Why Sales & Marketing and Finance must work together

It’s a rivalry as old as time. The ‘big spenders’ versus the ‘fun police’, or so traditional perspective would have us believe. But times have changed, and as a result, relationships have been forced to evolve, and that includes the very notion of oppositional departments. The question is, have they evolved enough? CFO Magazine spoke with five successful CFOs about the importance of finance and sales/marketing synergy and what that looks like today.

Angela Dagaris, GM, Growth CFO

The relationship between the Sales and Marketing team and the CFO is one of the most critical for any organisation, says Dagaris.

“The Sales and Marketing team has the largest impact on the financial health of your business,” she says. But a business is only as strong as its weakest department, so for a healthy and sustainable business, all departments must work together and work towards the main goals, she says.

“The finance department offers an impartial and full view of the business, which is critical to round out sales and marketing, which may be more biased to ‘ring the bell’ and acquire new customers at any cost.”

If we lean into traditional views, explains Dagaris, the sales and marketing team may see the finance team as the ‘fun police’.  Conversely, the finance team may see the sales and marketing team as ‘loving a junket’, without wanting to be held responsible for ROIs or payback on spend. 

“With the modern CFO now playing the role of strategic and growth partner, these barriers are coming down by working together to evaluate and select initiatives that create a win/win across the business, its clients and end customers.”

With the CFO now playing a true leadership role, it’s more important than ever for these roles to become trusted partners and dissolve the traditional ‘opponent’ views. 

“When a CFO understands that the Sales and Marketing department’s aim is to grow a happy and sustainable client base, this allows the CFO to see the marketing spend as an investment.

“Similarly, when the Sales and Marketing department see the CFO’s role as to support the review and selection of the best strategic decisions for the overall business health, it allows them to be open about their ideas and accept that not all decisions will make the cut, and nor should they.”

In her role, Dagaris ensures both departments form part of the key leadership team, meaning everyone collaborates on major decisions and has a “seat at the table”.  

“This includes our weekly leadership meetings, and quarterly and annual planning sessions, which ensures collaboration for the major big rocks and all the way down to delivery and execution.

“Most importantly, it means we all have a great working relationship and look forward to collaborating together.

“There is no doubt that disagreements will and should happen if you are pushing to accelerate growth, but with the knowledge that you’re a team, it allows the business to resolve these matters quickly and fairly, which allows all parties to move on quickly.”

TOP TIP – Get into the weeds.

“By creating a relationship based on trust and teamwork, the sales and marketing team will feel more comfortable coming to the CFO with questions and vice versa. This means getting into the weeds and learning about matters which CFOs don’t often get involved with -branding, SEO, marketing strategies, sales strategic partnerships, sponsorships, and events.  This allows the CFO to contribute to strategy formation and business case modelling, which the sales and marketing team will love you for.”

James Solomons, Xref, Global CFO

It’s important to remember that in most businesses, sales and marketing are two separate departments with distinctively different roles – both equally as important to the CFO and finance department as each other, says James Solomons.

“These relationships are critical to the success of every organisation,” Solomons says.

“One department promotes the widget, one department sells the widget, and the other department collects the widget sale proceeds and then works out how much to reinvest in promoting the widget some more,” he says, highlighting that all departments are intrinsically entwined.

“If finance does not invest enough, marketing cannot generate enough leads, therefore sales could be under target.

“If marketing does not return a strong ROI on the money provided by finance, sales may struggle to sell, meaning finance is not collecting enough money and this can reduce spends in other areas.

“If sales do not convert leads, finance does not collect enough funds, and therefore has to reduce the funds given to marketing, which can reduce lead flow moving forward.”

Poor communication and lack of transparency are key contributors to conflict between the departments, Solomons explains.

“In good and especially in tough times, being transparent on results allows all teams to work together to increase ROI/lead conversion,” he says.

“Market factors can impact results and all parties need to make sure they don’t take things personally when questions are asked about those results.

“In the end, everyone is on the same team, all striving to promote the products, sell the products, and to ensure long term financial sustainability of a business.”

Leaders, including CFOs, have a responsibility to understand what other teams do and what their priorities are, he says.

“Nobody is exempt from this requirement. If there is no knowledge of what the other team’s role is, then it is impossible to be able to have constructive conversations around results and how to improve.”

Underpinning the importance of these relationships at XREF, the head of the sales teams reports directly to Solomons.

“Marketing, being our second largest investment line, outside of wages, will always have plenty of attention from the CFO.

(It’s about) being open and transparent. And being respectful. I also try to focus on removing roadblocks and being an enabler to both areas.”

High functioning sales and marketing teams ensure a business maximises its investment in those departments, which keeps the sales flowing into the business.

“Under pressure, people can take disagreements personally and so it is important to remain focused on the data and what it tells us, along with ensuring we all focus on finding positive resolutions to any issues that have arisen,” Solomons explains.

TOP TIP – walk in their shoes.

“The best way to understand how the mind of a marketing person works, is to spend a week with them, to understand the way they view ROI, and how to make money from the money you give them.”

