Show Me The Money!
Creating The Strong, Emotional Business Case.
In this month's TTS Newsletter we will look more closely at the third key: The Strong, Emotional Business Case.
What Is It?
Any time your customer is about to spend a significant amount of his scarce resources (money & labor) a formal request is necessary, called the budgeting process. During the budgeting process, the executives and financial professionals evaluate and compare various funding requests in order to create the business case.
Why Do We Need A Business Case?
Your client needs to attain visibility to heighten the need for the project. She must be able to obtain the resources necessary for success. She will have to state a compelling business reason in order to obtain financial support internally. There is serious competition from various departments in a business to vie for very limited dollars. The business case is critical to determining which projects are approved and which projects are rejected or delayed.
How Does A Business Case Compare To A Value Analysis?
The value analysis and business case are very different tools despite the fact that many selling organizations tend to see them as one. The business case is used at the very beginning of the customer's buying process to determine whether an investment in the project is worthwhile.
Before vendor selection, a business case typically compares the status quo to a generic project.
In contrast, a value analysis is very narrow in scope. It is utilized toward the end of a buying process to help the decision makers make a final vendor selection. It compares the solutions offered by Vendors A, B and C on a feature-by-feature basis and tries to aid in determining the best choice. The reason that the business case and value analysis are frequently misunderstood is that the business case includes sections which compare the status quo (Vendor A's solution) to a preferred future state (Vendor B's solution).
Additionally both the Value Analysis and Business Case will include ROI (Return on Investment) and/or TCO (Total Cost of Ownership) analysis.
Why Must a Business Case Be Emotional?
Make no mistake. There is very fierce competition for scarce resources among departments within a business. I have spoken with several senior financial executives who all say that the budgeting process is similar to a child pleading for 50 gifts from Santa. Santa can't give 50 gifts to every child. Successful budget requests will need to be strong and emotional to separate themselves from all of the other "urgent" requests.
What Is An Example of An Emotional Business Case?
Let's say you sell cloud-based storage software within the healthcare market. The business case could include the standard Excel spread sheet and financial department budget request form. It could mention the speeds, feeds and capacity of the requested technology project. Or, the smart business case author could tell a compelling story of how access to stored information across the enterprise will improve outcomes and reduce costs by accelerating physician decision making. Maybe the author will include a case study documenting a
four-year-old's speedy discharge from the ER into the arms of her loving family the same day because of instant access to decision making information. The cover of the business case project document may include a large photo of a physician accessing data on a tablet while treating a smiling toddler.
Where In The Customer's Buying Process Is The Business Case Utilized?
As mentioned above, very early! Typically, no major purchase or project is formally initiated without budget approval. And the business case is critical to the budget approval.
What Does It Look Like?
Here is a sample of what the outline of strong, emotional business case would look like:
- Executive Summary: Present State--Future State. Highlight the challenge or opportunity
- Emotional Story
- Alignment with Corporate Strategic Goals (HINT: If you cannot tie the project to one of the top three corporate initiatives you are spinning your wheels. You must make the strong connection between a top corporate strategic goal and the requested project)
- Alternatives & Favored Option
- Show Me The Money (Financial Analysis which will likely include TCO - ROI - NPV (Net Present Value) and/or IRR (Internal Rate of Return)
- Estimated Timeline & Implementation Plan
Who Should Create This? Isn't This The Client's Job?
If you are an average rep, the answer is that the business case and budgeting process are the responsibility of the client. If you are a Superstar, you know that you will gain tremendous trust if you can be a valuable resource to your client. Assisting with the budgeting process and business case positions you to act as a trusted advisor to your client.
How Does A Customer Benefit From This Tool?
The client benefits by getting his budget approved. He also benefits by preventing project cancellation. A project without a strong emotional business case is in jeopardy of cancellation after a quarter or two of less than stellar financials.
How Does A Sales Superstar Benefit From This Tool?
As a trusted advisor, you want to be able to guide, teach, sell value, handle price pressure, create urgency and prevent project cancellation. Assisting the client early in her buying process with something as important as obtaining budget for a professional business case makes your customer look great in the eyes of senior executives. You become an invaluable resource.
Should I Slant The Document To Favor My Company?
My response here will be controversial. Unlike many, I train my future Superstars to understand the importance of helping the client create GENERIC bid specifications as opposed to slanted, lock-out specs (Lockout Bid Specifications Newsletter ). Your goal when assisting a client with either a business case or bid specifications is singular--GAIN TRUST. You will lose trust if you assist the client but take the opportunity to blatantly promote your solution. Remember this important quote, "Trust arrives on foot but leaves on horseback." You run the risk of losing trust if you promote your solution without the knowledge of your client.
What If A Client Balks At The Need For A Strong, Emotional Business Case?
This is not an uncommon objection. It typically comes from a mid-level manager who has little experience with major projects in an organization. Small projects often times do not need a business case. The best way to address this objection is to anticipate it. Use both positive and negative references from other similar clients. A positive reference would be a client who saw huge value in a strong, emotional business case. A negative reference would be a client who experienced chaos and disaster as a result of the lack of a business case. Perhaps the project was placed on the cancellation chopping block after 6 months of hard work by the evaluation committee.
Start gaining trust with your clients early in their buying process by assisting them with their budget and associated Strong, Emotional Business Case!
Good Selling!
