Chemicals

Years back, I had this big idea that I strongly believed in and felt could be a game-changer for my employer. I had everything down to be a digital transformation champion. The design. The prototype. The user experience. The hockey stick graph. The customer persona. The target market. The strategy. However, knowing my CFO from my experience, I felt nervous about pitching. I often heard “voices” in my head that CFOs don’t believe in big ideas. Their role is to shut them down.

Over the years, as I worked closely with financial executives, I’ve come to understand that pitching to them isn’t as challenging once you understand what they care for. Read on to learn how to tailor a pitch to your financial executives’ needs.

The Pitch

A good pitch consists of four essential components:

The purpose of the pitch.

This is perhaps the second most important component of the pitch. It must include the overarching benefit, which connects to either the bottom line or the top line. Let’s take an example of a hypothetical pitch.

“By replacing the legacy ERP, we would be able to ship your products within 24 hrs. I have analyzed competitive data. Through that, I learned that the competitors who can ship within 24 hrs have been growing their sales by 2x. Based on my market research, our customers prefer sooner delivery. Because they want the online experience to be closer to walking to a store, with near-real-time gratification of their spend, the ERP transformation project would help us increase our sales by 20%, boosting customer experience as well as employee satisfaction.”

As you can see, how this pitch tries to connect with the overarching benefits of increasing sales. As well as providing specific details on how that would be done. This is how a digital transformation champion needs to frame the pitch to get the attention of the CFOs.

What’s in it for them?

This is perhaps the most important component of any pitch. If a pitch is not aligned with the audience’s interest, it’s probably a non-starter. CFOs are responsible for managing the bottom line. That is, they are not only responsible for ensuring that the company can meet revenue objectives and collect cash but also responsible for containing costs. When sales teams fail to deliver on their commitments, they ensure that the bottom-line objectives are met. The best way to score with CFOs is to put yourself in their shoes. What would you like to hear in a pitch yourself if you were them?

What’s in it for you?

While you might feel that this part may not be as important, it is equally critical to show your commitment and credibility. If you have not outlined how this would personally impact a digital transformation champion, it’s hard to assess if you have analyzed it thoroughly, avoiding any biases with your proposal. This also helps in ascertaining the sustainability of the idea to ensure your commitment to it in the long term.

A good call to action.

Before attending the pitch meeting, take time to anticipate potential outcomes based on how the discussion might unfold and prepare a call to action for each scenario. For instance: 1) they might fully embrace the idea before you’ve even finished pitching, 2) they could dismiss it immediately, or 3) they might remain neutral and request additional information. Remember, a deal isn’t finalized until it’s truly sealed.

This is the mindset a digital transformation champion must adopt when navigating various scenarios. For instance, if the idea is completely rejected, you could ask probing questions to uncover whether there are any aspects of the idea that might simplify their work or address their needs.

In most cases, engaging them in conversation will provide valuable insights that can help you refine and align your pitch to their interests. However, the most critical part of the meeting is determining the next step. Once you’re out of their immediate focus, they may quickly forget what was discussed, potentially requiring you to start over. Having a clear call to action and a defined next step ensures you stay connected and remain on their radar.

When pitching, keep this in mind: the best pitches are the ones where you hardly have to pitch at all—your champions will advocate for you and handle the job.

The Champions

You might be wondering how, as a digital transformation champion, you can gather market data and field insights about what customers value and how competitors are performing in comparison to you.

To gain these insights, it’s essential to build strong relationships with the sales and marketing teams. While your expertise lies in technical skills, which they may lack, you can leverage these skills to analyze customer and market data through secondary research, such as reviewing internal data sources. In exchange for their field or market knowledge, this collaboration can be mutually beneficial. If you present this data effectively, it could prove valuable to them, creating a win-win situation. Additionally, if you gain the support of your sales team, they can become powerful advocates and pitch on your behalf.

Your champions can also offer valuable insights into what your CFO is likely to prioritize, as they may have more experience interacting with other executives. They can help you tailor your pitch to better align with the CFO’s interests. When selling to champions, your goal is to make the idea feel like it’s their own. If they’re not willing to take ownership of it, chances are you won’t be able to sell it to the CFO either. This can serve as a useful test to assess whether the idea is worthy of the CFO’s time. You may only get one opportunity, so when requesting a meeting, ensure that it’s truly worth their time.

The Financials

While ideas are important, CFOs are primarily driven by numbers. If you’re not experienced in calculating ROI or TCO, consider building relationships with interns in the finance department who have formal education in NPV and future cash flow analysis. They may be eager to showcase their analytical skills to the CFO. Bring them onto your pitch team and let them present the numbers. The more team members you have supporting your pitch, the better.

