Modernize Your Forecast and Call With Confidence

00;00;12;16 – 00;00;39;09
Speaker 1
All right. Welcome, everybody, to this episode of The Race to Revenue. I am thrilled to be joined today by my friend Patrick O’Leary from Alegeus. He is the VP of Growth Strategy and Operations. And we’re talking today all about how to think about your forecasting and how to modernize your forecasting. So we’re gonna focus on that. We’re going to talk about how your revenue teams can do more with less, especially important in these trying times with the tough macro environment.

00;00;39;14 – 00;00;53;08
Speaker 1
And then finally, we’re going to talk about streamlining sales processes. In the spirit of growing through adversity. So welcome, Patrick. Honored to have you here. Can you tell us a little bit about yourself? Tell us a little bit about Alegeus.

00;00;54;10 – 00;01;29;01
Speaker 2
Absolutely. Absolutely. So thanks, Kyle. It’s great to speak with you as always. Really, really looking forward to the conversation today. So just kind of a quick overview of myself. So I’ve spent a good amount of time in kind of the commercial excellence rev ops sales ops, etc. type spaces over the course of my career. And right now I’m with Alegeus really kind of enjoying, enjoying my time with Alegeus working on working on HSAs, FSA, and all these sort of kind of flexible benefit spending accounts.

00;01;29;01 – 00;02;05;18
Speaker 2
So I’m really what we do is we provide a software platform for third party administrators as well as health plans to provide flex spending accounts as part of the benefit packages that they offer to employers. So as kind of us as employees, we get the benefit of that by getting the ability to kind of get an HSA, get an FSA, get a commuter commuter account, maybe a wellness or or lifestyle spending account that really kind of enhances our enhances our experience as an employee, but also drives really frankly, long term kind of wealth and health for us.

00;02;05;19 – 00;02;32;14
Speaker 2
So as you think about that, HSA, how do you go and make sure you’re not just thinking about kind of near term getting to the doctor and that sort of thing, but also, you know, kind of long term saving for retirement or not and all that. So, you know, really exciting space. The health care kind of industry and really being kind of at the the the the the convergence of health care and fintech is really, really, really exciting.

00;02;32;15 – 00;02;36;19
Speaker 2
So, again, thank you for for having me and looking forward to conversation.

00;02;37;12 – 00;02;52;03
Speaker 1
Wonderful. And it’s funny, I was about to ask you what industry do you do so to because you’re kind of straddling a few different worlds health care, financial services. Obviously there’s a lot of a huge tech component to what you’re doing. So how do you think about the industry that you all are playing in?

00;02;53;05 – 00;03;07;20
Speaker 2
Yeah, so, you know, so like I said, fintech, absolutely. Health, tech and then also kind of the benefits space. I think really, really core to what we do is the benefits space. And then there’s, you know, there’s the fintech and health tech component that that plug in there.

00;03;08;15 – 00;03;15;26
Speaker 1
Wonderful. Okay. And your role, VP growth strategy and operations, what does that mean? Tell us a little bit about us.

00;03;16;20 – 00;03;55;12
Speaker 2
Yeah. And so, you know I this this title is kind of an interesting title. It’s not necessarily one that is like an every every company thing, but very much, very much. It’s a rev ops role, right? And so I call it growth strategy and operations, mostly because I report to our chief growth officer as she’s not responsible for just revenue, but also thinking about, you know, thinking about kind of the overarching growth of the company across multiple different different kind of lenses, especially thinking about marketing as well as as well as as well as so rev ops as a whole is really sort of my remit.

00;03;55;21 – 00;03;57;09
Speaker 2
I’m seeing kind of contextualize it that way.

00;03;57;23 – 00;04;24;04
Speaker 1
Got it. Wonderful. So now let’s get into the meat of our programing for today and, and talk about everybody’s favorite topic, which is manual forecasting. Fortunately, not something that you all have to do anymore. But talk to us a little bit about kind of the risks of this manual forecasting process that so many companies are beholden to this or we think of as this three headed hydra of spreadsheets plus CRM, plus RBI.

00;04;24;20 – 00;04;29;08
Speaker 1
What are the risks of running your forecasting in that kind of old school methodology?

00;04;30;19 – 00;04;47;13
Speaker 2
Absolutely. So, you know, I think really to talk about the risks of an old school methodology, you have to kind of start with what are the goals of forecasting, Right? So as I think about the goals of forecasting, one is, you know, first and foremost, and this is the obvious one, we need to drive predictability into the business.

00;04;48;05 – 00;05;07;09
Speaker 2
This is why forecasting exists or why it kind of existed from way back when. And then, you know, the other kind of two too big things that I think about our one, how do you drive accountability within a sales organization, ensure that, you know, if they say they’re going to hit a number, they’re going to hit a number, right.

00;05;07;25 – 00;05;39;18
Speaker 2
You know, what does it actually mean? But then also productivity. And this is kind of the I would maybe the dark of of the bunch in terms of their goals is that, you know, I think actually forecasting can be a lever for driving sales productivity if done in the right way. The reason I say that is, you know, if you think about a forecasting process and if you think about an old forecasting process, it’s a generally a cumbersome monthly, you know, week, week long of calls that pull reps out of the field.

00;05;40;14 – 00;05;59;07
Speaker 2
But then also where you don’t get all the information that you need and then reps are still answering questions over and over and over and over and over again to be able to kind of provide the level of visibility the rest the organization wants. So if I think about the three goals of forecasting, it’s, you know, that predictability, accountability, but also productivity.

00;06;00;13 – 00;06;29;27
Speaker 2
So as we kind of take that lens and then think about, you know, some of the risks of, you know, forecasting, whether it’s with like spreadsheets or CRM or a BI tool, etc., I think, you know, kind of a problem and a challenge there really wise in that there’s think about it as and right and it’s never, oh we can just use a spreadsheet or, or we can just use the CRM or oh, we can just use a dashboard.

00;06;29;27 – 00;06;57;04
Speaker 2
Right. It’s okay. How do we go stitch this dashboard into this spreadsheet? You know, pull the pull the data out of the CRM to live here and link all these things together, right? What that does is, you know, that actually drives us to fail on all of those objectives. So if we think about, you know, what, you know, kind of back to those three objectives, what is that driving a it’s driving a complicated workflow, right?

00;06;57;04 – 00;07;20;28
Speaker 2
That pulls pulls our sales reps out of the field and reduces the time that they’re spending with our customers to it diminishes the accountability. I don’t know if you you’ve probably heard the phrase like, hey, that number looks wrong on that dashboard. How many times after you’ve heard that phrase, have you had a productive conversation about the forecast?

00;07;21;13 – 00;07;45;14
Speaker 2
Right. And so, you know, and then lastly, you know, kind of the predictability can be hit or miss, right? So, you know, how much how much insight, you know, has a salesperson given you and what percentage of kind of what’s in their brain or what’s in the Sierra or what’s an all of these different data sources? You know, have you actually captured?

00;07;46;03 – 00;08;15;08
Speaker 2
I think another kind of just anecdote around the predictability side. You know, you’re relying really heavily on a salesperson to predict a number, right? That requires a lot of math. And like jokingly, I will say, you know, salespeople are really good at math when they’re calculating their commission. So and once told me that salespeople can do calculus or calculator their commission, but no other time.

00;08;16;02 – 00;08;39;02
Speaker 2
Now, obviously that’s not true. And you know, Jenna, only people can do math, right? But you don’t want to have to rely on people to do this complex math, whether it’s a salesperson, ops person or even a finance person. Right. To be able to actually accurately call a number. So you lose on all three of those, you lose on all three of those sort of goals.

00;08;39;02 – 00;09;10;04
Speaker 1
I love the pillars that you just outlined. Patrick. The main goals of forecasting predictability, accountability, productivity, and that focus on productivity is so important because you’re right, I think this is the hidden pillar that most revenue teams and certainly leaders don’t think about, which is if you are requiring your sellers to sit in these hour long meetings and get interrogated over and over again and have to do all this manual forecasting work, you’re stealing time from them that should be spent being productive selling.

00;09;10;14 – 00;09;32;29
Speaker 1
And we see all the time we ask folks that are using spreadsheets or using CRM to do some sort of forecasting process, How much time do you think it takes? And their responses are somewhere in the 5 to 10 hours per rep per week ballpark. That’s a huge amount of time. You’re talking about up to a quarter of a reps time just playing around in a spreadsheet.

00;09;32;29 – 00;09;58;05
Speaker 1
That’s not how you want to deploy your troops. So that I’m really happy that you focused on that as a main risk of productivity and then a main challenge that teams face, which is how do we actually operationalize this in a way that is useful. So I think this provides a good segue way into the next question, which is, okay, if that’s the old school way of doing things, what do you think about is the newer school or a modern approach to forecasting?

00;09;58;05 – 00;10;24;19
Speaker 2
Yeah, absolutely. So I think, you know, we can talk about kind of like fast forward and I would say like I think five years ago I would have said ten years, right? But now I’m probably talking two years just because of kind of the developments in AI, etc.. But, you know, let’s talk about what the future state is, which is really this a AI driven type of forecast with this human loop.

00;10;24;28 – 00;10;47;16
Speaker 2
Right. And, you know, obviously there’s been a ton of news and everybody in LinkedIn’s posting about like chat and all that fun stuff these days. Right. Which is an awesome tool, but it’s an awesome tool because it has a human loop embedded in it, right? As you think about many of the kind of the other types of tools that have kind of come on the market recently.

00;10;49;01 – 00;11;28;22
Speaker 2
You have one of two types. Either one, you have this kind of generalized model that, you know, kind of takes a stab at something and there’s a human loop. And then two, you have a very precise sort of predictive kind of algorithm that doesn’t require human intervention. These are the types of things that are used in health care to analyze, you know, to analyze like MRI readings, for example, we’re probably not going to get to that type of algorithm for forecasting anytime soon because it requires a ton of investment and a ton of kind of refining to kind of get to that level.

00;11;29;16 – 00;11;47;15
Speaker 2
That said, we can very quickly get to the other model where we have this kind of human loop with a with an AI backbone to kind of drive, you know, forecasting drive that kind of the majority of the effort that goes into forecasting. As I think about kind of that state and then maybe dial it back a couple of years.

00;11;48;14 – 00;12;14;21
Speaker 2
You know, I think there’s there’s a few kind of key things that that are incumbent upon our forecasting. One, it’s more frequent. So historically we’d have this month across every month process that would take a week. Now we’re getting to, you know, weekly forecasts, right? Sometimes even daily forecasts that don’t require people sitting in any meetings to be able to, you know, kind of roll it up.

00;12;14;21 – 00;12;34;18
Speaker 2
Maybe you just flip a couple things in Salesforce and you can roll up a forecast, right? So, one, it’s more frequent. Two, it’s insanely easy to complete. So kind of tying into the other point, if you want a weekly forecast, it can’t take a week to complete, right? Because then you’re not going to be consuming 5% of your sales person site.

00;12;34;18 – 00;13;02;19
Speaker 2
You’re going to be consuming 100% of it. Right. So, you know, it has to be easy, complete. I think the other piece that’s really a new kind of new ish phenomenon over the course of the past couple of years is it incorporates everything that you know. And so historically there has been this I’m going to put a number in a CRM against an opportunity, and we’re going to argue about that number right very much.

00;13;02;19 – 00;13;44;06
Speaker 2
Now, we’re incorporating so many more data sources in so many more kind of elements to a help have a better conversation, but also be kind of provide an additional level of accuracy in a fuller picture. So a couple of things that I kind of call out here right around one, this product growth trends. All right. I mean, we’re many years into the cycle there and we’re really starting to see kind of how we’ve how we’re evolving tools as an industry to help tackle that challenge of these more almost consumption based motions where they require much lower touch from a salesperson.

00;13;44;18 – 00;14;06;20
Speaker 2
How do you create a full revenue forecast when you have, you know, a bunch of salespeople focusing on your big deals, right? And you incorporate that insight alongside, you know, this consumption based motion. The other piece of this, too, is it’s not just about talking about all the revenue that’s coming in, but it’s also talking about the quality of that revenue.

00;14;07;01 – 00;14;34;11
Speaker 2
So thinking about, you know, thinking about everything from like, you know, how do you go take Gong or take wingman and put all those insights into and pull those insights into your deal forecasting to help drive that predictive model, whether human age or not, to be able to, you know, to be able to kind of better, better articulate forecast and then I think the last kind of oh, sorry.

00;14;35;18 – 00;14;57;13
Speaker 1
Just the point that you’re making, Patrick, and I’m sorry to interrupt, but the point that you’re making that I really want everybody to take home is that a modern approach to forecasting requires a redefinition of forecasting. And you’re hitting the nail on the head. You know, ten years ago, it was a bottoms up exercise where I was manually, you know, inputted by a rep and then rolled up to leaders.

00;14;57;13 – 00;15;21;21
Speaker 1
And that was the forecast. That is not acceptable in today’s world because of the sheer amount of data and signal that revenue teams have now that they didn’t have before. So, yes, the bottoms up forecast is still extremely important, but so too is the machine learning and AI driven understanding of your past and then the predictive analytics that the machine is calling for your future.

00;15;21;24 – 00;15;40;28
Speaker 1
And what revenue readers do is they’re able to take all these different data points and triangulate a forecast very different from a bottoms up roll up and more about a fuller understanding of all the different things that affect revenue and pulling that together into a single call. Is that a fair summary?

00;15;41;25 – 00;16;22;15
Speaker 2
Absolutely. Absolutely. And I think two other things. As we think about kind of that, it’s really the cultural element of this, as we think about kind of the tooling and bringing kind of everything that, you know, to bear. It’s also about, you know, driving kind of the transparency, accountability, but also empowerment along the management chain. So, yes, maybe some of the focus is kind of coming off of that bottoms up, roll up, but that just means that we can have better conversations against that, you know, roll up so that we can dive deeper into insight.

00;16;22;15 – 00;16;27;27
Speaker 2
We can dive, we can kind of get better aligned as one team around our deals.

00;16;30;27 – 00;16;54;05
Speaker 1
Makes a lot of sense. And so now as we think about kind of putting this into practice, Patrick, you’ve talked about this exercise used to be a monthly thing that took a week. Now it’s a weekly and sometimes even daily exercise to submit a forecast drug about efficiency. That’s huge. So how how have you operationalize this methodology? How are you forecasting both efficiently as well as accurately?

00;16;54;05 – 00;17;01;04
Speaker 1
Because it doesn’t matter how fast you do it, if it’s totally inaccurate. So how do you how do you do both those things? Efficiency and accuracy?

00;17;02;06 – 00;17;27;18
Speaker 2
Yeah. So I think there’s, you know, overarching theme, a measure it, right? If you’re not actually measuring the process or measuring the accuracy or measuring kind of the outcome, you aren’t going to be able to make progress on it. And then B is kind of actually, as you measure it and as you get some of these insights, make consistent progress.

00;17;27;18 – 00;17;50;16
Speaker 2
It doesn’t mean you have to go and rip out your entire forecasting process next month and, you know, try and incorporate every single possible data point that, you know. Right. All that means is if you’re doing something in a spreadsheet today and you’re, you know, and you’re building a, you know, kind of you’re manually building an analysis in Excel.

00;17;50;24 – 00;18;18;04
Speaker 2
And yes, it still does happen, maybe move it to a BI tool, right? Start that journey and start the evolution of, you know, kind of month over month. How can I make progress against driving a more efficient driving a, you know, kind of higher accountability forecasting process? I think a few kind of thoughts underneath that. One, it starts with culture.

00;18;18;26 – 00;18;49;14
Speaker 2
You have to drive a positive sales culture that, you know, we win together and we lose together. If you don’t start with that, everything else is meaningless because you start to get sales people doing things that they don’t want to be doing, right to hedge and to hide and, you know, all of those sorts of things. And, you know, kind of that just gets in the way of forecast accuracy.

00;18;49;14 – 00;19;22;27
Speaker 2
So one starts with sales culture. Two is, you know, stop enabling excuses with your process. And so I talked about that dashboard scenario earlier. The more complicated your process is, the more excuses you’ll have. So simplify, simplify, simplify, simplify across every step in the process so that you can drive kind of the accountability. And then I think, you know, so I mentioned kind of bringing in all the information.

00;19;23;04 – 00;19;50;03
Speaker 2
Absolutely do that. Think about all the data points that you can bring in that would be helpful, not just are there, but would be helpful to providing an accurate forecast and then lastly, you know, I would say stop trying to fit kind of a square peg into a round hole to some respect. And what I mean by that is your Salesforce report and your spreadsheet are probably not going to solve this problem for you there.

00;19;50;12 – 00;20;16;13
Speaker 2
There are better tools on the market today right. And it’s it it probably makes sense to start looking at how you kind of evolve this process, even if it’s just your BI tool as a step one, right? How do you move out of a spreadsheet and in kind of to a predictable, repeatable, very standard process that then you can document and you can measure and you can kind of improve upon that?

00;20;17;12 – 00;20;49;11
Speaker 1
It’s super interesting. And in this balance that you are striking from a process standpoint is really important. You’ve mentioned you want to have a simple process, but you want to have guardrails, You want to make sure that there is a standardized way that your sales team is prosecuting their deals. And it’s really important because if you have those clear entry and exit criteria, I assume it makes it a lot easier for you to spot risk in those deals for you to pressure, test the stage or forecast category that a deal is in.

00;20;49;18 – 00;21;02;03
Speaker 1
Look at your stage criteria and understand what’s on track and what’s off track, and then have a productive conversation about what needs to happen to move things forward. Is that a fair assessment? How do you go about spotting risk inside of these deals that.

00;21;02;22 – 00;21;29;07
Speaker 2
Absolutely so we talked about have a process and measure that process, right. From a forecasting perspective, it’s the same exact thing from a sales, you know, sales workflow and sales process perspective. So one, have a process to measure that process. As I think about deal risk, I think about it in three categories. You know, one, it is it going to close, two, is it going to close on time?

00;21;29;08 – 00;21;51;00
Speaker 2
Right. Or is it going to slip a quarter? Is it going to slip a year? Right. And then three, is it going to close at the stated amount? Right. As you think about kind of each of those three categories, I think one comes down to alignment, right? How do you create kind of a mutual action plan with your customer measure it with like MedPAC or Medicare?

00;21;51;00 – 00;22;26;02
Speaker 2
You know, one of those sorts of things to make sure you got the economic buyer right and you can flag those areas of risk as part of your deal so it becomes less you know, I think it’s going to happen. Right. And more. I have these four things in place, but these four things are outstanding. That indicates a 50% risk on this deal to, you know, think about, you know, as I mentioned, kind of the on time piece, you know, this is this is all about, you know, essentially the paper process of the deal.

00;22;26;17 – 00;23;01;23
Speaker 2
So if you don’t have pricing three days before a deal closes, I’m pretty sure that deal’s not going to happen, at least on time. Right. So map out those steps, measure them, understand how long they take, and that can provide you really good insight into whether it’s going to hold on time. And then lastly, you know, at the stated amount, I think is actually the easiest one of these to solve for you, which is all about kind of just the appropriate discovery upfront with your with your customer in the day.

00;23;01;29 – 00;23;21;13
Speaker 2
There’s no reason why they should be hiding from you what they want, right? If you’re having a discussion with them, if you’re not at the point where you can fully, concretely define what you’re trying to deliver to them, probably much earlier on in the sales cycle than like a stage six or a stage seven or something like that.

00;23;21;13 – 00;23;33;12
Speaker 2
Right? So make sure that if you don’t have confidence around that, you’re affecting the stage accurately. So those are kind of the three things that I would think about as I think about, you know, kind of deal risk.

00;23;33;27 – 00;23;54;26
Speaker 1
And a lot of those things that are really helpful. Overview. By the way, Patrick, a lot of those things are reliant on having the right leadership you mentioned starting with culture, ensuring that everybody is on the same page, but a lot of what you talked about can also be operationalized with technology. Software as in general, is meant to make people be able to do more with less.

00;23;55;03 – 00;24;15;00
Speaker 1
And revenue technology is no different. So how are how are you? You mentioned already this sort of digital transformation. To borrow a phrase from spreadsheets to CRM to buy to other sorts of systems. How do you think about technologies role in allowing you and your team to do more with less?

00;24;16;14 – 00;24;56;11
Speaker 2
Yeah, I mean, I think the first thing I would say is like nothing exists in a silo, right? So, you know, as you make technology improvements, there are, you know, tradeoffs, right, that you can make you time spent improvements, right, working with kind of antiquated processes. So, you know, as I think about, you know, the kind of concept of doing more with less, it’s very much the way that I’ve always approached it is in order to optimize my in order to optimize my kind of like people at cost, right, I need to make sure they’re working on the most valuable things.

00;24;56;19 – 00;25;18;01
Speaker 2
The way that I do that is I invest in technology to, you know, shrink the amount of time that they spend on certain processes. So as you think about that in a kind of sales motion or even in kind of my organization, you know, one of the things that I did over the course of the past year is I implemented a compensation system, right?

00;25;18;26 – 00;25;52;07
Speaker 2
And we did it manually before. Compensation is, by the way, a huge time consumption process for almost any company. Right. But I have someone who’s I have someone who’s managing forecasting commissions for me now that that commission systems in place, I’m going to you will take that person and I’m going to be able to up level them and they’re going to be able to spend so much more time working on board decks and working on and working on making sure that, you know, we’re thinking about kind of for go to market organization in a much more holistic sense.

00;25;52;23 – 00;26;12;09
Speaker 2
The same is true for the sales team, right? So as we take time off of, you know, top time off of their plate, so they used to have to spend on forecasting, then they can spend so much more time with their customers, ultimately driving revenue for us and increasing kind of sales productivity. So I think about it very much in kind of those couple of lovers.

00;26;12;21 – 00;26;36;09
Speaker 1
It’s a really smart way to think about it. And I know a lot of folks, they may get intimidated, Patrick, by a new technology that is replicating a part of their job and they may think, well, this this technology expenditure is just going to replace men, and that’s not the right way to think about it. The right way to think about it is exactly what you just said, which is this technology is going to do the more rote parts of your job that you don’t like doing.

00;26;36;09 – 00;26;55;00
Speaker 1
And frankly, I don’t want you spending time, but I want to exact that to the software, give that to the machine so that you can go and focus on the more thoughtful strategic work that’s going to make a bigger impact to the company and become a multiplier effect for you in your career, but also for us as a company in the way we think about what’s working and what isn’t.

00;26;55;00 – 00;26;59;06
Speaker 1
So I love that that journey that you’re on right now.

00;26;59;06 – 00;27;21;23
Speaker 2
Awesome. Yeah, No, I totally agree. I think, you know, we hear a lot in the news these days around, you know, kind of various events happening. And, you know, I think there’s a million things about that. Right. But that’s very much not what technology investment is about, Right. At least for me. Like it’s not about let’s go invest in technology so that we can cut.

00;27;22;04 – 00;27;30;05
Speaker 2
It’s what can we accomplish with that time that we’ve now saved, that is going to be accretive for the business?

00;27;30;20 – 00;27;34;27
Speaker 1
It’s exactly right. And I can’t believe it, but we’re already at time.

00;27;34;28 – 00;27;36;07
Speaker 2
Yeah, it was fast.

00;27;37;01 – 00;28;04;18
Speaker 1
It was super fast. Thank you so much for the wisdom and such a great perspective on how to think about traditional forecasting, how two companies can start edging their way toward a more modern way of forecasting. And and you’re proof positive that thinking differently and investing the time upfront for processes and systems of collaboration of your team and governance for your processes, how that investment upfront is going to pay dividends for yourself, for your company down the road.

00;28;04;18 – 00;28;12;01
Speaker 1
So thank you so much for the wisdom. Really, really appreciate it. Where can people go to find out more about yourself? Where can they go to find out more about allegiance?

00;28;13;00 – 00;28;35;22
Speaker 2
Sure. Absolutely. So, you know, my LinkedIn, I think my I think my thing is, Patrick O’Leary. So it’s really, really simple. And then a elitist, just suck up, have a ton of information there around around kind of what we offer and how we support, how we support some of our partners, but also, you know, kind of how you can kind of get in touch with some of our partners around around on their offering, which we power.

00;28;35;22 – 00;28;47;29
Speaker 2
So, yeah, thank you again, Kyle. I really appreciate, really appreciate kind of spending time with you today. It’s been a great conversation and looking forward to looking forward to continued forecasting progress.

00;28;49;02 – 00;28;51;22
Speaker 1
Thanks so much, Patrick.