Slippage

What is slippage?

Slippage is deals whose expected close date moves into a later period. It is measured as the count or value of deals that were expected this period and are now dated next period or later. Some slippage is normal, because buyers change priorities. Repeated slippage on the same deal is a warning sign about the deal itself. Tracked as a ratio over time, by seller and by manager, it is often called push rate.

Why it matters to a revenue leader

Slippage is where many forecast misses hide. A deal that slips once is a timing question. A deal that keeps slipping is a qualification question. IBM lists overly optimistic forecasting among the common forecasting problems, and slipped close dates are how that optimism shows up. Incentives can drive it too: Ian Larkin's research on enterprise software sales found deals moving between quarters in patterns that matched the salesperson's pay more than customer demand. Trended by person, push rate turns slippage from an excuse into a pattern a manager can coach. In services, budget cycles and facility approvals drive much of it.

How to calculate it

At the start of Q3, a testing and inspection company expects $1.6M from 20 deals. By quarter end, 6 deals worth $480,000 have moved to Q4. Slippage is 30% by value. Four of the six had already slipped once before.