Though a vast majority (95%) of finance and revenue operations teams express confidence in their ability to plan from existing sales forecasts, an overwhelming 98% say they struggle to formulate a forecast. To build a team’s confidence in both processes, the most important thing for organizations to pinpoint is what they are trying to achieve in their forecasting versus planning.

While sales forecasting essentially produces predictions on what is likely to occur in a reasonably short period driven by historical data, planning is all about effectively figuring out what to change based on what the forecast predicts. Leaders can then move forward with changes, like either shifting around priorities or focusing on pushing different products.

When a plan isn’t producing the desired outcome, what are the next steps?

As businesses and technology continue to evolve at an accelerated pace this year, plans can become obsolete quickly and fail to deliver desired outcomes. To stay competitive, companies must design flexible plans, as rigid adherence to outdated strategies can be counterproductive.

In any sales plan, leaders must differentiate between the foundational elements of the plan—such as target market segments—, and those elements that can be tweaked without causing significant disruption, such as decreasing the number of sales reps allotted to a certain market. What differentiates successful organizations is their ability to remain agile. Continuous miniature course corrections throughout the planning period enable teams to stay on track and achieve their goals more efficiently.

However, if a change to those foundational elements becomes necessary, leaders must allow for a certain time horizon to elapse before making another foundational change–otherwise, forcing the team to operate in chaos. The market’s reaction to the organization’s strategy can indicate if one of these foundational changes is necessary.

Planning is most effective for large companies when systemized through tools that help efficiently manage models and track these changes. These technologies can help businesses to maintain organization and structure while remaining agile and adaptable to evolving needs.

Agile planning leads to more accurate forecasts

Forecasting helps organizations build a roadmap and identify necessary adjustments, but planning is the key to refining and enhancing future forecasts. Planning forces teams to think strategically about potential outcomes, which directly impact the next forecasting cycle. In an intelligent revenue cycle, there is a continuous feedback loop: forecasting predicts, the team  makes necessary changes, reviews results, and then integrates those insights into the next round of accurate forecasting utilizing the results from past experiences.

The support of AI within the intelligent revenue cycle

According to a recent Salesforce report, 81% of sales teams are either experimenting with or have fully implemented AI and 83% of sales teams with AI saw revenue growth this year, while only 66% did without the use of AI. Within this cycle however, companies need to balance their instincts with what the data is explicitly telling them. Although AI can predict risks and agentic AI can institute changes, the components of human reason and intuition are still key to the process. AI will continue to evolve and become more accurate, but sales leaders must also rely on their data interpretation or brainstorm creative ways to reach goals.

While forecasting and planning serve distinct yet interconnected roles, their synergy is essential for driving business success. Organizations must cultivate agility, leveraging both historical data and strategic adjustments to refine their sales plans. With the balance of AI and human intuition, businesses can enhance forecasting accuracy and optimize decision-making. By embracing a flexible, data-driven approach, companies can navigate market uncertainties with confidence, ensuring sustained growth long-term.