7 Tips to Maximize Revenue with Sales Capacity Planning


Embrace the unknown, break decision-making silos, and invest in technology to take Sales Capacity Planning from snooze-fest to maximum revenue.

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Priyaanka Arora
April 29, 2022

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7 Tips to Maximize Revenue with Sales Capacity Planning


Sales capacity planning can be hard. After all, you’re translating human behavior into goals that ultimately measure your team’s success!

Capacity planning can be rewarding when things go as planned, but not so much when you miss your targets or your team burns out. As a sales leader, you face the enormous responsibility of finding the right balance between a productive, motivated team, and maximizing revenue generation.

Avoid compromising on your goals by identifying the most common challenges facing sales teams and building a plan to address those challenges.

Read on for seven simple yet life-changing tips that ease the process of sales capacity planning and help achieve your team’s revenue goals.

Embrace your intuition and conquer the unknown

Capacity planning can be a bit of a black box.

Despite being a numbers game, it’s very subjective with just as many conclusions drawn from conversations as those from scientific methods and planning tools.

For example: consider top-down quota planning. You convert your allotted quota into attainable blocks based on historical performance, current productivity levels, and hiring plans in the near future. But at a granular level, you’re allocating quota based on your intuitive feel for your team’s capacity and past experiences.

And that’s not bad at all: in fact, studies show that intuitive decision makers in high-risk occupations like financial trading outperform their less intuitive peers.

You somewhat limit yourself when you strictly measure human output with formulas and ratios. Consider using your intuition as a supplementary tool to help prioritize decisions made behalf of your team.

This much is certain: data is currency in today’s world. But your intuition, derived from successful (and failed) experiments, serves as a way to sort through that currency to derive maximum value.

The only caveat: know where to draw the line on intuition in favor of a more grounded, tool-based approach.

With highly iterative processes like capacity planning, you win when you strike a balance between intuitive and analytical decision making.

Ask yourself: what if?

By virtue of being a front-line leader, you’re highly familiar with the intricacies of your business. But fast-growing businesses change rapidly. How do you make decisions that benefit not only the current state, but also the future of your team?

You’ll have to make some tough calls as a leader, but regardless, you never want to look back on a decision with regret.

Here’s a tip: prepare for all eventualities by iterating on all the “what-if” scenarios

Proactively address potential bottlenecks, preferably with a scenario analysis tool. Take this very simple example:

You’ve implemented a system that flags down quotas that are unlikely to be met by your reps, based on the past two years of performance data. But you also know that one of your reps recently attended a skill development workshop that will likely boost their productivity.

Instead of implementing tedious revisions to quota which may end up leading to further revisions down the line, map out all possible outcomes. Your rep could exceed targets or merely meet them. Alternatively, the workshop may have forced your rep to slow down and rethink their strategy, leading to underachieved targets that eventually grow into stellar performance.

By asking yourself “what if” at the capacity planning stage, you prevent costly surprises by moving away from black-and-white thinking.

Beware of decisions made in vacuum

Everyone makes decisions, from your team, to your leadership, to your peers in Finance.

And you’re well aware that many of these decisions overlap in terms of impact. But what percentage of decision-making is done in isolation?

A quick stat from PwC tells us that 55% of companies work in silos where each department makes its own decisions based on separate sets of goals. That’s unfortunate because unaligned teams dilute the purpose of a company vision and reduce accountability for decisions made.

Returning to capacity planning: how will your team be impacted by having to meet goals derived from decisions made in vacuum?

Keep in mind that a collaborative planning process can reduce the amount of bad decisions taken in silos. And using a flexible business planning platform can add extra visibility into cross-functional decisions and the assumptions that drive them.

With finance teams stepping up to be business partners, a collaborative decision-making process is the way to go for successful businesses of the future. This way, you can understand the whys behind the decisions and source help from unlikely players who broaden the impact of decisions for the company as a whole.

Partner up with your data science team

Speaking of partners in unlikely places, you may want to build a warm working relationship with your data science team or data champion within your company.

Why? At the very least, they can help you source and cross-report on data from your CRM and ERP.

