The Power of Forecasting for Your Integration Business

Posted on August 17, 2020 in Blog ,Business Process Improvement ,Improve Financial Management ,Q360 ,Solutions360 by

Welcome back to our series of discussions about metrics and how to build the principles of maturity into your integration business.

Power of Forecasting for Your Integration BusinessWe’ve talked in a number of these sessions about mature companies versus younger companies or immature companies. And what we talk about today, is how do we get those immature companies to emulate what the mature companies, the successful ones that we work with, are doing.

“When you look at a mature integration company, they really value the whole concept of the power of forecasting,” says Brad Dempsey, CEO at Solutions360. “When they’re putting together a sales forecast, it’s not necessarily just to keep track of where the salespeople are and what they’re up to. It’s a leading indicator to operations and to finance.”

For many integrators, project status is a typical metric. But this is only a point in time, it doesn’t really tell you what’s going to happen, or what has happened. Solutions360 believes in looking at the entire project life cycle, which includes your pipeline, your backlog, and your forecast.

Mature companies understand that the kind of information they’re gathering in the sales forecast flows into the types of labor, the types of material, and the types of work that they will be doing in the future. Forecasting allows integrators to think about things like looking for new labor, hiring new people, or adjusting the labor force or getting a different type of labor skill before they actually need it.

Why is backlog important and why should integrators use it?

Backlog is that guaranteed business that we must finish, and it is guaranteed revenue. Backlog is what we have sold – which is contracted, and we have some legal obligation with the client – minus what we have actually earned. Basically, we have in-house a reservoir of work ready to do, and we can use the backlog to do forecasting and management into the future.

Truly mature integration companies understand that forecasting and planning is not an exact science. But the power of forecasting is the ability it gives you to make adjustments on the fly, because you’ve always got your eye on the ball.

 

How can metrics help integrators understand project progress?

 

How does forecasting help manage the pipeline?

 

Listen to the podcast for all this and much more!

Navigator Podcast – The Power of Forecasting with Brad Dempsey

 

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Project-Based Financial Concepts for Integrators

 


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