A Non-Negotiable Essential: Crafting a Solid Business Case for Tech Investments
In today's stringent economic climate, securing buy-in for investments without a well-articulated, financially-sound business case seems like an uphill battle.
A recent Gartner behavioral survey reaffirmed this notion. Surveying 3,000 key business heads across different domains - finance, HR, marketing, sales, customer support, and supply chain, the results were telling: A staggering 98% emphasized their diligence in calculating the impact of tech-related expenditures prior to investing.
To quote Gartner: “This reiterates the importance of comprehending the business case - the 'why' - while catering to business buyers or persuading business stakeholders."
It's vital to remember, crafting this business case isn't a one-person endeavor. As per the survey:
And the predominant motivation for software acquisitions in 2023? Productivity enhancement, a sentiment echoed by 37% of business leaders. This was closely tailed by technological upgrades (32%) and looming cyber threats (30%).
Implications for Solution Providers & Sellers
Frequently, the task of formulating the business case falls to customer business units and the individual decision-makers / champion. The challenge they often face is an absence of the right resources. Yes, they're equipped with an ROI blueprint by central IT or finance, but the onus of identifying the potential benefits, costs, and risks predominantly rests with the purchase team.
This can culminate in a prolonged period of indecision, translating into longer sales cycles for solution providers.
To bridge this gap, it's incumbent on you, as a solution provider, to guide your clients through:
Notice how this goes beyond just a simple presentation of a magical ROI percentage. You have to collaborate on and present a complete business case for solution consideration, covering: the pains and impacts, painting a solid vision for the future, and providing credible proof points for assured success.
Besides the delay in the decision, if customers go it alone in preparing the business case, they're likely to miss out on your unique benefits, value assurances, and key proof points, making you susceptible especially when decisions move up the chain.
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In the absence of distinct differentiators and compelling narratives, your price point might be scrutinized, potentially swaying decision-makers towards more economical alternatives.
The Bottom-Line
The expectation of a financial justification for tech investments is omnipresent, echoed in 98% of all potential deals.
Regrettably, comprehensive business value analyses are limited to a fraction of the deals, mainly the high-ticket ones. This leaves customers to grapple with constructing business cases independently, a task often marked by frustration and extended timelines. For sellers, this means prolonged sales cycles and potential competitive incursions.
Reflect on the potential of moving deals forward by 1-2 months in a quarter or even a year. Avoiding last-minute hurdles or competitive switch-outs is integral. Assisting clients in their business case formation across deals can equate to quicker revenue streams.
Remember, the potency of crafting compelling business cases isn't just limited to the marquee deals; it's the key for every single one.
Join us in the Enterprise Value Collective to collaborate and share on topics such as this with those in the value enablement / consulting community.
Connect with me Genius Drive to discuss how we can accelerate and scale value best practices into all your customer engagements.
Sources:
GARTNER: Do You Want to Know What Matters To Business Buyers of Tech – https://blogs.gartner.com/derry-finkeldey/2023/02/15/do-you-want-to-know-what-matters-to-business-buyers-of-tech/
GARTNER: SaaS Marketers Lack Visibility Into B2B Software Buying Journey, Gartner Digital Markets Reports –https://www.businesswire.com/news/home/20230202005121/en/SaaS-Marketers-Lack-Visibility-Into-B2B-Software-Buying-Journey-Gartner-Digital-Markets-Reports
Absolutely, Tom Pisello, coming up with the ROI # is important, but the collaboration and working with your prospect is invaluable. It's a completely different type of conversation, and you will uncover things you never would through a typical discovery call.