Of course, if you build out your capacity planning model through a planning platform, you already own access to every data integration you could dream of.

Your data team can also help you prioritize data sources. They can educate you on best practices, and teach you helpful forecasting tricks for when you’re in a tight spot.

Here’s something else to consider: your new data scientist friend is likely a great resource for customer and usage insights, including demographic, behavioral, and activation data. This type of information is gold especially during territory planning, where so much depends on the industry and customer presence across territories.

Your data team can also improve your headcount versus target accuracy, through propensity to buy/churn models.

A word of caution: don’t forget to properly manage the outputs you receive from the team. Data science teams often deal with raw data, and it’s up to you to optimally consume and visualize this data. Try designing a beautiful board to easily present your data to the end-user.

AE Capacity Planning Pigment dashboard for Sales teams
Share insights through beautiful Sales Capacity Planning dashboards

In summary, connections with your company’s data team can give you a head start on capacity planning through insights, data best practices, and statistical methodology expertise.

Unite teams with your vision

This might be stretching past the scope of capacity planning and leaking into the Finance team’s territory. But have you considered how other teams could benefit from your vision?

In all likelihood, you’re already driving much of the conversation. Your capacity plan sets the tone for Finance to set high level revenue targets, and everything downstream follows.

Here’s the opportunity to acknowledge and formally define the role you play in uniting teams with your vision.

Regularly leading conversations around the implications of your sales capacity model with department heads can benefit you twofold:

  • You drive other teams to align their vision and metrics with yours and support you in meeting your goals
  • You get an outside perspective that helps you refine your models and plan for contingencies

Not only do you inevitably exchange useful information, you also build your team’s reputation as key players in company alignment. And that leads to higher levels of trust in your position as a leader.

Acknowledge the impact of ramp-up and attrition

You already factor in ramp time and wanted/unwanted attrition into your sales capacity model. However, it’s much harder to quantify the true impact of both hiring and losing team players.

In addition to what it does to your quota attainment, turnover has an impact on your team’s morale. And it’s a fairly large problem, especially in B2B SaaS spaces:

The average sales tenure has reduced by 50% from 3 years to 1.5 years over the last ten years. In combination with a 3 month average ramp-up for newbie sales reps up to one-year ramp-ups for more experienced folks, your productivity window is small.

Top reasons for sales attrition include unclear promotion pathways, high-pressure culture causing burnout, and poor communication from management.

In conclusion, factor in the needs of the team you’re planning capacity for.

Foster a team culture that nurtures its players, rather than wringing them dry of their will to succeed. The consequences of top-line planning without sustainability will eventually impact the bottom-line in a negative way.

Make your life easier with the right tools

As a revenue leader, you have the responsibility of setting precedents for your team and company. And your tech stack speaks volumes about your professionalism and innovative thinking.

Sales capacity planning is a prime contender for functions that are better off automated. Imagine never having to create a new spreadsheet tab for each rep and running calculations across tabs and sheets again.

There are better ways to approach sales capacity planning for fast-growing companies. Inversely, an agile business planning platform could speed up your company’s growth by replacing chaos with efficiency.

Here are just a few of the benefits of using a business planning platform for sales capacity planning:

  • It’s much easier to consolidate your data sources into a single source of truth, including your HRIS, ATS, and CRM data
  • Multidimensional data is better visualized and calculated with a planning platform
  • Powerful forecasting ability with large sets of data that spreadsheets can’t and aren’t designed to handle
  • You control access and versions - no more unwanted overwriting and duplicate files
  • Collaboration becomes a way of life when it’s so simple to tag people in cell-level comments to streamline communication within your workspace
  • You’re able to quickly weigh your options by creating what-if scenarios to understand the tradeoffs and decide on the best path to move forward with
  • As you scale, your planning platform scales with you, bringing you stability in an otherwise frenzied environment 

The ability to adapt to changing circumstances sets a great leader apart from the rest. Sales planning requires sensitivity and resourcefulness to make a true impact on revenue growth in a sustainable way.

Interested in learning more about how Pigment can revolutionize your sales capacity planning? Check out our revenue team use cases.

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