Wayne Banks, CFO Advisory Director, SAP Australia & Former CFO

While the finance, sales, and marketing teams should each be focused on the strategic deliverables of the organisation’s strategic plan, lack of respect and understanding of each other’s specific roles can cause conflict between the departments.

“Finance is often seen as the deal killer or sales prevention department,” Banks explains.  

“Marketing is perceived to spend with little to no result. And sales is seen as the group that sell at any cost and price.”

Collaborative relationships are critical for success, he says. 

“I once had a sales director say, ‘Wayne you are the strangest CFO I have ever met, because you actually really help me get deals done and add lots of value (and not get in the way).”

Doing so benefits everyone in a variety of ways, he says, including improved financial performance, better decision making, improved communication, and increased trust:

There are some things to be careful of though, says Banks, such as conflict of interest, insularity, and lack of accountability.

“If the CFO and Sales Director have a very close relationship, it can sometimes lead to a lack of accountability. For example, the Sales Director may be less likely to follow established financial policies and procedures if they feel they can ‘get away with it’ because of their relationship with the CFO.”

Groupthink is also a risk when relationships are too close.

“If the CFO and Sales Director always agree with each other, it can lead to groupthink, where they don’t consider alternative perspectives or ideas, which can ultimately lead to poor decision making.

“Overall, a positive working relationship between the CFO and Sales Director can have significant benefits, but it’s important to be aware of potential drawbacks as well and work to mitigate them.”

TOP TIP – SHARE YOUR VISION (AND KNOWLEDGE)

“Sit with the sales folks in the office, spend time with them chatting over a deal at the water cooler. Add value about the customer/prospect that sales may not know – a recent merger, industry pressure, new CFO etc. Leaders need to make sure the entire organisation is motivated to go the journey.”

Edwin Ang, Finance Director, foodpanda

Edwin Ang’s first finance manager role was supporting the CMO team at Telstra, including 40 of Australia’s best marketers, looking after brands, campaigns and sponsorships of major sports organisations, including the NRL and the AFL.

“I sat with the CMO team to understand what they did and help with their major pain point – Budgeting.”

A decade later, as the Finance Director at foodpanda, Ang sits directly behind the CEO, working closely with the sales, commercial, operations and marketing teams.

Positive relationships are at the heart of how Ang supports each department to help drive growth and profitability. He achieves this through regular catch ups, informal get togethers, and fostering a culture of partnership.

“Trust, respect and collaboration are vital for departments to work well together,” says Ang.

“Sales are the rainmakers, whilst marketing usually has the most budget. The performance of these two departments significantly impacts the company’s performance and all finance KPIs. 

“A great relationship with sales and marketing is vital to ensure everything is adequately planned, resources are maximised, and there are no surprises during month end or at the end of the year.”

Poor relationships are usually caused by “typical finance professionals” who only go to sales and commercial departments when they want something.

“There is no relationship or rapport building before they approach. Everything is urgent, and every little number counts,” he says.

“Sales and marketing usually only care if they are going to hit their sales targets and bonus goals, and directionally which way the financials are going.

“Finance needs to help interpret this and share the results in a meaningful way so the stakeholders can understand the financial impact. 

TOP TIP – ADD VALUE

“My main priority is always to ensure the relationship is positive. Finance will always need something from sales and marketing and vice versa. I ensure my team adds value before asking for anything in return. Initially, I like to get coffee with my main stakeholders to get to know them outside of work and understand their main challenges.”

Payal Kapoor, CFO, South Eastern Sydney Local Health District

According to Payal Kapoor, finance sits almost at the centre of functions alongside the core operations of any organisation.

“The relationships between finance and other teams are critical for the long term success of the business, since finance provides the budgets within which various initiatives can be undertaken,” says Kapoor.  

Finance can provide an objective lens as well as governance in assessing the cost benefit of various planned initiatives, she says.

In a previous role, heading up the business partnering function at one of Australia’s largest aged care providers, Kapoor went beyond core roles, analysing personalities to ensure key players in each department brought out the best in each other.

“I identified a slightly more outgoing personality to be (the sales and marketing) business partner, given most people in the sales and marketing function are generally gregarious and very good with communication.

“The finance business partner was seen as very trusted advisor, and over time an extension of the sales and marketing team. The partner would be invited to any celebrations or team events that would be undertaken.”

Kapoor recommends investing time in understanding your peers across all departments, especially sales and marketing.

“I remind my team that we are all a part of one organisation and that we are an extension of each business unit. I also take every opportunity to create awareness and profile for finance teams, and how we can add value – financially but most importantly in achieving the key outcomes of the business unit and the organisation as a whole.

“Customer engagement and strong business outcomes are key performance indicators in my team’s assessment. In my experience, all the finance members really enjoy this part of their job – broader than just number crunching without any real understanding of what, how, where, when and who.”

TOP TIP – FOSTER A ‘ONE-TEAM’ MINDSET

“Entering a conversation with one team mindset is a game changer. I encourage my teams to do the same. I also continually invest in relationships, so when the times get tricky, the disagreements are relatively easier to solve. The business partners are highly encouraged to continually invest and grow their relationships as well.”