

  • Align your funnel to forecastable stages
  • Create reports that use these definitions
    • Channel conversion rates vs People Conversion rates
  • Design Dashboards that instantly update

Aligning Marketing and Sales 

Getting together the teams responsible for the prospect funnel, namely marketing and sales, is imperative to ensuring conversion rates can be monitored and improved. Every stage in the funnel does not need to be tracked for this purpose, but usually 3-4 stages need to in order for conversion rates to be forecastable.  An example would be if all lead stages were tracked, then daily conversion rates from lead stage to lead stage would vary wildly depending on the amount of traffic, day of the week, and other factors. This variation makes it difficult if not impossible to forecast. To get around that, each week, measuring all leads and comparing that to the number of appointments set up and then the number of demos run and finally the close rate, you’ll find your conversion rates won’t vary as much and you’ll be able to improve them over time. Using data that fluctuates too much will give false signals on what is working and what is not.  

Conversion rates should be calculated weekly and monthly using channel conversion rates and people conversion rates. 

Channel conversions are calculated using only the channel that carried the lead along the prospect journey. People’s conversions are the same except you aren’t worried about where the lead came from, but who actually worked the lead. You’ll find when you break it out this way, certain people will be better at converting from different channels. This allows you to focus people on the channels that work for them and not assume your best channel works the same for your entire sales team.  This is almost never the case. Doing this will allow you to improve your conversion rates for each person and channel, which in turn improves the overall conversion rate. 

Performance Dashboards 

Dashboards are one of the best and most transparent ways to hold teams accountable for performance. Daily reporting is okay as long as the team knows the weekly or bi-weekly trends are what the team should use to pivot strategy instead of any daily spikes driving decisions.  Lastly, find your industry average and make sure you aren’t trying to get a higher conversion rate than what is typically seen.  If you’re already closing 70% of the deals that are in the sales cycle, then you should probably focus on a different area to improve. 

Key Takeaways

When average deal size, sales cycle and conversion rates are focused on, then the operational side has a lot more input. Providing the hiring plans they need to achieve their target is only the beginning.  By improving average deal size, sales cycle, and conversion rates, you are essentially making sales a force multiplier allowing your team to do more, with less people.  

This level of transparency also allows better and more cogent conversations with the other parts of the business if something isn’t working.  What assumptions were made that are causing the disconnect?  We either didn’t hire enough people, we set our conversion rates too high, we weren’t able to sell for at least our average price or we took a lot longer to sell than we anticipated.  

Stay tuned, the next article in our series talks about planning from a marketing perspective.

Video of building a plan from scratch for all departments: