B2B Sales Planning: By the numbers

Introduction

B2B sales planning in 2024 is a complex beast: increasingly complex buying cycles, more scrutinized spending and an increasingly automated buying process (thanks, AI) mean old sales planning tactics no longer work.

To help you understand how your peers responsible for sales planning are balancing territories and quotas in response to trends in the marketplace we spoke to Sales and Revenue Operations leaders and got a temperature check on the industry.

They shared with us where they’re making investments, where they’re performing well (and not so well), and more. The results are presented in this document, as well as insight from exec-level leaders from B2B titans like Tableau, 6sense, Gong, and more.

80% of organizations have higher revenue targets to hit in 2024

As always, targets are increasing - every organization is looking at ways to grow.

In a year following substantial layoffs across industries, training and technology are the two areas that have seen the greatest increase in budgets this year (outstripping increases in hiring and compensation packages). 

This signposts a desire to better leverage the people already in the team, rather than simply throwing money and headcount at the problem. Working smarter is always better than working harder.

Almost 40% of organizations are getting quotas and account targets out a month late or more

38% of those surveyed got their quotas and account targets more than a month after the start of the year. When we asked our leaders to estimate how much revenue they missed out on thanks to these delays, their answers (illustrated below) came out at around an average of 7.25% - if you’re doing a billion in revenue, that’s $72.5 million left on the table.

And you’re likely needing to hire dozens more salespeople just to hit your targets, adding complexity and cost.

These results tally with the fact 28% of respondents said the top reason they miss revenue targets is getting sales plans out too late.

Due to the complexity of the process, the amount of data to be considered, and the number of stakeholders, setting sales quotas can be very manual, and often ends up relying more on guesswork than data.

97% missed revenue/sales goal attainment last year

There’s plenty of room for improvement here. Data management was the number one issue impacting ability to hit targets, with difficulty collaborating in second place. 

Getting an accurate, up-to-date view of all your data sources should be an immediate focus for sales and RevOps teams: inaccurate & unconnected data results in incorrect assumptions when building a bottom-up plan. That can then lead to incorrect hiring plans, ramps, and targets: it’s a snowball effect.

Alongside that, the work sales and RevOps teams do involves a really broad range of people, and collaboration between them can sometimes be the most challenging part of the job. Organizations should look to find ways to bring finance, GTM operations, HR, and sales teams onto the same page.

One critical step here is for sales operations to sit down with finance counterparts and align on the critical metrics each team needs to track. It's ok for different functions to be looking at different KPIs, so long as these are based on the same underlying data. For example, Finance may be looking at realized revenue only while sales might be targeting committed deals.

Having a single source of truth for data is the top way to improve collaboration across go-to-market teams

The key to proper GTM planning largely lies in a company’s own data. 

A good start is for leaders to think about the details, however, in many businesses this information is siloed across numerous systems. Locating and cleaning this data up for analysis is often a complex, time consuming and painstaking process. Even after all that effort, information sets might still be inaccurate, outdated or incomplete, leading to mistrust in the outputs that feed into all sales plans.

By leveraging tools that help streamline data management and analysis, companies can start to unify their disparate data sets and use the information to more accurately plan and forecast for the year ahead. World-class sales planning processes cannot exist without central and field teams working from the same datasets.

As the year progresses, it also becomes easier and quicker to monitor performance, identify potential gaps or misses, and take steps to rectify or adjust plans. 

Economic headwinds continue to keep organizations on their toes

Change is a constant in 2024. Shifting macro-economic conditions has led to more than half of respondents (57%) facing increased pricing pressure, and 61% believing it’s harder to launch new products. In a bid to keep up, 61% are constantly changing strategies due to market conditions, and that’s reflected in the frequency with which plans are being updated.

In any given year demand and needs shift. Stakeholders come and go. New products are launched and antiquated products are sunset or become obsolete. Economic and geopolitical conditions fluctuate.

