Free HR Webinar on Convincing Leaders to Buy Your Ideas
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Ascentis recently hosted a free HR webinar titled Getting to Yes – How to Have Leadership Buy Into Your Ideas. This free HR webinar recording is approved for 1.0 free SHRM credit and 1.0 free HRCI credit and available to watch here. One of our expert speakers from this webinar–Linda Ruffenach from Mercer PeoplePro presented on this topic on innovation and wrote the below reflection on this topic.
Show Me The Money! Building a Proper Business Case
by Linda Ruffenach
In the recent free HR webinar, I discuss getting leadership to invest in your ideas. Have you ever had an idea that you knew would change the business for the better but could not get anyone to listen? Or your idea was discounted because it was people related and felt too fluffy? Without data, it can be hard to get anyone to listen. That is where a building a basic business becomes important.
As a former COO, CFO and CEO I had the unique experience of being on both sides of the negotiating table. As the COO it was my job to put forth initiatives that would move the business forward increasing profits and productivity. Before spending money outside of my budget, I first had to gain support and buy-in from the CFO. Proving the ROI (return on investment) was essential to winning over my peer. When I moved from COO to CFO and eventually CEO I had a far greater appreciation for the importance of vetting proposals that required investment. I was now even more accountable to our shareholders and had the responsibility of assuring each dollar we spent was done with a clear objective in mind.
This got me thinking about the best business case presentations I’ve encountered. They had a few common characteristics:
- Know your audience. Focus on the needs of the decision maker. Determine who it is that you need to get on board. This may be an individual or may be a group. What is it that they need to be successful? What is important to them? How do they measure success? What types of problems are they trying to solve? Can they help influence other key decision makers? This is the time to worry less about what you want and more about what they want.
- Define the problem. Now that you know what’s important to your audience, present the problem in a way that they can relate. For example, if you are presenting to the CFO and their success is measured by profitability, relate the problem back to the impact on the bottom line. When I was COO we made the strategic decision that investing into improving our facilities would reduce turnover. When presenting the idea to the CFO we outlined the capital investment in terms of how many people we would need to save to recover the investment, backing up our strategy with exit survey results that said safety was a concern. We used assumptions we knew the CFO would not dispute such as the cost of turnover. For one location with 300 employees, we requested an investment of $15,000 into leasehold improvements all related to employee comfort and safety. The CFO had already provided us with the conservative estimated cost of turnover being $5000 per person. We just had to convince him that we could save 3 additional people each year ($15,000 investment / $5,000 per person cost of turnover) to recoup the investment or a 1% annualized improvement.
- Create a vision for the future. Illustrate what the future could look like. This can be done through words, charts, pictures or spreadsheets. The focus is on bringing the possibilities of life, showing your audience how things could look if they would invest in the solution. You want them to be ready to take action. For this particular investment, we created before and after images of the office. We showed pictures of broken equipment, missing lights, and torn furniture.
- Present your solution and beware of counter arguments. Now that your audience is hooked, show them how you make their dream a reality. Clearly, connect the dots between the problem and the solution. This is the most important part of the presentation. If your connections are not sound the whole thing could fall apart. This is where knowing your audience is incredibly important. Be wary of using the same ROI for multiple investments. For example, in addition to the leasehold improvements, we wanted to increase wages, modify our attendance policy and increase the events budget. All of these initiatives were intended to improve turnover. Individually they made sense but when you combined the total investment and compared it back to required combined turnover improvement turnover it soon began to look unrealistic. This where the next recommendation comes in.
- Be willing to negotiate. Know going into it that everyone wants to feel like they have won. And for some, the wins come from negotiation. Know what you are willing to give up and if you have several investments to make like we did in the case of reducing turnover, know your priorities. We knew we would not get everything improved but going into it, we knew the two things that had to change was starting wage and the investment into the facilities. We knew that these were the most important for us to push through. In the end, we gave up on the increased budget for events and changes to the attendance policy,
In the end, we were able to get what we wanted to be approved and a few months later were able to prove that our recommendations resulted in a dramatic drop in turnover thus earning us the credibility with the CFO so that the next time we wanted additional dollars we would have their support. Of course, the next time operations asked I was now the CFO which made the business case that much harder to win.
Click here to view our free HR webinar recording on getting leaders to buy into your ideas and by viewing this recording you can earn free HRCI & SHRM credits.
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