This is the first in a series of four articles written for members of the executive team:
CFO’s are active partners in the development of the company strategy. From a sales perspective, they help design and manage the cost of sales, compensation, product pricing, channel planning, partnerships and forecasting. Like their CEO brethren, their background does not usually include formal sales experience. Unlike salespeople, they are process-driven, detail-oriented, and focused on data and analysis.
To succeed in our new economy, more companies have found it necessary to develop a more strategic sales organization. In addition to executing in a more strategic way, your company’s sales force must add strategic value. To illustrate this, consider how lean manufacturing, just-in-time inventory, Six Sigma, and other programs and initiatives have remade how business operates. Thriving now requires that the sales force create real capital.
CFO and other senior financial executives have a crucial role to play in this.
Understanding how salespeople think and what drives them is important. Consider this data from Objective Management Group (OMG):
- 60% of Salespeople Make Excuses
- 56% Are Not Extrinsically Motivated
- 45% Are Not Self-Starters
Most executives who I’ve met are surprised to hear that more than half of salespeople are no longer motivated my extrinsic factors (money, recognition, fame, etc.). If 45% of salespeople are not self-starters (determined by salespeople rating themselves), what does this say about the investment, ROI, productivity and strategy of having remotely-located sales reps? Compounding this is another finding from OMG:
- 86% of Sales Managers are ineffective at Sales Management
Here are a few articles worth reading about salespeople and sales leadership:
Why CRM Systems Don’t Ensure Consistent Sales Process
What are Your Salespeople Thinking When Management isn’t Looking?
How We Think Determines Sales Effectiveness
If you have limited or no field time with salespeople, I suggest that you invest some time to work with them on the ground.
Pricing, terms and contract negotiation are things that CFO's care deeply about. In many companies, Finance has direct approval over these. As a CFO or financial executive, how often have you agreed to something outside the norm and been frustrated with your salespeople’s ability to get the deal closed in the time frame agreed to? If this resonates, what are you doing to address the problem?
Forecasting accuracy strongly affects the financial health of an organization. This includes credit lines, cash flow, receivables, payment terms, investments and a myriad of other key financial processes. If the CFO received a weekly report showing which specific opportunities in the pipeline had slipped beyond the timeline allowed for it to be in that phase or stage, they could make better decisions. If this data identified by salesperson, what the conversion rates were when this happened, that would be even better.
CFO and financial executives need better visibility into sales not unlike what they look for from operations, manufacturing, client support and other company departments.
Here are some additional areas where CFO can and should be more proactive:
- Opportunity flow through the pipeline,
- Cost of sSales in terms of travel productivity,
- Education of the sales force on business principals,
- Checks and balances around resource allocation for proposal generation,
- Proper use of technical resources in the sales process,
- Time investment in sales recruiting, and
- Onboarding of new sales talent.
CFO’s, along with others in the Executive Suite, have the unique ability to create credibility when they speak. While some financial executives don’t have great presentation skills, what you say resonates amongst your peers. If your products and services' value proposition can be translated and conveyed in terms of business value (not just ROI), I suggest that you find ways to help with positioning your company at conferences, trade shows and other targeted events. Ironically, most companies don’t leverage their financial people from a lead generation and value proposition perspective, despite this credibility advantage.
Join us for Part Two of "Leading the Ideal Sales Force" on March 12. You can register here.