Remember coming across a hot new GI Joe action figure at the toy store when you were young? You’d seen the commercials on your Saturday morning cartoons, and now that you’re seeing the toy in person, you just have to have it. You beg your mom and you explain to her that your life will be irrevocably changed if you only had that toy. She seems convinced by your point and is amenable to you buying that toy. Until she says three fateful words:
“Ask your dad.”
You know who is the penny-pinching, fiscally responsible and ultimate financial decision maker “father figure” at most companies?
Whether you’re selling sales enablement software, complicated IT investments or just some office stationery, even if you have the most excited “kid” buyer on the other end of the line ready to buy, it all won’t mean a thing unless you first get dad’s approval.
So how can you do that?
CFOs Care about Just One Thing:
The bottom line.
And who can blame them? After all, their job – in conjunction with the CEO – is to make sure the company stays profitable and doesn’t run out of cash. This means finding the right price points to ensure great profit margins and being responsible in terms of how the company spends money. When the business does need to spend – as all companies inevitably do at some point – it’s on the CFO to ensure that the spend is truly necessary, and not a frivolous expense. At that point, it all comes down to ROI.
When the CFO is presented with something that one of the teams wants to buy – be it BI and analytics software for the sales team, a lead deduplicator for the marketing team or a complicated enterprise-level IT investment – she will want to know what to expect in terms of a return on the investment. And for CFOs, that essentially means asking and answering one question:
What is the payback period on this investment?
In other words, when should they expect to see the initial cash outflow of an investment (i.e. how much the company will spend on installing this new piece of software) recovered from the cash inflows generated by the investment (i.e. the new software pays dividends and brings in more revenues, directly or indirectly)?
Another way to think about the payback period of a vendor purchase or IT investment is in terms of time-to-value. This is the time from the initial implementation of a new solution to the moment the business sees a measurable value from it. If a software investment is great, but takes 6 months to onboard and get full up and running, that time-to-value is significantly longer, as is its payback period.
For sales reps who have hooked the “kid” and convinced the “mom,” the next step in getting the “father” – the one with actual purchasing power – on board starts with these terms; payback period, time-to-value and ROI. When you can speak in that language and communicate – with data – the value and viability of the product you’re selling in that context, the CFO will be a lot more likely to open his wallet and sign off on the purchase.
It’s Not Just about Technology
Another way to be more successful at getting CFO’s to sign off on the purchase that you’re pitching is to put yourself in the shoes of the prospect you’ve been talking to. Even if this person has no direct purchasing power or the authority to make buying decisions, they are still critical to your sale – after all, they are your champion, ready to fight the battles that you can’t directly fight.
Convince the prospect that they need what you’re selling, and they will be more apt to in turn convince their CFO that they really do need that. It is important to frame the conversation in the context of not treating this purchase or investment as simply buying a piece of software or technology; rather, you want to dig into the process that your product affects, and find the holes in that process:
- Start by helping the prospect identify the outcomes they want to achieve. Is it to get more visibility into their sales pipeline? Are they trying to clean up their marketing operations by deduping leads? Does the company’s whole email security policy need rejiggering? Whatever it is, frame it as a problem or shortfall, and then your prospect will see it that way and communicate that to his CFO.
- Measure the current performance and benchmark it. You want to determine potential gaps in their current process, so that they can say, “We’re currently achieving X. We believe that by buying this software, we can achieve Y, at a much more efficient level.” That is a real business case that the CFO can appreciate.
- Bring in your product and demonstrate specifically how it can close the gap. It’s time to get specific about how and where your product can actually close the gap and make the aforementioned process more efficient and effective. Remember, the CFO thinks in terms of bottom-line dollars, so anything you can demonstrate to prove either a reduction in costs or an expansion in revenue will be language the CFO can understand.
Thinking about the end-to-end process – and all the various inefficiencies and applicable business cases – is much more powerful than just communicating about a piece of software or an IT investment.
Dads – and CFOs – often get bad raps for having to do the responsible thing, make tough decisions and say “No!” where other people will readily say yes. But it’s not impossible to get through to them – you just have to speak their language and frame arguments in a context that makes sense for them. Do that, and you’ll be able to convince any prospect that they need the fancy new GI Joe toys you’re selling.