No CFO will approve a major expansion of software without a
clear understanding of the value equation.
The challenge, often, is that the people who bought the 1 or 2 seats of
the original “Land” purchase generally don’t have the experience to uncover and
communicate the value. The vendor may be
required to help the buyer with the process since many of these buyers have
never orchestrated a large purchase.
Buyers who go to their CFO’s with incomplete information are
likely to be denied their request. I’ve
seen inexperienced managers present to their CFO’s with statements like, “We
need a new sales process system; the old Excel system doesn’t really work…”
CFO responds, “Well, you’ve been using the Excel system for
the past 5 years… This doesn’t really seem
compelling.” [Rejected!]
Here’s a simple checklist (for the buyer) to help them with
the purchasing process:
Critical Business Issue:
What over-arching objective or challenge are we [the customer
organization] seeking to address?
Problems / Reasons:
What is getting in the way? What
systems or workflows are insufficient, and in what way?
Specific Capabilities:
Here is the list of specific capabilities we are looking for in a
vendor’s offering.
Delta: This is the
tangible value we expect to gain as a result of making the change – expressed
in specific terms of time, people and/or money.
Critical Date: The
date by when we need to have a solution in place and driving force for that
date.
Quick example: A
Director of Sales Operations of a large software company purchased a few
licenses of a new sales process tool to try out, liked it, and now wants to
deploy it across the full sales organization. Here’s what his summary checklist
might look like:
Critical Business Issue:
Achieve 2015 sales revenue objectives; expand pipeline; reduce the
number of “No Decision” outcomes.
Problems / Reasons:
Current sales process tool is an Excel application; hard to use, takes
forever to roll-up; lots of errors and inaccuracies; actuals vs. forecast
numbers rarely match. Sales people hate
it and reports are difficult to generate and distribute; sales managers are
unable to accurately assess real opportunities vs. those that will likely end
as “No Decision”.
Specific Capabilities:
Simple, fast, web-based entry and tracking of sales opportunities and
process steps; clearly defined stages; simple checks on data and process
accuracy; reports of weekly, monthly and quarterly forecasts, with highlighting
of key projects and issues; rolling 3, 6, 9 and 12 month pipelines on per-rep
and per-region basis.
Delta: Reduce “No
Decision” category results by 50%; increase overall revenues by 15% and 6-month
pipeline by 25%. Recover and redeploy
1.5 FTE currently consumed with the Excel system.
Critical Date: February
13, 2015 for roll-out at 2015 sales kickoff event.
Now the case is much clearer: The CFO knows why a new system is needed –
what goals and objectives are at risk, what specifically what capabilities are
needed, and (importantly) what value is expected as a result of implementation,
as well as when (and why) implementation needs to take place. The Delta – the value component – is key. A CFO is much more likely to say “Yes” to
this…!
[For more specific tips on uncovering the Delta, see my blog
post on March 20, 2014 “Let’s Talk About Value – Uncovering the Delta”]
