I think we’re all seeing way more scrutiny than ever before. Me personally, I’ve never seen an environment like it. CFOs are tightening the belt on so many big spends. Even smaller ones.
Wondering what deal sizes you’re all noticing really bring out that add’l scrutiny? Is it $100K? Higher/lower? And how are you adjusting strategy accordingly if certain deal sizes are easier to push through - do you do anything differently, or still push for bigger amounts despite the conditions?
Hi Rupert - I think $100K is a safe benchmark, but I’ve seen the watermark go as high $150K and as low as $50K. I think the current environment has increased the importance of trust and testing your champion.
Your champion should have insight into what the benchmark is at their company. If they don’t, you might need to keep looking… if they do, I think it’s even more important to have a robust business case and that your champion knows how to sell your solution internally (if you’re aiming for a deal that you know will get in front of the CFO).
If you decide to lower the deal size to avoid the CFO, I think it’s important to consider whether the opportunity for growth in the account makes this worth your company’s time. If it is, even more important to define with your champion what the metrics for success will be so you’re able to build a strong business case when you eventually get to the CFO for expansion.
I think this is a great question, @Rupert. With the macro-economic downturn, I think CFO’s are more apt to look at EVERY dollar, not necessarily $100K. It’s no longer vendors competing against each other, per se, but more about “unbudgeted” funds and allocation of investment capital.
Understanding a prospects pain and their case for change and how it effects key stakeholders and Named Executive Officers is what’s going to get orders done. Just my humble opinion.
To me, it really depends on the situation. Here are some things to consider:
The company you’re selling to (size, industry conditions, how the company is performing at the time, how much cash they have on hand, whether the company is growing or contracting, if they’ve gone through a major layoff recently, what the executives are communicating publicly in regard to the company’s priorities (is growth or cost reduction a higher priority), etc.
What you’re selling and at what stage of the customer lifecycle. Is it a mission critical solution, does your solution align with an executive-level priority, does it solve a major business challenge or pain point, is it a land deal, phase 2, ELA? Who is your champion (seniority / tenure) and do you have one or more executive sponsors.
Is there a true compelling event? Do you have a solid and verifiable business case? Have you calculated (and has the customer validated) the cost of not doing this? Can you confirm the cost of missing the compelling event?
Are you selling to budget or cash?
According to stats, more CFO’s want to be engaged in technology and strategic discussions, and with good reasons" they control the purse strings and have a broad understanding of the strategic plans across the company. I invite CFO’s to the party (stating the above). It flatters them and gets them to the table with info the rest of C suite doesn’t necessarily have or understand. They also become an invaluable backdoor when blocked elsewhere in the organization. Gives you credibility and respect.