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!