How to make the CFO your new best friend
The CFO can be a revered and aloof figure in many B2B organisations, hard to reach and cynical about marketing. But it doesn't have to be that way, argues Joel Harrison
I’ve just spent a morning with nine senior B2B marketers who have completely confounded my expectations about how they collaborate and engage with their CFO. This roundtable was one of a regular series that we run for our B2B Marketing Leaders members, allowing B2B senior marketers in to discuss common challenges and share perspectives under Chatham House rules.
Part of the premise for this event was the age-old complaint from B2B leaders that their marketing budgets are constantly being slashed, that the CFO doesn’t understand them, let what marketing is or what it does. On the evidence of this morning’s roundtable, at least part of that is untrue.
Contrary to our expectations and stereotypes, most marketers in attendance said their budgets were holding up very well, thank you. And in those organisations where budgets were being reduced, for the most part, this was happening in a small and incremental way that was very manageable. This definitely bucked the conventional narrative around budgets, and as one attendee retorted, those who are complaining and acting put upon probably aren’t playing the right game.
So far, so surprising. But in terms of the extent to which the CFO actually understands marketing, the picture was variable, with responses ranging from “the CFO believes they can do marketing”, to “she/he doesn’t believe in marketing”, to “our relationship is best described as ethereal”. The tactics that marketing uses to get CFOs onside were many and varied, and typically were dictated by the context and circumstances in which they were operating. Bun-fights around marketing success metrics and attribution are the norm, if not universal, and need to be managed sensitively to prevent fallout with sales and maintain a united front. One marketer said his firm uses retrospective lead scoring to provide more clarity on marketing’s contribution to success.
There isn’t the space to provide an exhaustive transcript of the conversation, but here’s a snapshot of some of the most memorable observations and takeaways:
1. Be agile
Keep a portion of your budget aside for crises, whims or unexpected challenges, which can range from “we need to advertise at the airport because our competitor is doing it” to “I’ve just published a book and I want marketing to support it.”
2. Beware of ‘shadow budgets’
Where budget for a specific activity is removed from the central marketing budget, only for the leader of the territory or business function to pay for it through other means. This can distort the reporting on marketing effectiveness, making it look like you’re getting more done with less.
3. QBRs (quarterly business reviews)
These are a great means of making sure everyone understands what’s going on, and the impact it’s having.
4. The chief sales officer (CSO) is your friend
Build a united front with her/him in order before you seek to engage the CFO.
5. Understand your context and the agenda of both your CFO and the wider board
What they are trying to do will set your own agenda.
6. Earning respect takes time
Don’t expect the CFO to get marketing immediately. Expect to have to build trust and demonstrate success, particularly where an organisation is undergoing profound change.
7. If you really want to earn their respect, do an ‘understanding finance’ course
It might be the most boring couple of days of your life, but the CFO will look at you with new eyes!
8. The CFO and the board doesn’t have to understand the detail of what you’re doing
And you probably shouldn’t even try to explain it. But they need to know enough to trust you to execute.
9. Most CFOs want a smooth and steady flow of costs
Organise your marketing operations in a way that facilitates that can be critical. That might involve restricting, deploying agencies or even wholesale outsourcing. Proving success of this route can be a means of reintroducing headcount in the future.
10. “Are you seen as a cost-centre or a profit-centre?”
Most B2B marketers responded the former, or a bit of both… but were quite happy with that. The considered opinion seemed to be that it needn’t be a binary thing, and that a transition in thinking will inevitably be slow to achieve.