I'm admittedly not a big fan of musicals. But a few years ago I took my wife to New York for an extended "Broadway Weekend" where we saw "Hamilton". I was blown away. In the musical, William Burr is the antagonist to Alexander Hamilton. Throughout the story Burr finds himself competing with Hamilton and often "one step" behind Hamilton who always seems to bein the mix of
key events that shaped the founding of the United States.
At one point, a meeting is brokered ("The Room Where it Happens") where a compromise is reached to put the Nations Capitol in the South (Washington, DC) and the Federal Bank in the North (New York City). And you guessed it, Burr was not included. It reinforced Burr's hypothesis. If he was going to influence events, he needed to be in the room!
During my career I have worked with many companies in a variety of industries and have always wondered why the Chief Sales Officer (CSO) is absent from "The Room Where it Happens." In this case it is the annual strategy/planning and budgeting process. Too often the CSO is not included and worse yet, some don't seem to mind.
It is in these meetings where among other items, the first line of the P&L (revenue) is set. If the CSO is not present, with a seat at the table, he or she will find it hard to explain to the sales organization a where the top line numbers came from. It will make it equally hard to set meaningful quotas. I have heard plenty of sales people say when annual quotas are distributed, "Who came up with these numbers and how am I supposed to achieve them." Further, I have seen CSO‘s that have not been involved at all levels of the planning process add additional revenue growth to the plan created by the rest of the senior team unknowingly adding unrealistic “stretch” goals.
There are a variety of reasons the CSO is not included in the meetings. Sometimes it is a simple oversight. The Chief Sales Officer is out on the road selling and therefore not always available. Sometimes the CEO and CFO believe they can access the data needed to make the decisions. Sometimes the sales organization has done a "bottoms up" forecast which is used without much context from the CSO.
Advocate your way into the annual planning process and meeting.
The average tenure of CSO's is about 2.5 years. I believe a contributing factor is that they are not involved in the overall strategy and planning process. I think every CSO, like Burr should want to be in "The Room Where it Happens.” And the CSO should not only be in the meeting but be an important participant.
Once the CSO is invited to join or advocates their way in, he or she must be prepared to provide value. The best way to prepare for the meeting and be relevant is to understand what levers can be pulled, and to what extent by the sales and marketing functions.
So what is a good starting point? What is a good way to think about growth? What should be analyzed? First of all, start more strategically. What's going on in the economy, in the market, the company’s sector and how can, or do those trends impact revenue growth.
Secondly, come down to ground level. Look at what is happening with the existing and potential customer base. What is the recurring revenue? This will provide the baseline from which to grow. Then begin to think about the options available to grow. What are the plans to grow organically vs. inorganically? How much will GDP provide, what is projected sector growth, how much can come from increased prices, share of wallet expansion, new products, new geographies, channels, and of course taking market share by selling new customers? By going through this process the CSO will drive the "Revenue Strategy" and gain a new level of credibility as a broader and more strategic thinker, constructively influence growth expectations, be better prepared to explain the growth to the sales team and most importantly have an impact in "The Room Where it Happens."