‘Mad Men’ Has The Answers to Your IT Budget Woes

This is the first in a series of articles that will explore
techniques for how to sell your projects as we enter the final budget crunch
phase of the year.

Meet Christine

Christine is the CIO of a $400 million manufacturing company. Like you, Christine is about to enter Q4. She is bracing for the final
budget approval and crunch process. She knows that this year it’s gonna be
tough.

So far, Christine has managed to “protect” her placeholder budget of $2 million for a cloud migration project. It’s a very important
project with a strong business case. but she knows it’s going to be a hard
sell. No sexy front-end user functionality. This is all about infrastructure.
And nobody likes to fund infrastructure.

Christine, like most IT leaders, finds it difficult to “sell” her projects. Her idea of selling is to explain the important reasons
and rationales for doing a particular project. She likes to present a
compelling case and have the executive leadership carefully weigh the facts and
figures and then make a thoughtful, rational, fact-based decision.

Reality Bites

Well, the fact of the matter is: That’s not reality. Getting the funding you need for important IT projects just doesn’t go down like that in most organizations. The executive team needs to buy into your initiatives. And
that means that you need to know how to sell. You need to know how to persuade decision-making executives to fund your projects without relying solely on facts and figures. Here’s the basic idea: Take a leaf out of the sales book used in the world of advertising. I’m not suggesting you adoptall the antics depicted in the popular TV series "Mad Men" (although
a Martini and a spiffy suit never hurts). But there is one tried-and-true method that Madison Avenue has used for decades to move people to take action that you can apply to your own internal sales efforts.

It’s not just the CIO who needs to know how to sell. This is
a skill that is needed by IT leaders at various levels of the organization.
Business analysts need to sell their ideas. Project managers need to sell their
approach and plan. Senior IT managers need to secure project budgeting from
business lines. And CIOs need to gain approval from the executive team or the
board.

So, given the importance of this skill and the time of year,
I am dedicating the next several columns to showing you some hands-on,
influence-wielding techniques that will automatically position you for success
when you go to sell your projects. These are techniques for real hand-to-hand
combat in the budget fight.

And to keep it real, we are going to go back to Christine
and her specific case.

Back to Christine

Christine’s total OPEX project budget is $4 million, so her
$2 million placeholder budget for just one project screams out for attention
(i.e., cutting). Christine is smart enough to know this, and she has turned to
her trusted advisor, Martin, for some help in how best to present the project
given the situation.

We’ll drop in on the conversation between Christine and
Martin shortly after she has fully briefed him on the situation.

Martin: Chris, it’s mid-September and you still have the
placeholder. That’s a good sign. It means that your boss and the exec
leadership still want to do the project. They are probably going to lean on you
to cut the budget, but the project is pretty safe.

Christine: What makes you say that?

Martin: If they weren’t really behind it, they would have
cut it already. It’s a quick and easy kill. It’s large and high profile. And
cutting it could make a lot of people happy because it would free up a lot of
money for other items. So there must be strong support for the project.

Christine: But I have been in similar situations where I
thought just that and then after I went in and did an incredible presentation I
was still totally cut down.

Martin: I see. That’s unusual. Did you use the Madison
Avenue presentation?

Christine: The what?

Martin: The Madison Avenue presentation. It’s a very
powerful presentation technique for getting a client to say “yes” to your
proposal. It’s a technique that is most frequently associated with advertising
executives who want to sell a client on an idea for a campaign. And it
satisfies a number of the key psychological needs a client has when asked to
approve funding for an idea or program as opposed to when they are being sold a
fixed object.

Christine: Interesting, tell me more.

Martin: The basic idea behind the Madison Ave presentation
is that you never present one option. When you present one option you set
yourself up for a yes or no. And if things get rough, it’s always easier to go
with no. So, in place of the single option, you present three options. Mind
you, that doesn’t mean you absolutely must develop three options. You can have
just one real option. Just make sure you present three options. Madison Avenue is famous for that. They develop one good
campaign for the client. Then, a few days before the big client meeting, they
quickly throw together some crappy ideas to present alongside the really good
idea. The client would of course throw out the obviously bad ideas and select
the good idea feeling very pleased with himself for his brilliance.

Christine: Very smart. But we can’t develop bad ideas so
easily. There is really only one idea on the table.

Martin: Not so at all. There is indeed one general project
placeholder with one general number. It’s now up to you to develop three
flavors of the project.In simple terms think:

  1. the large-scale, ultimate
    version

  2. the small-scale super budget version

  3. the middle-ground
    version

It’s the Madison Avenue presentation customized to IT projects.

And since your executive team is just like the rest of them (trust me, they are) your budget defense presentation will go like this…

You will start off by telling the executive team that this
is a very important project and you have therefore developed a few options for
them to review and to help decide upon. They will all nod with satisfaction
that they are being consulted.

First you will present the large-scale, Rolls Royce version
of the project with a price tag of $2.2 million. Gasp. Shock. They will likely
find it very appealing but will immediately say that’s too much money. It’s
even beyond the original budget.

Then you will present the small-scale version. It will lack
the key things they want to see. It will barely answer the other requirements
and it will be painful to do. Its price tag: $1.1 million. This too they will
reject.

Finally, you will present the middle-ground version (the one
you had in mind all along) for $1.725 million. It will have nearly everything
as in the $2.2 million proposal. You will sacrifice only the elements that you
know you can.

This version will win nearly immediate approval. But then
the CFO will insist that you find another $100,000 savings and will cap you at
$1.625 million. You will cry and complain and tell him how hard it will be–that
you can’t do it.

With a look of satisfaction that he has indeed reached rock
bottom and has shaved off $350,000 from the budget, the CFO will relent and say
“Fine. Do it for $1.65 million.”

Game over. You win. Because, all along, you never planned to
spend more than that anyway.

That’s technique #1

So, there you have it. The Madison Ave presentation. A
solid, reliable old-school sales technique that keeps the buyer’s psychological
needs firmly in mind.

About the Author

Marc J. Schiller, author of “The 11 Secrets of Highly Influential
IT Leaders,” is a speaker, strategic facilitator, and an advisor on the
implementation of influential analytics. He splits his time between the
front lines of client work and evangelizing to IT leaders and
professionals about what it takes to achieve influence, respect and
career success. Download a free excerpt of his book at http://11secretsforITleaders.com

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