Selling to the CFO, the Brennan IT way
- 02 May, 2017 08:49
Simon Barlow - Executive General Manager, Brennan IT
“If you start talking about technology or finance straight away, you’re positioning yourself to fail.”
The words of LifeHealthcare Group CFO, Dean Taylor, in a direct address to channel partners across the country.
For Taylor, in running the books of one of Australia’s leading independent medical device distributors, sales conversations are changing, requiring a fresh approach from technology providers seeking to navigate the broader workings of the boardroom.
With technology buying decisions moving away from the traditional IT department, finance now plays a greater role in influencing technology purchases, promptings partners to change tact when selling services and solutions to end-users.
“It’s not a technology conversation, it’s the wrong one to have,” Taylor said. “It’s also not about narrowing it down to a financial discussion.
“It’s one that is strategically led in context to the business direction.”
From Taylor’s perspective, the shift is focused on transformational change, creating a need to look past the present day to articulate business benefits to buyers.
“You’re looking at your underlying business requirements going forward and what your business will look like in the next five to seven years,” he said.
“And if your existing systems today are capable of supporting not just the volume of growth but complexity growth as well.”
Stereotypically, selling to a CEO has been straightforward for the channel in the past, with resellers tapping into the high energy and positivity exerted from leaders of the business.
Tradition also dictates however that selling to the CFO is tough, with financial controllers viewed as habitual blockers in the buying process.
Yet behind every great CEO is a great CFO, with the financial leader capable of making selling technology a breeze or a nightmare.
Selling to finance
But while most CFOs can calculate gross margin and earnings per share in their head, they are seldom fastidious bean counters.
“They’ll take a bigger picture view and look at the business outcomes,” Brennan IT Executive General Manager, Simon Barlow, observed. “They’re not really into bells and whistles, that’s not what excites them. They’re not technical people.
“They just want to know that they’re making the right investment for their shareholders and that it will show a deliberate return in a certain period of time.”
In short, CFOs require stronger- than-ever business plans to justify new IT investment.
“They’re exceptionally receptive to an improved technology conversation and a digital transformation conversation,” Barlow said. “But there needs to be clear business outcomes.”
While all technology decisions invariably touch on the dollar sign at some point during the transaction, Barlow believes the reality of the local industry has changed, with IT and infrastructure now an enabler for a business rather than being just a supporter.
“The difference is that the workloads and applications that we’re supporting now take so many more parts of the business from an end-to- end perspective,” he explained.
“It’s meant that the decision making process for organisations has become more complex, which goes beyond both the CIO and CFO.”
In representing one of the country’s leading IT service providers — with over 1,000 customers nationwide — Barlow acknowledged that technology sales today continue to be challenged by a partner’s ability to capture the wider consensus of the C-Suite.
“Generally, there are stakeholders across every aspect of an organisation with usually around six or seven involved in the buying process, and the CFO is one of those stakeholders,” he added.
It’s a sentiment backed up by Taylor, who said C-level executive involvement varies from business to business.
For example, for partners dealing with an organisation that views IT as a cost to the business, deals would naturally flow through to the CFO.
However, those that consider IT as an enabler are more likely to channel deals from the CIO through to the CEO, creating new sales dynamics as a result.
As CFO and overseer of internal operations, Taylor holds responsibility for IT within LifeHealthcare, and is viewed as a key influencer in the entire buying process.
“But the approval process also requires buy-in from the executive team and the board for it to be successful,” he added.
“There’s never a sole decision maker. If there was, it would create a level of risk around the right decision being made. The actual go or no-go decision doesn’t come down to the CFO anymore, it’s more of a consensus decision.”
Changing the conversation
In light of the role of the CFO becoming stronger from a technology buying perspective, Taylor insisted conversations with solution providers must become stronger as a result.
“The role of the CFO has evolved to becoming more commercial rather than just compliance based,” Taylor explained. “Those two requirements are merging.”
With efficiency a key requirement for finance, Taylor said LifeHealthcare priorities focus on achieving operational efficiency, transactional efficiency and automation, resulting in the simplification of processes.
The end result for Taylor, is a conversation that is more commercially focused than before.
“IT tends to get lost within the technology,” he added. “It’s now less about the technology, but they need to learn how that technology can assist the business to operate more efficiently.
“Technology, unfortunately, is one of those things that you can’t see the direct benefit of — it tends to be more indirect.”
Through the eyes of the channel, Barlow explained the importance of partners understanding the internal buying methodology of any organisation they are selling IT services into.
“Do they prefer to purchase outright?” he asked. “Do they pay annually? Are they cash flow positive? Are they looking to change their business model?
“It depends on the state of the business you’re selling into as to whether they want their assets on sheet or off sheet, whether they want to go to an OPEX type of payment model, or whether they are cash positive and they want to continue those investments.”
In working across industries such as government, retail, healthcare, financial services, hospitality and manufacturing, Barlow said Brennan IT has responded to the changing face of the buyer through better enabling its sales team.
“We need to be able to talk on a financial level, in terms of having a balance sheet conversation,” he added. “We also need to articulate clearly the business outcomes rather than just a commodotised price.”
In addition, Barlow also addressed the need for the “one throat to choke” conversation, with CFOs still aware of brand reputation and a single point of contact for an end-to-end solution.
“They just need to know that they get the right escalation response when needed and they’ve got the right contract matrix for one throat to choke,” he added.
“Our jobs are much more complex these days because it’s that end- to-end stakeholder management that’s important, with the CFO being a significant stakeholder across that decision making process. It’s become less about the finance and more about the business outcome.”
In moving away from the human calculator type view that previously dominated channel opinion of CFOs, the finance department is now showing its worth from a technology perspective also.
Because across Australia, the role of the CFO is shifting.
Following decades of traditional cost management responsibilities, local businesses are now calling upon finance to step beyond spreadsheets and numbers, to help the organisation identify new opportunities to drive growth in the future.
Specifically, Barlow said Brennan IT are engaged with CFOs around the adoption of cloud, unified communications (UC) and ways to maximise collaboration tools.
“They’re very happy with a hybrid cloud approach,” he said. “It’s a slightly different approach to enterprise and mid-market, where we’re seeing a great adoption of cloud and UC collaboration.
“But we’re still seeing strong adoption of services such as Skype for Business into a single platform, collaboration, and video conferencing - that has been a great take-up for us.”
As cloud technology adoption continues to grow in Australia, and investments increase alongside, Taylor mirrored Barlow’s observations, acknowledging the value of moving business process to the skies.
“Cloud-based technologies are the game changer for the next five to 10 years,” Taylor added. “Certainly, moving towards a cloud-based environment makes a lot of sense — you’re avoiding the capital investment in hardware and communications infrastructure.
“Cloud has transformed the way in which IT companies think about how they deliver the solution and the application to the desktop. It’s a more efficient process.”
Alongside cloud, Taylor also recognised the importance of mobility in supporting the emerging technologies infiltrating the business.
“It’s about how that delivery is expanded to applications on mobile devices,” he explained.
But in a direct word of warning to the channel, Taylor emphasised the difference between strategically investing in technology, compared to being seduced by common industry buzzwords.
“It’s dangerous to follow trends, that’s what IT companies want you to do,” he cautioned. “The key is to pick technologies that help with your business outcomes.”