Why Using a Capacity Planning Excel Template is a Costly Mistake

Robert McLaws
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If you’re currently using a capacity planning template in Excel to manage your deal flow and sales team, you’re not alone. In fact, in our research we found that 80 percent of organizations still do it.

Despite the popularity of the capacity planning Excel template, it is seriously flawed.

Capacity planning is both a science and an art. In its simplest terms, it involves figuring out how many people and what kinds of people are needed to deliver against your revenue goals, drilling down into how many deals each person will need to close each day (and how big the deals are).

Then, as activity actually takes place, you need to recalculate and then often re-recalculate where you’re going to end up at the end of each week, month, and year.

But, behind the spreadsheet, hundreds (if not thousands) of factors exist that will ultimately have an impact on sales results:

  • Onboarding and training take a significant amount of time before each rep is working at full capacity. (And that doesn’t even factor in the amount of time you may take to find the ideal candidates.)
  • Individuals’ work and life schedules can be highly variable
  • Seasonality can have an impact on deal flow

Excel is a Static and Outdated Tool for Capacity Planning

Capacity planning Excel templates are popular because they are relatively easy to use. Spreadsheets are commonplace and most of us know how to create and modify them. But…

  • Excel doesn’t naturally take into account the human aspects of the sales process.
  • Rounding up or down will ultimately result in huge financial errors.
  • And, of course, data input can be flawed. One wrong keyboard hit can result in egg on your face in your next Board meeting. When people are stressed, they are often prone to making mistakes, which may go undetected until you miss a forecast by a wide margin. We estimate that 87 percent of spreadsheets contain at least one error.
  • Excel spreadsheets can’t be easily shared and you wind up with multiple versions floating around. Using collaborative tools will not only allow you to consider different perspectives (i.e., Sales, Marketing, and Finance), but it can also help build more teamwork within your organization.
  • Excel templates can take an incredible amount of time to customize. Updating data can take hours of time; hours that would be better spent actually speaking to prospects, training the team, or thinking of the next big idea.
  • Capacity planning templates are usually static and, rather than presenting data in a dynamic and engaging way, simply look like a mind-numbing snapshot of digits.
  • These templates are often developed as a one-size-fits-all solution, rather than a client-centric tool for fast-scaling or start-up SaaS businesses.

So, Now That We’ve Given You 7 Reasons NOT to Use a Capacity Planning Excel Template…

What’s the alternative? Imagine a system that:

  • Is cloud-based, so that your entire team can use it from wherever they are (a common situation these days).
  • Was designed specifically for start-up and scale-up companies who are adding on salespeople regularly and must account for hiring time, onboarding time, and training time. And, although we all wish all our salespeople were amazing and would stay at our companies forever, we sometimes hire poorly or lose key talent and those very human factors must be reflected in our forecasts.
  • Offers you a simpler and faster way to forecast. You can even create multiple scenarios in a matter of minutes without juggling multiple open tabs and spreadsheets.
  • Can even help guide you on when to hire your next sales rep. Understanding and documenting the capabilities of each of your current team members will also enable you to see -- very clearly -- when they are reaching capacity and when you might need to hire that next salesperson.

As founders ourselves, we became increasingly disgusted and disillusioned by the lack of systems designed specifically for start-up and scaling SaaS businesses, so we blew up the capacity planning Excel template and created a cloud-based solution that is smarter, less error-prone, more collaborative, and dare we say more human?

Excel is here to stay and it has many great uses. But, when you’ve developed a kick-ass new product or service, are setting ambitious business goals, and spending investors’ precious dollars on a sales organization, you want to be sure your sales capacity plan measures up. It needs to help you make those critical hiring and spending decisions that lead to success and profitability.

Plus, the less time your salespeople spend updating spreadsheets, the more time they can spend making sales.

That’s why you need BurnRate.io and not an Excel capacity planning template! 80 percent of users CAN be wrong!

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