Posted by Chuck Csizmar | Posted in Articles, Universal Compensation | Posted on 03-06-2016
A number of years ago I sat in the office of my Chief Operating Officer, part of a project team presenting a recommendation for a number of adjustments to the company’s management incentive plan. Our key “improvement” was that we wanted to expand the eligibility.
After quietly listening to our proposal the COO leaned back in his chair, tented his palms in thought, paused for a bit, then asked us, “What’s in it for me?”
At our collective blank look he slowly shook his head then tossed our report back to us. “Tell me what the company is going to gain in return for this increase in fixed expense.”
In our defense we tried to justify our recommendations with broad comments like “The surveys say,” or that “It’s the right thing to do,” but when he started to frown and grow agitated we knew the game was up. The meeting was over, as was our proposal.
I gained a few bumps on the noggin that day, but learned a powerful lesson at the same time. You have to understand the financial impact of your recommendations, as well as how they would help the organization and thus justify that financial impact. You have to create, as best you can, a win-win scenario for the company as well as for employees. Otherwise, you’ll be labeled with recommending increased costs and trying to balance that negative with a vague, yet hopeful maybe.
The Finance folks won’t go for it. They’ll never agree that hard costs (real payments) can be balanced (equaled) by projected savings or estimated revenue gain. They don’t like dealing with what they call “soft” money.
Btw, it also helps to be aware in advance the various management biases that you’ll likely face during conversation with individual senior managers. They have them; we all do.
In other words, you have to broaden your thinking to consider business angles and perspectives as would an operations executive. Sticking to only a narrow HR-centric view of the organization can blind you from seeing the big picture, every time.
What To Do
In preparing your proposal presentation for senior management, or even for your own manager for that matter, keep in mind a few bedrock selling principles.
- Know what your new / increased costs are likely going to be (impact on the business).
- Be able to show (specific illustrations) how your recommendations will solve a real problem (“We need to do this because . . . .”).
- If your proposal balances costs against gains (revenue, savings, productivity, etc.) be realistic that such gain figures are usually optimistic estimates.
- Be able to show (specific illustrations) what would happen (the dark side) if your recommendations are not approved – or if the status quo is allowed to continue.
- If there are potential glitches (or risks) to implementing your recommendations, point them out as possibilities before someone else does.
- Avoid as much as possible the “soft sell” that I had tried with my COO. It can work, in some organizations, but can also be easily dismissed by a more critical senior management.
For a better success rate I suggest that you stick to a simple formula; 1) Demonstrate the problem (insert specifics here), 2) quantify the impact of that problem, 3) recommend a solution, 4) quantify the cost of that solution, and 5) show (insert more specifics here) how your solution solves the problem.
Don’t simply tell management that all will be well if they approve your plans, but show them, repeatedly with facts and figures that yes, indeed, tomorrow can be a better day.
Show them what’s in it for them; what’s in it to the betterment of the business.