Ugh, budgets. My colleague Chris Crawford recently wrote a blog about how media sales account executives can impact their budgets by bottom-up budgeting. Once you, as managers, have this information, you are tasked with coming up with numbers for your people that, hopefully, will be accepted by Corporate.
We understand this is a high stress time for you. With Excel spreadsheets covering your desk, red eyes from a glaring computer screen, and a few late evenings staring you in the face, you are the lynch pin for 2014, projecting who will get a raise all the way to how much cash will go to the bankers. Many of you have probably done this “a time or two,” but here are a couple of thoughts as you prepared to send the budgets upward and onward:
- Evaluate based on last year’s account performance coupled with AE performance. Hopefully you have CRM and sales analytics software, or have other tools to do this – something more than a file full of traffic reports. A growing AE will bring in new business that they can’t necessarily project a year in advance. At the same time, an experienced AE will grow top accounts year to year. Look at each AE’s potential separately.
- Assess who is sandbagging and who is over-confident. You know who they are. Chances are that someone on your media sales staff always projects “conservatively.” We call it sandbagging. Chances are that someone else on your staff always projects higher than they finish – they are going to get everything they go after (because they are fantastic!). Know your people and adjust accordingly.
- Consider rounding UP. You will probably have a number given to you from Corporate once you turn in what you think your team can do. That number comes from people who love numbers and will no doubt be to the nearest dollar, meaning it will be some odd amount that you will have to fix in your brain monthly. Don't do that to your sellers. Round those figures up to a number that will be easy to remember. This will give them clarity in what they are going after, and will give you a little padding in case someone stumbles along the way.
- Once your sellers have locked in their projections, you have your figures and you present them with their budgets, take a look at what accounts your sellers have on their lists that have no projected billing. If they see no future in that account, why are they sitting on it? Move the account to an AE who doesn't have baggage, sees potential in that account and will go after it. It is often hard to rip accounts from sellers’ tight grasps as they explain how that guy is gonna spend something someday. But you want your AEs to focus on where they have the best potential of sales, and moving the little-to-no-return accounts will help them in the long run.
- Close your eyes and pick a number. As Chris said in his blog, it is a real stretch to predict what will happen a year from now. Use your CRM system to get the metrics to analyze, use your AEs’ intelligence on their accounts, and throw in some guesswork and luck. Even the most experienced budgeter is guessing – just make it a highly educated guess.
This too shall pass. The angst that goes with budgeting will be a distant memory by, oh, around Valentine’s Day. Then, you will just have to MAKE that budget…
By Kitty Malone, Efficio Solutions Manager of Client Services