Your objective during the pitch meeting is not just to grab the CFO’s attention. If you’ve thoroughly analyzed how this idea benefits you in your role, their attention will naturally follow, assuming everything goes well. At this point, your main goal should be to gather as many people as possible in the room who are ready to pitch on your behalf. During the meeting, your role is to act as a moderator, guiding the flow of the discussion, determining who speaks when, and maintaining control of the situation.

The financials are only valuable if all assumptions are thoroughly vetted. Ensure you use reliable sources and have sufficient data to support your claims, as this is crucial for impressing a CFO. Evaluate all financial risks associated with the idea and prepare a backup plan for each one. If you overlook or ignore even a single financial risk, your entire plan could be questioned.

How do you excite CFOs?

Keep in mind that it is in a CFO’s best interest to consider projects that contribute to managing the company’s bottom line. If you’ve done a thorough job analyzing the numbers and gathered credible evidence to support your claims, CFOs will pursue your idea if there’s even the slightest chance it could provide financial benefit to the company.

CFOs have a deeper understanding of financials than anyone else in the company, so they focus on the financial feasibility of your next big idea, which is honed through experience. Just because one idea didn’t succeed doesn’t mean the next one won’t. The best advice we can offer is to never stop trying!

ERP is such a broad and deep subject that understanding how ERP systems work is really challenging. ERP stands for Enterprise Resource Planning. Historically, the whole idea was to plan the resources for an enterprise (or a company). And make them available for various users and business processes in a centralized manner. But which resources?

The resources could be human resources, machines, products, or assets. While some resources are common in most industries, such as human resources and assets, some industries, such as banking or service companies, may not have products or machines. On the other hand, other industries, such as manufacturing or distribution, may not sell services.

While the ERP term captures the true essence, it misses an “F.” “F” stands for finance. If we included an “F” in the term ERP, it would become “Enterprise Resource Financial Planning.” This is great as the foundation of any ERP is the finance module. In other words, if you are trying to find software that could automate your sales process but can’t replace your current accounting software, it means that you probably don’t need an ERP. You might just need LOB software such as a CRM (read what is a CRM?).

The term ERFP does a great job of capturing the fundamental assumption of capturing the finance/accounting piece, even though it is slightly misleading. Why? Because ERPs help with several other planning activities such as operations, sales, inventory, warehouse, etc. That’s probably the reason why they called it an ERP to begin with.

The Importance of Finance Module with ERP Systems

But why is the finance module always required in the case of an ERP? If the finance/accounting dept was completely siloed, as it is common with businesses that use software such as QuickBooks, Sage, or Xero. They would miss important financial insights to make key decisions, or they would be required to fetch and duplicate data and reports across departments. Some of the key decisions organizations typically make with the help of an ERP are:

• How much inventory do they need to ensure that their sales team is not missing opportunities without overstocking?
• Which items need to be purchased or produced in order to ensure that production is never halted?
• How much cash do they need in each month and quarter? This is to prevent cash flow shortages and ensure that the company can run its operations, even if customers don’t pay timely.

As you can imagine, these decisions can’t be made without financial data. Now that we agree that ERPs embed accounting and finance processes across the enterprise. Imagine how your salesperson would react if they needed to learn accounting as part of their job responsibilities. This is why ERPs are also very good at encapsulating accounting. This helps with connected operations with accounting performed in an automated fashion in the background. This also helps generate real-time financial statements and insights for critical transactional business decisions. While this could be a great convenience for business users, it might not be as comfortable for a finance person who relates to journal entries more than core operational transactions because of their background. This is where reality kicks in: there is always a bit of a learning curve for every user. A successful ERP implementation requires that users forget their old habits and learn new ways of doing things.

ERP Systems Automate Enterprise-wide Workflows

ERPs are also very good at automating enterprise-wide workflows, improving inter-departmental communication and collaboration, and enhancing customer experience. For example, when you get an inquiry for a quote from your customer, your sales team will look into inventory. They can check if the order can be fulfilled from a nearby warehouse. If not, they might book the order from this warehouse. Or, they might alert the other distribution center to ship the product directly from there or transfer it to this location in order to ship from here.

Your sales users–and, in some cases, customers–might be able to review inventory levels and shipping times, identifying the most cost-effective distribution center to fulfill the order. As a manufacturing business, you might want to know whether producing goods internally may be more cost-effective than sourcing from a vendor. Once goods are shipped, the finance team may be alerted to invoice the customer and ensure that the revenues are collected timely so that you don’t lose money because of delayed receivables. While these features sound promising, an ERP is far deeper with capabilities in what it can do to automate processes. And gain efficiencies.

