Forecasting/projecting is one of the hardest things to do well. In other areas of the business where you have more control over the outcome, forecasting is easier and more accurate. In sales it’s more stressful due to the uncertainty. Projecting things under uncertainty in particular has its risks, but it’s a super useful tool in many areas, including sales.

Let’s say you’re a farmer. You make predictions and projections on your crop volume, even if that depends a lot on infirm elements like rainfall. You take historical data and project patterns for the future. Is it possible you’ll be off? Of course. Maybe you’ll get haze that’ll destroy your crop. Is it possible that being off will be disastrous? Hell yeah. Your family might have 10% of its income for the season. It’s necessary though.

Even though forecast accuracy is practically predicting the future, good Sales VPs are still expected to hit 90–95% forecast accuracy. Good forecasting is a skill which is learned and practiced over time, both by the VP as well as the Account Execs. Why is it important? It allows you to plan capacity better, make smarter/faster hiring decisions, decide where you should be investing more (tools, processes), make mid-quarter decisions that can move the needle fast etc. It also helps the interaction with the Product team, since you might need help from Product if you have high confidence a sale will close.