But when data is used to drive decisions, disruptions can be managed before they turn into catastrophes. Best-in-class organizations are always looking for more effective and efficient ways to “look around corners” - the most innovative are even leveraging AI models to optimize quotas based on account potential.

Early warning indicators can be utilized to identify off target patterns and trends, leaving room for timely data driven responses.  When critical moments do arise, leading organizations are able to react with a clear-eyed approach that is backed by accurate and trustworthy information instead of making rash decisions based on inaccurate data or gut feel.

Quota planning is the top area sales and RevOps leaders need to improve

Getting quotas “just right” is critical for any business. We’ve already seen that many struggle to get them out on time, but setting fair and balanced quotas is another key challenge facing sales leaders.

When quotas are set too low, that can result in more hires - which in turn means profitability takes a hit. It can also result in complacent sellers that may lack the motivation to push themselves. 

On the other hand, when quotas are too high it comes at the cost of productivity.  Ultimately, if most sellers consistently fall short the business is more than likely to miss revenue targets, sellers leave, and a vicious cycle kicks off which can be devastating and timely to recover from.

This can have a real negative impact on top talent: unfair and unbalanced territories (1) and quotas (2) were listed as the top two reasons a rep would leave the company. We explore attrition rates and the impact of them on the next page.

Attrition is a problem - rates are far above targets

Attrition obviously impacts short-term target attainment, but also hits long-term profitability due to significant re-hiring and re-training costs later on. It pays to keep hold of your staff.

The mean attrition rate at organizations surveyed is 28.2%, higher than the average target of just under 20%. Unsurprisingly, the majority of respondents (55%) believe that sales team attrition is impacting their ability to meet revenue and sales goals.

There are a number of different ways to tackle attrition - culture, compensation, training, and more. But one that we’d like to draw particular attention to is that salespeople are data-driven people. They need to have confidence that their quotas and targets are being set in a fair and sensible manner.

Data and methodology

Research for this report was conducted by Pigment using an online survey among adults in the United States between April and June 2024. Respondents were Sales and Revenue Operations leaders holding manager titles or above, with a 50/50 split between the two roles.

All respondents work at an organization with 1,000 employees or more and have decision-making influence in the sales planning process.

Your next steps

Based on the information in this report, there are three things you can do right now to improve your sales planning process.

1. Tap into the value of your data 

Effective capacity planning primarily depends on properly utilizing a company's own data. But in many businesses, information is fragmented across various systems. By adopting tools that facilitate data management and analysis, companies can consolidate their scattered data sets and use this information to plan and forecast more accurately for the coming year.

2. Use a platform that promotes collaboration and automation

Setting quotas and territories involves numerous stakeholders - the sales team, finance, HR, Sales/RevOps, and more - making collaboration highly complex and often delaying approvals. The solution is getting the right mix of technology, process, and people.

By allowing everyone to work from one single source of truth, you can simplify communication and allow actions and changes to be instantly visible to all parties. To avoid bottlenecks, organizations can establish workflows that involve the necessary personnel for specific actions, such as making a change and prompting another person to approve or deny it. A more collaborative approach has the helpful side effect that when people feel more involved in the process, they trust it more - which makes everything easier.

3. Stay ready for change

Change is pervasive but difficult. Fostering an environment where change is embraced, encouraged, and supported across functions can transform it into a growth opportunity rather than an obstacle. This results in a go-to-market team that is better equipped to meet its targets. 

By establishing the right relationships - within sales teams and across finance, HR, and more - when things are going well, you are much more likely to succeed at reacting quickly when things go off track. From the start, base your approach on data and acknowledge that you will receive new information and market dynamics will shift throughout the cycle. This foundation of trust will position your organization to effectively achieve and surpass revenue targets.

4. And finally...‍

Assess if Pigment is right for your organization. Pigment has been built by industry experts to address all of the points we touch on above.

Pigment has been built by industry experts to address all of the points we touch on above. To learn more, visit https://www.pigment.com/use-case/revops/.

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