Learn which numbers matter most, and how to frame them up with your team. Learn how to speak finance, even when it's not natural, as well as how to get the most from your number crunchers and leverage them for success.
- Sales is all about the numbers. Actually, that's not really true. Sales is about customer impact, but the numbers are a snapshot that reflect how you're doing with your customers. So one group of people that you always want to stay friendly with is your finance team. As a sales manager, you need to understand how the financials of your organization work. You know, one thing I learned early in my career was if you don't understand the big picture financials of your own organization, it's going to be really hard for you to understand the decisions that senior leaders are making.
So as a sales manager, it's not enough for you just to drive revenue. You have to understand which products are profitable, what types of customers are more valuable than others. Your understanding of the financials is the difference between you staying as a mid-level manager and you being viewed as someone with real senior leadership potential. Chances are you were probably chosen for your position as sales manager because of your abilities with people and your tenacity, not your ability to unpack a complex profit and loss statement.
But finance is the language of business. You need to understand where does the revenue in your company come from? What are the fixed costs? What's the value of your current holdings? What's the net margin? What's the ROI on an investment in your business, et cetera. So take the time to look through your annual report. Ask questions. Finance is one of the less sexy elements of business, but it's also a linchpin. You know, another element of finance is the role they play with your customers.
Generally speaking, finance is the group that bills and collects, so you want to make sure you understand their function, and you always want to have some good will with the finance people in case you have a problem. So as a sales manager, there are three rules I recommend you follow. Number one, understand the big picture of the financials in your organization. Number two, learn to speak finance. Know the terms and what they mean. And number three, create goodwill with the number crunchers.
They have a very tough job, and you want them on your side.
- Understanding your role
- Setting the tone as manager
- Recruiting the right people
- Dealing with inherited bad talent
- Making sales meetings count
- Working with marketing, accounting, and product
- Communicating with senior leaders
- Dealing with failure