Sales Team Strategies: Working With The CFO

I meet with a lot of talented people. It’s one of the perks of speaking and blogging in the marketing and career space.

I had the opportunity to meet with Armen Miamidian a few weeks ago who is a CFO in Orange County, CA looking for his next job. We had a great chat about being a CFO and about what it’s like to work with him as a CFO. So I decided to interview him and share his insights.

If you are in sales or marketing, read his answers to these questions for some insights on how to work more successfully with a CFO like him. And, if you have an upcoming interview with a CFO, I’ll bet this post will help you as well.

In your experience, what has been the attitude of sales teams toward finance?

That’s a loaded question. First, let me say that CFO’s understand that nothing happens until there’s a sale. So we love sales and have great respect for what sales teams do.

That said, oftentimes there’s a natural tension between sales and finance which is understandable. Sales teams are out working hard to bring in business and the last thing they want are internal speed bumps. On the other hand, finance is the guardian of the bottom line so we don’t want to leave anything on the table in our dealings with customers or allow the company to be exposed to excessive risk.

So what SHOULD the attitude be toward finance?

Take advantage of what finance can offer. Finance can be a tremendous resource that’s ignored too often by sales. Partner early with us so we can arm you with the information or tools you need to be more successful. We want nothing better than to see the sales

team succeed and be rewarded accordingly.

How can finance help the sales team be more successful?

Here are a few examples of how we can help:

  • Finance can provide analysis on which sales programs have historically been the most effective and profitable so you can be more focused.
  • Collaborate with finance to develop a dashboard or other reports to help you.
  • We can also provide useful tools such as pricing models to calculate the effect on customer profitability from price and/or volume changes.
  • We can help the sales team avoid spinning its wheels. Share your prospect list with finance so we can gather intelligence on their financial strength. It may prevent you from wasting time chasing prospects that are circling the drain and would not pass our credit standards. A sale is not complete until we get paid.
  • Use us as a resource (or the “bad guy”) when negotiating with customers.
  • Most importantly, we can help you with strategies for maximizing your sales incentive.

Sales teams often complain about how picky finance can be about details – why is that?

Guilty as charged! Attention to detail helps the company in general and the sales team in particular. Ambiguity or misunderstandings with the customer can cost the company and the sales team big time.

We can avoid that by using pre-approved contracts that spell everything out. When dealing with large organizations, they will often insist on using their own documents which may or may not include all the things that are important to us. Those should be brought back for review right away so any omissions or ambiguities can be dealt with immediately before things are set in motion.

We recognize that sales teams are good at finding creative solutions to close the sale and they want to be able to make decisions in the field.

Therefore, it’s important for sales leadership and finance to work together beforehand to establish guidelines. Use the CFO as a resource who may be able to help improve profitability or reduce risk. I’ll admit that I’ve learned this the hard way.

One chore most sales teams dislike is forecasting. What things should they keep in mind when preparing them?

I understand how difficult it can be sometimes to forecast, especially if there are new products/services or new customers in the mix, not to mention outside factors such as economic conditions or competition. A few simple guidelines:

  • Collaborate with marketing.
  • Discuss promotional plans and take into account the expected effect on demand.
  • Give us what you really, truly, honestly think you will do (don’t low-ball and don’t provide unattainable pie-in-the-sky numbers).
  • Remember: production, inventory and resource planning are based on forecasts. Too little, and there’s not enough for you to sell. Too much, and your valuable time will be wasted later trying to sell off excess inventory or capacity at low margin.

From the CFO’s perspective, how would you like to see the sales team approach their dealings with customers?

Think of the business development effort as bringing in profit, not sales. Focus on customer profitability. The value of the business is more important than the volume of business. The sales team, being on the front lines, is in a unique position to leverage the impact of sales on the bottom line.

To encourage that mindset, I’m a firm believer in having sales incentives based on the profitability of customer relationships rather than the top line. This way, the sales incentive is aligned with the company’s goal of maximizing profit. It’s the CFO’s job to educate the sales team to raise their financial literacy and to give them the tools to easily track progress and to help them see the bottom line effect when putting together deals.

I’ve found that that when sales teams are motivated to focus on the bottom line, sales and finance get along much better because we’re working toward the same goals.

Do you have any pet peeves in dealing with sales people?

Another loaded question. As a supporting argument for a special price or a special deal that’s out of normal guidelines, I often hear things like “this deal will build goodwill with the customer” (which means it probably won’t be profitable) or “think of it as an investment” (maybe some time in the distant future we can make some money) or my favorite “we’ll achieve synergies” (no way this will ever be profitable).

CFO’s tend not to buy into such fuzzy arguments. While I understand that some decisions are based on gut or emotion, I still want to hear a solid business case. A good value proposition for the customer is what builds loyalty. A sustainably profitable relationship is what builds our business.

Any closing thoughts?

I see the relationship between sales and the CFO as a lot like that of Luke Skywalker and Darth Vader. We have our occasional battles. But in the end, we’re family and we’re better when we help each other.

What’s your experience working with or interviewing with the CFO?

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