How do you effectively sell to Chief Information Officers? What are their drivers? A CIO responsible for multiple business units shares his first hand experience.

Insight #1: Know Me Before You Meet Me

Before you enter my office, know me. That may seem challenging since I don’t issue shareholder letters or get written up in the media like a CEO might. But here’s a tip: My priorities as CIO are wholly aligned with the objectives of my company’s CEO and CFO.

Reference annual reports and management presentations to discover objectives my CEO has set for insights into what I’m focused on.

Consider:

• My role is to further these objectives through the smart use of technology.
• My CEO and CFO are spending up to 20% of their time assessing technology decisions – and this percentage is growing.
• As CIO, my team is increasingly relied upon to drive business growth and profitability through application of user friendly technology.
• My clout as CIO within the organization can vary dramatically

To put this all into context, consider the scenario below. It outlines issues a CEO might include in a letter to shareholders and demonstrates how I might use those cues to improve my company’s competitive position through the smart use of technology.

If My CEO/CFO Issues Are To:

• Become more competitive in a more challenging environment
• Drive more profitable revenue
  • Increasing revenue 10-20%
  • Increasing Profit 5-10%
• Acquire other companies to grow market share

Then My Corresponding CIO Issues Are Likely:

• Cut maintenance, administrative and training costs by 50%
• Accelerate time to insight from hours/days to seconds/minutes
• Cut maintenance, administrative and training costs by 50%
• Integrate multiple information systems due to acquisitions

Your next step is to review industry and business analyses for broader insight into my issues and objectives within the context of my organization and industry. Here are four top CIO priorities for you to align your value:

• Delivering projects that enable business growth
• Linking business and IT strategies/plans
• Demonstrating the business value of IS/IT
• Applying metrics to IS organization/services

Insight #2: Apply Metrics to Your Value Propositions

By referencing metrics in your initial discussions with CIOs and later in your value propositions, you demonstrate you understand the linkage between your solution and the CIO’s measures of business performance.

But applying metrics to IT can be difficult. A sales professional who understands this – and is proactive about helping a CIO develop relevant metrics – will do well. Three things to keep in mind:

• Be prepared to add value by suggesting metrics the CIO might use to measure business performance. For instance, recommend metrics your other accounts have found valuable for quantifying impact
• Consider how your value proposition impacts CIO performance metrics
• Ensure the metrics you choose relate directly to the metrics the CIO is using

Using a similar CEO/CFO relationship as discussed earlier, here’s another example of how you may identify metrics to use when engaging CIOs for your value proposition.

If Meaningful Metrics For My CEO/CFO Metrics Are:

• Become more competitive in a more challenging environment
• Drive more profitable revenue
  • Increasing revenue 10-20%
  • Increasing Profit 5-10%
• Acquire other companies to grow market share

Then My Corresponding CIO Metrics Are Likely

• Expedite end-user access to information
  • Accelerate time to insight from 3 days to 2 hours
• System administrative time
  • Reduce from 8 hrs/week to 4 hrs/week per administrator
• Integrate multiple information systems due to acquisitions
  • Reduce reports from 4 separate to 1 integrated

Start Now

So how do you take these insights and sustain them over time?

Suggest an idea about every 90 days that will make the CIO’s organization more competitive through strategic use of technology.

Let us know your thoughts.

If you could find out how a customer executive you’re targeting is compensated, would you? Of course you would.

An insider secret: Outside of the U.S., in many parts of the world, details regarding how and why executives are compensated are spelled out in remuneration reports.

Thanks to U.S. Securities and Exchange Commission (SEC) requirements that companies disclose more detail in their annual proxy statements, anyone selling to U.S.-based accounts can find similar information.

The requirement is designed to give shareholders more information so they can cast informed votes – but there’s no reason you can’t use it.

Harvesting Proxy Statements

It’s important to get in the habit of reading proxy statements for all of your prospective and current publicly traded accounts.

Proxy statements are filed annually with the SEC and provide important clues as to how you should quantify your solution’s value.

In these statements, companies are required to disclose:

• What executive compensation programs are designed to reward
• Each element of that compensation
• Why the company chooses to pay each element of compensation
• How the company determines the pay for each element

In other words, you will discover exactly what motivates your target executives and quantify the value of your solution accordingly.

Proxy statements can be long, confusing, and painful but if you focus on a few key sections, you can scan them easily. Ignore stock options, pensions, and use of the company jet (however interesting those things seem.)

Instead, focus on:

Compensation Discussion and Analysis:

This section tells shareholders how top executives are paid and why they’re paid in that way. But you’ll be able to see what goals have been set for top executives. Think in terms of these goals when you explain the value of your solution to your executive sponsor.

Example: This General Electric proxy statement outlines a number of goals, including launching and improving products, attracting and retaining customers, and increasing productivity.

Demonstrating your solution’s benefits in these terms will increase your chances of success!

Executive Compensation Components:

You’ll find the Executive Compensation Components section under Compensation Discussion and Analysis where the company outlines specific goals it set for top executives. In the case of financial goals, it lists specific numeric targets. For strategic and operational goals, it mentions how performance in reaching them is measured.

Example: GE CEO Jeffery Immelt’s goals included increasing annual revenues to between $160 and $165 billion, boosting cash flow, driving 8 percent organic growth, and keeping GE high on the “most admired companies” lists from FORTUNE, Barron’s, and the Financial Times. At Gannett, the proxy statement shows executive pay is based on how well the company competes among digital media.

Ever use a proxy statement to assess your target customer goals? Share your experience and tips by commenting below!

