Building a Sales Enablement Budget
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In order to bring meaningful value to the business, sales enablement needs meaningful investment from the organization. That’s why building and earning justification for the sales enablement budget is an essential skill for all sales enablement leaders.
Securing the resources necessary to carry out effective sales enablement initiatives is one of the key ways that practitioners can increase the value of sales enablement to the business. For example, the State of Sales Enablement Report 2019 found that those with formal approaches to sales enablement experience win rates that are 12% higher than those with informal sales enablement, demonstrating that informal sales enablement is simply ineffective at improving business performance. Yet, one of the most common reasons why companies have informal approaches to sales enablement is because they lack the resources necessary to carry out formal sales enablement initiatives.
“If you speak to a lot of enablement leaders around why they’re not more successful, they’ll say they have a wonderful strategy, but they don’t have enough sponsorship, resourcing or budget to really transform the organization,” said Cameron Tanner, sales enablement lead at Amazon Web Services. “If you’re not truly providing the amount of budget, sponsorship, and resourcing, it’s no surprise that the enablement leader can’t regulate or gets subpar results.”
Sales enablement is a field that has and continues to experience rapid growth. As the State of Sales Enablement Report 2019 found, 79% of companies have a sales enablement process in place or plan to in the fiscal year, representing 20% year-over-year growth. As sales enablement continues to become more established as a business function, it is increasingly important for companies to carve out a permanent place for it within their annual budgets.
Not only does a formal budget help practitioners organize and plan their programs to maximize ROI, but it also sets a framework to scale success as sales enablement grows in an organization. With the end of the year fast approaching, the time is now to begin building your sales enablement budget and securing the resources you need to be successful in the coming fiscal year.
Core Components of a Sales Enablement Budget
Every budget should include consideration of costs that are consistent, set in stone, or unavoidable, as well as forward-looking costs that might include things to anticipate with business growth, nice-to-have programs, or potential risks. It should also clearly communicate the business value that the company can expect from its investment in the sales enablement budget. Below are four core components that should serve as the foundation for a sales enablement budget.
- Fixed Costs: These are the business expenses that stay relatively consistent even as a business experiences changes. For example, they could include the salaries for the sales enablement team, must-have solutions and tools, cost per head for required trainings, and more. All things that are essential and mandatory for the practitioner’s day-to-day operations should be included as a fixed cost.
- Variable Costs: On the other hand, variable costs might fluctuate as needs transform in a business. Some things to consider and plan for in this section include travel and associated expenses, professional development courses, contract or consultant work, etc. Typically, these are more “nice-to-have” expenses that might not be make-or-break for the business, but would help increase sales enablement’s impact.
- Potential Risks/Unexpected Costs: In a fast-moving and nimble business function, rarely do things ever go exactly according to plan. Therefore, it is a beneficial exercise to think through the obstacles or changes that could arise and potentially impact your budget allocation. For example, perhaps an urgent need for a sales meeting arises and costs ensue to support the event. Make sure to include a little bit of padding in your budget ask to account for these types of risks or changes that can impact your actual spend.
- ROI/Measurement of Success: Clearly show what you anticipate the return to be on the company’s investment in your sales enablement budget. It is imperative to communicate why sales enablement deserves the resources requested as opposed to another function. Where possible, pull in historical data and research to delineate the potential return of each cost. For example, if your company runs an onboarding program every year, does sales rep competency correlate to an increase in core company KPIs like increased revenue? (Hint: the Sales Enablement Analytics 2019 report found that those that measure competency improvement experience a win rate that is six points higher than those that do not.)
Once a draft budget is created, sales enablement leaders need to build the business case for every aspect of the budget at the executive level to secure the support, funds, and resources necessary to maximize business impact.
How to Build the Business Case for your Budget
Many executive leaders are in the early stages of understanding the potential for sales enablement to drive tangible business impact. Because of that, most sales enablement budgets are not set in stone, meaning practitioners have the opportunity to define their needs.
Executive leaders need to see compelling proof for why investment in sales enablement is worthwhile — and it is the responsibility of the sales enablement leader to educate them on the value of granting the budget required for sales enablement to be successful. Here are four tips to build a rock-solid business case for your sales enablement budget.
Align to Stakeholder Executives Visions & Goals
Especially at organizations where leadership may not fully understand the value of sales enablement yet, it is essential to align all of your actions and budget requests to the top goals that the executive team has for the business.
“Be super clear about the problems you’re solving for and make sure that leadership is aligned both on the marketing side and on the sales side,” said Trevor Yeats, director of B2B marketing at Verizon Media.
Identify the core problems that are top priorities for each stakeholder and communicate how your initiatives will help alleviate those pains.
Use Data to Articulate the “Why”
When making any kind of investment — even beyond the world of business — people need to be convinced that it is worth the time, resources, and money that could be allocated elsewhere. Use data to tell a compelling story about the impact of the initiatives you have budgeted for, either from past initiatives, industry research, or small pilot projects.
“If you try to request resources without having data, if I was the CEO, I would shoot you down,” said Jen Spencer, VP of sales and marketing at SmartBug Media. “You’re asking me to deviate from what our normal process and our normal budget is, so I have to see compelling proof as to why this is going to be effective.”
Include Specific Examples of “How”
After reaching an agreement on what to tackle and why it is important, be sure to align on how you will get there, including details on program execution and the resources that will be used for each initiative. When leaders can see the steps you will take to reach an outcome, it is easier for them to make the connection between the initiative and the expected return.
“Go to the [executives] and say, ‘this is what you want, and this is what the Board wants, I can get you there, and I’m going to need these things to do that,’” said Tanner. “I think you’ll see [those organizations] achieve better results because the [executives] can be more connected to the transformation that you’re driving.”
Leverage Partners to Demonstrate Demand
Often, cross-functional partners such as sales operations, learning and development, and product marketing are working toward similar high-level goals as sales enablement. Work closely with those partners to determine how you can help each other with your initiatives and leverage those stories to illustrate the value of sales enablement.
“I established relationships with enough people in the company that at the drop of a hat, I could ask them for help, and they say, ‘yes, no problem, let’s go do it,’” said Patrick Merritt, director of worldwide field enablement at Sumo Logic. “Then when we do all these great things, [the executive leaders] can say, ‘Now we get it. We understand the value of sales enablement and we need to invest in it.’”
Building a budget is no small task. It needs to be developed with aspirational, innovative goals in mind, but also with enough research, evidence, and data to back up why it is worth the company’s investment.
However, the purpose of a solid budget framework cannot be overstated. When sales enablement has the budget it needs to fulfill its charter, it is poised to drive tangible business impact in the areas that need it most in the eyes of executive leaders. With a sales enablement budget built on the foundations of the four core components and a solid business case that hooks the attention of executive leaders, practitioners can elevate the impact of sales enablement in their organization.