What is a hockey-stick quarter?
A hockey-stick quarter is a quarter where most deals close in the final weeks, straining discounting, forecasting and the team. Plotted by week, bookings run flat and then shoot up, like the blade of a hockey stick. Some back-loading is natural, since buyers also work to quarter-end and year-end budgets.
Why it matters to a revenue leader
The pattern is often created on the seller's side. Paul Oyer's 1998 study in the Quarterly Journal of Economics linked nonlinear sales and executive pay to higher sales at fiscal year-end. Ian Larkin's research on enterprise software sales found deals timed to commission periods carried larger discounts. For a revenue leader, a hockey stick means the forecast stays uncertain until the last days, buyers learn to wait for the discount, and operations get a wave of work at once. In services, that wave lands on install crews and project managers.
Example
Fictitious numbersA fire protection company books $3.0M in a quarter, with $1.8M of it in the last three weeks. Discounts on those late deals average 9 points deeper than on deals signed earlier in the quarter. Install crews start the next quarter with a backlog spike and overtime.
"What share of last quarter's bookings came in the final three weeks, and what did those deals cost us in discount?"