Forecasting is one of the most beneficial aspects of commission software solutions, but it is also complex. It requires advanced tools, streamlined data integration, and a well-configured solution for nuanced sales predictions. 

To promptly achieve accurate and detailed forecasting, you may consider investing in more advanced tools than Xactly's built-in forecasting solutions. However, you must also understand how the benefits of these upgrades justify the costs.

At Canidium, our Xactly solution implementation experts work with the software's built-in forecasting tools, as well as the more feature-rich Commissions Earnings Forecasting (CEF) tool. They help clients determine which tool offers the best value for their needs based on their in-depth understanding of both options. 

Leveraging our team's expertise, this article will guide you through the CEF tool, helping you understand its uses and determine if it suits your implementation. We will cover the following topics:

• What is Xactly's CEF tool
• The four benefits of Xactly's CEF module

What is Xactly's CEF Tool?

Xactly's Commission Earnings Forecast (CEF) tool is a specialized module designed to enhance the capabilities of your CRM system by providing detailed forecasts and commission calculations. The CEF tool is particularly adept at extracting and analyzing data from Salesforce's pipeline management features, which track deals that are either pending or closed. What sets CEF apart is its ability to predict the commission values that sales representatives can expect based on these deals, providing a clear picture of potential earnings.

Although forecasting is integral to CEF, you can do so without necessarily using the complete CEF module. The forecasting aspect of CEF focuses on identifying pipeline statuses and understanding forecast numbers without delving into commission values. This functionality provides a straightforward view of expected sales outcomes, which can be crucial for planning and strategy without the complexity of commission configurations.

The CEF tool can be implemented as a standalone module or coupled with commission management systems within an organization. This flexibility makes it an essential tool for businesses that want to provide their sales teams with accurate forecasts and potential earnings, enabling them to make informed decisions about their sales strategies and efforts.

The 4 Benefits of Xactly's Commissions Earning Forecasting (CEF)

In volatile economic times, accurately predicting and managing earnings and commissions is more crucial than ever. Xactly's CEF tool offers a robust solution streamlining this process, providing clarity and strategic advantage to sales teams. 

This powerful tool optimizes how you use sales data, transforming it into actionable insights and empowering sales teams to meet their targets efficiently. With Xactly's CEF, you can harness the full potential of your sales data, making informed decisions that drive your business forward.

Here are the four benefits of Xactly's CEF module, which will help you fully understand why you should consider investing in it during your software implementation. 

1. Greater Visibility

The right forecasting tools provide unparalleled transparency, allowing you to see real-time updates and in-depth details of every deal in your pipeline. This enhanced visibility helps you monitor the progress of each deal from initial contact to closure, giving you a clear view of what's working and what isn't.

Xactly's CEF module gives you access to detailed analytics that can break down the sales process into manageable stages. This capability means you can track the probability of each deal closing based on its current stage and adjust your strategies accordingly. The visibility doesn't just end at the sales rep level. Managers, finance teams, and other stakeholders can access this data, fostering a collaborative approach to managing sales forecasts and achieving quotas.

Increased visibility ensures that no critical information slips through the cracks. By keeping everyone on the same page and enabling more strategic decisions based on comprehensive data, your organization can anticipate market changes more effectively and align sales strategies to meet these evolving demands, ensuring sustained growth and profitability.

2. Enhanced Strategic Planning

Understanding how close sales reps are to achieving their goals is beneficial and essential for effective strategic planning. The ability to forecast and plan based on accurate data from your sales pipeline transforms how you approach sales targets and quota achievements. This capability is critical, especially regarding quota and territory planning.

Xactly's CEF allows you to see which deals or prospects were entered into your CRM by a sales rep and identify which stage each deal is in—whether at the initial stages or advancing toward closing. Realistically, depending on your industry, many of these deals won't close.  Sales stall at different stages for various reasons, creating a gap between potential and actual sales performance.

This gap is where strategic planning comes into play, armed with robust metrics and forecasting tools that analyze your data. The CEF can provide a detailed breakdown of each deal's closing likelihood. For example, suppose you have an agreement in stage three. In that case, the forecasting tool can assess the information and predict whether it is likely to close. This insight is invaluable to your sales reps, managers, and the company.