ERPs are so versatile and customizable that there is not a single industry that can’t benefit from an ERP. Small companies and large enterprises all take advantage of an ERP. If you are not using an ERP today for your operations, most likely, you are using siloed and disparate systems. Or you have added additional staff to perform routine and mundane tasks. That could easily be automated using an ERP.

Conclusion

ERPs have evolved so much that it’s hard to keep track of the advancements. Modern ERPs provide a consistent experience across devices, whether a user is using an ERP on their phone or on a barcode reader. On a machine prompt or on a desktop. Traditional ERPs were archaic in their look and feel due to technical limitations, but modern ERPs have modernized their platforms. Sometimes, they could be as easy as using Facebook with real-time KPI widgets on each user’s homepage as well as notifications about the tasks they are expected to perform throughout the day on their phone. Plus, intuitive workflows without remembering thousands of commands or screens.

ERP implementations could be frightening, especially for small-sized businesses with limited implementation budgets and experience. While most ERP systems appear alike, they are distinctly different, designed to support specific business processes and transactions. They might also appear alike as each term could have multiple meanings depending upon the context, requiring careful evaluation of your requirements.

Additionally, it is important to build a target operating model and vet thoroughly and comprehensively with the process and data model of a target system. While ERP system evaluation checklists such as the one below could help to some degree, they require substantial experience in interpreting and contextualizing them. But here are some of the common questions relevant to ask your ERP vendors and resellers.

Publisher

While you might not pay as much attention to the questions related to publishers, as your focus is likely to be on the product and functionality. But with an ERP system, there are several factors related to publishers that drive whether you will be successful with the ERP implementation or not. So questions related to the publishers are critical for your ERP system evaluation checklist. Some questions that you should think of including are below:

• Who built the original product? Some popular ERP vendors include SAP, Oracle, Microsoft, and Infor.
• What is their customer base like? If they carry several products and if their flagship product may not target businesses comparable to your size, you might not get the same attention. The attention that you would get from a vendor whose primary customer base is similar-sized to yours.
• How large is the company that has developed the product? What is their market share in ERP products?
• What is the financial standing of the publisher? Are they profitable as of today?

Product

The questions related to the product are likely to be on your ERP system evaluation checklist. But you might not have all the macro-level questions, such as product install base, which is equally critical for your ERP selection. Some questions that you may want to include are below:

• Have they designed the product for your industry? Does it contain the last-mile functionality needed for your specific micro-industry?
• How many successful installations does the product have?
• How many times has it been installed for your specific industry?
• What is the customer base like? Are 80% of the customers similar-sized to yours? The product customer base is equally important as the publisher’s customer base.

Customization

• Would there be any add-ons involved? You may need to ask specific questions, such as who owns the code for each add-on. And review the contract.
• How much customization would be needed to support your unique processes?

Pricing

• How fluid and easy their pricing model is? Is it per-user, consumption-based, or concurrent?
• How much did the price increase in the last 5 years?
• Is the vendor able to lock down pricing for 3-5 years?
• Do they offer monthly payment options?

Roadmap

• Can the product support all of your business models and processes as of today but also in the next 5-7 years?

Data Ownership

• Who owns the data?
• Where is the data stored?
• Is the vendor friendly enough to let you export the data or provide access to it when you need it?

Mobility

• Can the product be used across devices? Mobile, tablet, desktop. If yes, is the experience consistent across devices?

Licensing

• Would there be a tier where your instance will be hosted? If so, do you need to upgrade to more expensive tiers if you grow out of the smaller tier?
• Would there be any storage limitations?

Ecosystem

• Is the talent ecosystem developed enough if you need to hire an internal expert or change the implementation partner later on?
• Are there enough companies developing add-ons if you need additional features that may not be provided by the publisher?
• Are there open-source communities and enough help available publicly for your users in the future?

Implementation Partner or System Integrator

• How do they price their services? Fixed Quote, Time and Material, or Recurring Service Subscription?
• How long have they been in business?
• How many customers do they have on this product?
• Are they allowing you to talk to the project lead who will implement the project?
• What has been their attrition rate in the last 5 years?
• Would there be a change in the project team or consultants once the project starts?
• Would the consultants be working onsite or remotely?
• Can they provide local support if needed?
• How much would they charge for post-implementation support? Do they have a packaged offering for unlimited support?