Money is tight and budgets are strapped, whether you’re talking about the euro, yen or dollar.  Anyone selling to government entities today knows it’s a problem. As a result, many officials are turning to the private sector for help.

Now’s the time to capitalize on this increasing trend toward public-private partnerships (PPPs). Structure your proposals around these three critical PPP success factors:

1. Allocation of risks
2. Identification, allocation and limitations on rewards
3. Need for public accountability

After you accept the realities of doing business with government entities, you can start exploring the opportunities. If past efforts in the public-private arena have been less than stellar, note that circumstances are shifting.

The time is ripe to deliver heightened value to public sector accounts.

Example of why that’s the case in the United States:

The government’s  Government Accountability Office (GAO) and other fiscal oversight entities such as the Congressional Budget Office have declared federal fiscal policy to be "unsustainable" long-term. The reasons cited? Fundamental structural imbalances shaped largely by demographics, health care costs and the rising federal deficit.

It’s a similar story with many other countries at regional and local levels, where officials face shrinking federal funding while trying to accommodate increasing public requirements.

Add aging infrastructures and declining revenue sources such as property taxes, and state and local officials – are looking seriously at alternatives – like their federal counterparts.

That’s where you come in.

A new reality

Given disturbing fiscal forecasts, the question is: How will public entities afford what citizens expect in the 21st century?

Clearly, enhanced PPPs will be part of the solution – this excerpt from the U.S. Department of Transportation, Federal Highway Administration offers insight:

"Expanding the private sector role allows the public agencies to tap private sector technical, management and financial resources in new ways to achieve certain public agency objectives such as greater cost and schedule certainty, supplementing in-house staff, innovative technology applications, specialized expertise or access to private capital. The private sector can expand its business opportunities in return for assuming the new or expanded responsibilities and risks."

Factors for success

As you contemplate a PPP, consider risk, accountability and the other PPP success factors noted above to determine what you can reasonably accept and how you can deliver the most value for your government customer.

Remember that your government customers have different needs than CEOs. The government isn’t interested in profit margins. Rather, it needs to provide the needed service or finish the project at an acceptable cost.

The ideal solution accomplishes that goal while providing you with an acceptable rate of return for any risk you assume.

Visualize the finish line

A unique challenge of public-private partnerships is the transparency required. These projects require accountability to the public, which ultimately pays the bill. The public needs to see that its money is spent wisely.

Because of this challenge, some government agencies may try to prescribe exactly how the work will be done. Instead, have them define "end states." Allow them to specify the results they need and introduce efficiencies to achieve those results.

Due to those budget constraints noted above, you may need to help your government partners find funding for your project through PPPs. Since competition for capital is fierce, the sales professionals who are most successful help their government partners visualize the results, demonstrate the public benefit and find ways to earn a healthy return, often through "dual benefit" solutions that have both public and commercial application. That’s a win for everyone!

Any change in your account’s business performance or an unexpected market shift may signal a new selling opportunity. So how do you stay current on the latest challenges faced by your customer’s executives? Review transcripts from the company’s quarterly earnings calls. All it takes is three easy steps.

Step 1: Find your customer’s transcripts

Many companies make transcripts available on their Web sites. Also check third-party sites such as http://www.earnings.com. Be sure to also sign up for e-mail alerts so you’ll know when new transcripts become available.

Step 2: Start with the analyst ‘Question and Answer’ section

You’ll find the Question and Answer section at the end of the transcript. It’s the part of the call where the analysts who follow your customer year-round grill executives about underperformance or results that didn’t meet expectations.

Not only will you identify selling opportunities, you’ll also strengthen your credibility with your target executive by demonstrating your timely knowledge of the account and aligning your value to his or her most pressing priorities.

Three examples

• Starbucks
  Analyst to Starbucks: “Last year, you talked at the analyst meeting about a 20% top line and 20% to 25% bottom growth rate for three to five years, and now you’re talking about 18% top line and 20% to 22%. Is this a permanent slowdown in the growth rate of your business … or just the recognition that there are some temporary pressures both on the top and bottom line and we might resume that 20% to 25% in the future?”

  Your take-away: Insight for a conversation about revenue. For example: “Our solutions help retailers drive revenue by capturing new customer segments, increasing average transaction size and increasing repeat customers…”

• Qwest Communications
  Analyst to Qwest:“A couple of quick follow ups on the margins. The $24 million in facility cost reduction, I’m wondering how repeatable that is on a quarter-over-quarter basis. Looking at the cost of sales line item, it was roughly flat on a sequential basis.”

  Your take-away: The basis of a conversation on gross margin. For example: “Our solutions help service providers improve margins through improving product/service mix, helping maintain price points and generating new, high-margin service revenue…”

• MasterCard
  Analyst to MasterCard: “Should we continue to see $25-30 million sequential increases in G&A, and I mean beyond this year, or are you in a building process that runs through the end of this year and then we should see more modest G&A growth?”

  Your take-away: Rich background for a conversation on operating costs. For example: “Our solutions help lower operating costs by reducing G&A expenses and reducing depreciation costs through asset reductions…”

  Step 3: Scan the executive’s prepared comments

  Each key executive will offer a take on the quarter’s performance, following the opening disclaimer. Compare the current period to historical performance and identify trends you can leverage.

  • What is the forecast for growth?
  • What reasons do they cite if the forecast is not good?
  • What initiatives are highlighted as part of their strategic plan?

  Also look at solutions you have already sold them. How can they be applied to underperforming areas? What other steps would you propose?

  Whether you’re a manager looking for quick ways to boost your team’s CXO relevancy or a busy account exec looking for effective shortcuts, use quarterly transcripts  and you’ll stay on top of new selling opportunities.