Using this data-driven approach gives you a more accurate understanding of where you stand against your sales quotas. This clarity can be a game-changer. For instance, if you find that the majority of your deals in Salesforce are unlikely to close, it signals that you need to adjust your strategies. You may need to engage more prospects or rethink your approach to moving deals through the pipeline.

This strategic planning tool allows you and your managers to make informed decisions on allocating resources effectively, target areas that need more in-house management, and ultimately ensure that your sales efforts are aligned with your overall business objectives. 

It's not just about hitting your numbers for the year; it's about understanding the dynamics of your sales environment and continuously adapting to maximize your success.

3. Tailored Forecasting

Short of a crystal ball, forecasting is the closest any business can come to looking into its future. The capability to predict metrics in advance is vital for sales optimization, which is why more and more companies are seeking out advanced forecasting tools. 

Typically, Xactly's forecasting tool pulls in data from your CRM—information like the status of deals and whether they are closed or still in progress. This information helps you keep track of deals at various stages, enhancing your pipeline management. However, adding a specialized forecasting module, such as Xactly's CEF module, takes this a step further. CEF analyzes this data to predict potential commission values for sales reps, giving you a clearer picture of expected earnings tied to specific deals.

But what if you want a straightforward forecast without the complexity of commission calculations? In this case, the forecasting module allows you to bypass these details. It focuses solely on the CRM data, providing forecasts on how many deals are likely to close and the anticipated revenue from these deals. 

The CEF tool is also highly configurable. Whether you're managing new business acquisitions, recurring revenue, or a mix of different revenue streams, the tool can be adapted to suit each unique requirement. You can set up separate forecasts for various business units, allowing for granular analysis that can pinpoint where you're likely to hit your targets and where adjustments may be needed.

With such capabilities, you can meet your current sales goals and strategically plan for future growth. This ensures that your forecasting isn't just a numbers game but a strategic tool integral to your business success.

4. Reduced Workload

Handling projects manually is overwhelming when you collaborate across multiple teams. Accounting teams or managers often pull all necessary information into an Excel document. They manually sift through stages, assessing which deals might close, and frequently update these documents with new data. This labor-intensive process, typical in many organizations, involves a lot of follow-ups with representatives and continuous note-taking in Excel spreadsheets.

Xactly's automated commissions earnings system can do all this tedious, repetitive, and time-consuming work. Once the metrics are set up, the CEF tool automates data feeds, eliminating much of the manual labor involved in updating and maintaining records. This delegation of manual tasks eases the workload of the reps, managers, finance teams, and sales operations. 

Instead of isolated managers pulling data into personal spreadsheets—often resulting in a cumbersome process of emailing files for collaboration—everyone authorized can access the same data directly. This capability allows for a more collaborative environment. You could, for example, quickly view a team member's forecast and evaluate performance in real time.

Adopting such tools shifts your role from manual data handler to strategic overseer, where you can focus more on decision-making and less on data entry.

Leaning Into the Benefits of CEF

Xactly's CEF tool is a transformative asset for modern sales teams. It offers a comprehensive suite of benefits designed to enhance efficiency, accuracy, and strategic decision-making. By automating and refining the processes of sales data management, forecasting, and commission calculations, the CEF tool significantly reduces sales teams' workload, enabling them to focus on more value-driven activities. 

Tailored forecasting capabilities allow for customized insights that cater to specific business needs, ensuring that strategies are flexible and targeted. The tool also improves strategic planning by utilizing detailed analytics to forecast sales outcomes and track progress toward goals. Increased visibility across all levels of the organization promotes a cohesive and informed approach to managing sales efforts, making Xactly's CEF an indispensable tool for achieving streamlined operations and sustained sales success. Through these functionalities, Xactly's CEF simplifies complex tasks and empowers sales teams to drive growth and efficiency in an increasingly competitive marketplace.

Now that you understand how CEF adds to Xactly's potential value, your next step is to learn how to fully leverage the rest of the solution's features. Read on to learn more about best practices for developing comprehensive compensation plans.