How to present value in business terms in the real world

A few years ago, I found myself in a two day meeting with a sales person, a technical presales person, and a client’s IT executive team. The company I worked for sold IT Service Management software and the client was a rather important client. The client as it turns out had attempted to purchase four hundred thousand dollars of software from us outside of their normal budget but the request had been denied. The expected budget for the following year to our company alone was 1.2 million dollars and was potentially at stake if we couldn’t figure this out. Needless to say our sales team and the VP of Sales were very eager for us to figure out why this request had been denied.

Now I was the senior ITIL trainer and consultant at the time. I had taught ITIL to the executive team and their staff to great effect. However, I wasn’t involved in software sales at all and spent the first day of this meeting wondering what I was doing there and how I might help. We tried all of the canned approaches to selling value, cost savings, headcount reduction, efficiency, process improvement, you name it we tried it. All of this came to no avail. The customer was a unique quasi-government-quasi-private-sector company. None of the traditional business or government drivers were of interest to the board of directors who had to approve these expenditures.

After the first day of meetings we were perplexed. Nothing we had tried had worked. The customer’s IT executive team, solid and experienced people, was looking to us to help solve this problem. The reality is that this executive team had more direct experience selling IT budgets to executives and boards of directors than I did. I was afraid that at the end of two days, I would have nothing of value to contribute. The night after the first day of meetings, I couldn’t get this dilemma out of my head. Eventually, I found the kernel of an answer from the extensive training I received in Economics. That kernel of wisdom was the idea that “value is in the eyes of the customer.”

The customer in this case wasn’t the IT executive staff of course. It was the board of directors. We knew that going in. However, we were trying to solve an IT problem. After all the software in question was intended to help the IT Department improve performance. How did we translate that into something the board cared about? The second morning, I began asking questions about exactly what the board wanted. More specifically, I asked about what the board had published. The first and most important publication of any board of directors is of course the company’s Annual Report. It just so happens one of the executives had a copy of the report that had just come out. In that report the board had published their recently completed business model.

The board was very proud of this business model and had a powerful high-level graphic of the model included in the Annual Report. They also had a detailed graphic for internal use. Keep in mind that this is the business model for the entire company not just the IT Department. The first item covered in the Annual Report in relation to the business model is the increased effort to cultivate the company’s knowledge base. Bells started going off in my head. Knowledge bases, we knew about knowledge bases. In fact we sold several. The next item that caught my attention under leadership training was the need to manage conflict and change as well as to develop flexibility. Wow! Change Management, we knew about change management and we had products. The next item was cultivating long-term relationships. Service Level Management, we knew about that.

If this wasn’t enough, the detail graphic had a section that specifically identified processes. Under this section they listed: policies and procedures, control objectives, service management rules, and project management. When I saw all of this, I knew exactly what was needed. We knew that the IT staff were presenting too much detail too directly related to IT and that they weren’t engaging the imagination of the board in any significant way. In front of me was the perfect solution almost on a silver platter. In fact, the business model graphic is round and when printed in black and white looks very much like a silver platter.

When I returned home after that second day, I immediately opened up Adobe Illustrator my graphic tool of choice and began creating a business model for IT. Where it listed Critical Functions, I changed it to Critical Processes and listed the Service Support processes. On top of this list I placed Customer Relationship Management instead of Service Level Management, parroting the board’s own language. Under every heading of the business model there were specific IT Service Management terms that directly related to what the board was trying to achieve across the entire company.

The IT business model formatted exactly as the board’s business model related everything IT was trying to achieve directly to what the board was trying to achieve. The board could immediately imagine that IT understood what it wanted and that IT had a plan to get there. Under the section listed Processes, ITIL, PMI, and COBIT were listed. The board quickly understood that these acronyms related to IT processes that were essential. In fact under every major and minor heading on the graphic some element of IT Service Management was listed. From that point, the result was a foregone conclusion.

The IT Executive Team no longer spoke about what IT needed to accomplish its goals. They began to speak about the business goals and demonstrated in visual terms exactly what IT was doing to facilitate those goals. Now when they asked for four hundred thousand dollars out of budget they weren’t asking for some obscure IT only software application that did who-knows-what. They were saying that the business wants processes, controls, and business practices, IT Service Management is the IT industry answer to these needs, and the money is needed to purchase the software that provides exactly what the board is asking us to do.

Now IT was no longer telling the board what IT wanted to do. IT was telling the board this is what you asked us to do. This is what your business model looks like translated into IT terms. To accomplish your business model, IT needs to spend money in this specific area. The four hundred thousand was no longer money for IT; it was money to achieve the Board’s Business Model. That expenditure was quickly approved. The next year’s projected IT budget of 1.2 million during one of the worst recessions on record was locked in at 1 million dollars.