Years back, I had this big idea that I strongly believed in and felt that it 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 these voices in my head that CFOs don’t believe in big ideas. Their role is to shut them down.
Over the years, as I participated in thousands of meetings with a variety of financial executives, I’ve come to understand that they are one of the best people to pitch to. Why? Because they can’t afford to be biased in their role. We just need to know what they care for. I am pretty sure you have felt the same. As a digital transformation champion, you may have been thinking of replacing that 20-year-old legacy ERP with a modern cloud-based ERP system. But not sure if you feel confident enough to talk to your management. Read on to learn the things CFOs or executives look for when you pitch to them.
The 2023 Digital Transformation Report
This digital transformation report summarizes our annual research on ERP and digital transformation trends and forecasts for the year 2023.
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. Yet essential. 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. And learned that the competitors who can ship within 24 hrs have been growing their sales by 2x. Based on my market research, our customers seem to 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%. And 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, not only that they are responsible for ensuring that the company can meet revenue objectives and collect cash. They are 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. And find out what you would 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, this 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 to ensure that you are not biased 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 going to the pitch meeting, try to evaluate all possibilities of how the meeting might go. And have a call to action ready for each of those scenarios. For example, 1) buys into the idea without even completely pitching it. 2) Shuts it down right off the bat. 3) feels neutral and asks you to gather more information. They say that a deal is never done until it is done.
This is the mindset a digital transformation champion needs to have with all these scenarios. For example, say he/she completely shuts it down, in this scenario, you might want to ask probing questions if there are any elements of this idea that could make their life easier.
In most cases, you will get them talking and they will offer insight that will help you align and tailor the pitch to their interest. However, the most important part of the meeting is the next step. The moment you are out of their attention zone, they might not remember anything that you discussed and you might need to start over. Always having a good call to action and a next step help connect the dots and stay on their radar.
While pitching, remember one thing the best pitches are those where you don’t have to pitch at all. This is where your champions will do your job.
The Champions
Now you must be wondering how as a digital transformation champion where you would get the market data and field insight about what customers care for and how competitors might be doing against you.
To get this insight, you need to make good friends in the sales and marketing departments. Remember, your strength is your technical skills which your sales and marketing counterparts may not be as good at. If you can crunch this data about customers and the market through secondary research a.k.a. “analysis of internal data sources” in exchange for the field or market knowledge, they would most likely be benefited from this data and it will be a win-win for both of you. If you manage to sell it to your sales team members, they could be highly influential and then they will pitch for you.
Your champions could also provide deeper intel into what your CFO might want to hear as they might have more experience dealing with other executives and help you frame your pitch aligned to their interests. By selling to champions, your goal is to make the idea of their own. If they are not willing to own it, likely, you might not be able to sell to the CFO either so this could also be a good test if the idea may be worth your CFOs’ time. You might get only one chance before they start questioning your judgment and credibility so when you ask for a meeting, make sure it’s worth their time.
The Financials
While ideas are great, what excites CFOs is the numbers. If you don’t have experience crunching numbers for the ROI or TCO analysis, make friends with interns in the finance department with formal education in NPV and future cash flow analysis who may have wanted to get in front of the CFOs to show off their analytical skills. Recruit them in your pitch team. Let them sell for you. The more team members you have who are willing to sell for you, the merrier.
Your goal during your pitch meeting is not to get CFO’s attention. If you have done a good analysis of how this idea would personally benefit you, in your role, you would get their attention automatically, obviously if all goes well. At this stage, your goal should be to get as many people in a room who are willing to pitch for you. During the meeting, your role is to be a moderator by facilitating who should speak when and having complete control of the situation.
The financials are only good if all assumptions are fully vetted. Make sure you use credible sources and have enough data to back up your claims otherwise it’s hard to impress a CFO. Assess all the financial risks with the idea and have a backup plan for each of them. If you missed or ignored even one financial risk, your whole plan may be called into question.
Remember, it is in the best interest of a CFO to consider a project that helps them manage the bottom line of your company so if you have done a good job of crunching your numbers and gathered enough credible evidence to support your claims, CFOs will come after you if there is even a remote possibility of any financial benefit to the company.
CFOs understand financials better than anyone else in the company so they are going to look for the financial feasibility of your next big idea. To get better at assessing the financial feasibility or pitching an idea, you just need to do it more and more. Just because one idea didn’t work out, it doesn’t mean that the next one won’t. The best piece of advice we can have for you is to, never stop pitching!
