In today’s challenging economic climate, businesses need to be sharp and adaptable. This session focuses on how Chief Revenue Officers (CROs) can effectively present to their boards, especially when times are tough. We’ll explore practical strategies to make your board presentations impactful and demonstrate your value, even when the market is down.
Key Takeaways
- Understand Your Audience: Board members are individuals with unique interests. Research them like you would a potential client.
- Ground Your Updates: Always connect your revenue reports back to the company’s overall financial picture (P&L).
- Use Visuals Effectively: Employ clear, concise visuals like the "walk" chart to quickly convey key information.
- Map the Customer Journey: Show how new customers can grow over time, demonstrating long-term revenue potential.
- Focus on Churn and Retention: In a downturn, keeping existing customers is paramount. Present data proactively.
- Clear Slide Titles: Make your slide titles state the "so what" – the main takeaway for the board.
- Ask for Help: Leverage your board’s network and expertise to navigate challenges.
Presenting to the Board: A Different Ballgame
When you’re a CRO, presenting to the board can feel like a big deal, especially if you’re new to the role or facing economic uncertainty. It’s important to remember that a board isn’t just a single entity; it’s a group of individuals. Just like you’d prepare for a major client deal by understanding the stakeholders, you need to do the same for your board. Figure out where each member comes from and what they care about most. This homework will help you tailor your message.
Board members often sit on multiple boards, so they aren’t immersed in your company’s day-to-day. Your job is to help them quickly grasp what’s important. Think of it like a doctor reviewing a patient’s file – they need the key information presented clearly and concisely so they can understand the situation and offer the best advice. Your board presentation should be a streamlined update that allows for productive discussion, not just a one-way information dump.
Grounding Your Revenue Story
It’s vital to start your revenue update by connecting it to the company’s overall financial picture, usually the Profit and Loss (P&L) statement. Even if you’re focused on revenue, the board needs to see how it fits into the larger financial context. If you’re a CRO and don’t know your P&L, that’s your first priority. Your responsibility is to report on total revenue, whether it’s broken down into recurring, non-recurring, transactional, or professional services. Always map your specific reports back to the total revenue number on the P&L. This builds credibility. If the board can’t easily see where your numbers come from, you risk losing their trust before you even get into the details.
The "Walk, Don’t Run" Approach
Visuals are key to helping your board quickly understand your business. A great tool is the "walk" chart, which is common in management consulting and investing circles. This visual typically shows a period-to-period comparison (like Q2 to Q3 or year-over-year) and breaks down revenue changes into categories like new logos, upsells, down-sells, and churn.
In a down market, the logo count is especially important. Even if the average deal size is smaller, growing your customer base provides future opportunities for growth and upsells when the market recovers. While in the past, companies might have offered services for free to retain customers during tough times, today’s technology, like subscription management platforms, allows for more flexible packaging and pricing. This means you can offer smaller, more manageable packages or adjust existing ones without the high costs associated with managing on-premise software.
Mapping the Customer Journey for Future Growth
Understanding your customer profiles and their journey is essential. Don’t just tell a story about how a customer progresses; translate it into financial terms. For example, if you sell to a hospital, show how their initial purchase might lead to larger contracts or adjacent service purchases over time. By mapping new customers to these potential journeys, you can project their future revenue impact over two to three years. As a CRO, you need to look beyond the current quarter and understand how the customers you bring in today will contribute to revenue in the coming years. This long-term perspective is crucial, especially in a scaling business.
Churn and Retention: The Stars of the Show
During a recession, churn and retention become incredibly important. Unlike older on-premise software, SaaS businesses have access to detailed customer usage data. This allows you to identify customers who might be at risk of churning, often during implementation or renewal periods. You can proactively address these risks months or even a year in advance. Presenting this data to your board, along with your plan to mitigate churn, is vital. Your board members, with their extensive networks, can often help by making introductions or offering advice, especially for key accounts. Highlighting your retention strategies and how the board can assist demonstrates your proactive approach and builds confidence.
The Power of a "So What" Slide Title
This might seem small, but it makes a huge difference: make your slide titles clearly state the main takeaway – the "so what." Instead of a generic title like "Sales KPIs," use a title that tells the board what they should understand from that slide, such as "New Logo Growth Slows, But Upsell Momentum Continues." If you don’t know the "so what" of a slide, you need to redo it. This forces clarity and ensures your message is easily digestible. This practice not only helps with board presentations but also sharpens your overall strategic thinking and communication skills.
Bonus Tip: Ask for Help!
In times of stress, people naturally want to help loved ones. Your board members are no different. Find constructive ways to ask for their help. They have vast networks and experience that can be invaluable. By asking for assistance, you make them feel like active participants in overcoming challenges, which strengthens their engagement and support for your strategies.
Growing Your CRO Talent
If you’re a new CRO or CEO and feel you lack the experience or resources, there are ways to grow. In the past, the advice was often to hire the most experienced person available. However, in today’s market, with slightly slower growth rates, there’s more opportunity to develop existing talent. If someone has functional experience but needs to grow into an executive role, you can coach them. Consider hiring an experienced fractional CRO to coach your internal team or bring in a strong number two, like a revenue operations expert, to support the executive. The key is that the person you’re developing must be motivated to grow and utilize external resources. If they lack fundamental CRO skills, that’s a more immediate concern that needs addressing, as teaching both executive skills and functional expertise simultaneously can be challenging.