Short answer: Sales and marketing alignment is usually treated as a communication problem. In annual planning, it’s a math problem. When sales, marketing and customer success each build their own plan with their own conversion rates, coverage targets and renewal assumptions, finance ends up stitching three models together. The fix is one funnel model, worked backward from the bookings target, with shared definitions and a named owner for every number.
Here’s how annual planning often runs. Sales builds a capacity plan using 3x pipeline coverage. Marketing builds a demand plan from last year’s lead volume and conversion rates. Customer success builds a renewal forecast on its own. Finance adds them up.
Each plan is reasonable. Together they don’t connect. Marketing’s lead target doesn’t produce the pipeline sales needs. Sales’ coverage assumption doesn’t match its own win rate. The renewal forecast assumes a retention rate nobody has funded.
The gaps don’t show up until Q2.
Most alignment efforts focus on handoffs: lead definitions, service-level agreements, shared dashboards. Those matter. But if the plans were built on different assumptions, perfect handoffs won’t fix the gap. The teams will execute their separate plans well and still miss the number together.
Alignment has to start where the numbers are set.
One plan means one funnel model, built backward from the bookings target, that every function uses. Using the example from Which Number Is the Real Number?:
| Step | Value | Owner |
|---|---|---|
| New logo bookings needed | $28M | CRO |
| Average contract value | $70K, so 400 deals | CRO |
| Win rate | 22%, so about 1,820 qualified opportunities | CRO |
| Marketing-sourced share | 30%, so about 550 opportunities | CMO |
| Sales and partner-sourced share | 70%, so about 1,270 opportunities | CRO |
| Conversion from marketing lead to qualified opportunity | Last year’s actual rate | CMO |
| Timing | Q4 opportunities created between June and early September | CMO and CRO |
When marketing’s lead target comes from this model, it’s tied directly to bookings. When sales’ coverage target comes from its actual win rate, it reflects reality rather than habit.
Less than many plans assume. SBI’s general guideline is that marketing is attributable for 25% to 35% of bookings. If your plan asks marketing to source 60% of pipeline, either your business is unusual or the assumption needs to be tested against last year’s actuals.
The reverse is also a warning sign. If marketing sources far less than 25%, the business may be under-investing in demand generation, or sales may be doing prospecting work that marketing could support.
Three things have to be common to every plan:
Definitions. What counts as a qualified opportunity, a marketing-sourced deal, an expansion and a churned customer. If definitions differ, the numbers can’t be added up.
Conversion rates. Each stage from lead to opportunity to close, using last year’s actuals from the fact base, not last year’s plan.
Timing. Sales cycles mean pipeline has to exist months before the bookings it produces. Marketing’s calendar has to work backward from when sales needs opportunities, not forward from when campaigns are convenient to run.
Customer success owns two numbers the rest of the plan depends on: gross retention and expansion. If CS plans renewals separately, sales and marketing may be building pipeline to replace churn nobody planned to prevent.
Put retention and expansion targets in the same model. In the running example, the $10M of churn the plan expects would take about 143 new logo deals at $70K to replace. That belongs in the same conversation as the marketing budget.
Four steps, in order:
That last step is the one most companies skip. It’s also where most of the gaps get found.
Ask each functional leader for the three numbers their plan depends on most. Put them side by side. If marketing’s pipeline target, sales’ coverage assumption and CS’s retention rate don’t connect to the same bookings number, you have three plans. Fix that before the plan locks.
For the full approach, visit the SBI Annual Planning Hub.