What are your own company's cash flows and EBITDA?
How many of you have discussed either cash conversion cycles or information from proxy statements on sales calls?
Are you able to articulate to a hiring manager the direct impacts their own department has on the company's overall goals for the upcoming or current year?
If you're ever considering joining the C-Suite, you'd better start learning about your company in financial terms.
If you want a leg up over your competition, you might want to consider including some financial language in your next sales call.
And finally, if you're going for a job and you're up against a few people, try uncovering more than just website or social media information to stand out in your next interview.
I get it, financial terminology may seem very intimidating (and possibly boring) but when you can show that you understand your own business (and your client's business), it goes a long way in building trust. Here are three ways to make an impact whether you want to become the next C-level, are on sales call, or interviewing for that next job.
One word to note- much of this information relates to PUBLIC companies, so if you are in a scenario where you are meeting with/working in a private company, find a similar public company to get general ideas about the industry as a whole. Or, see if there is information available internally!
1) For those Aspiring to Go Higher
If you are looking to move up into the VP ranks or higher, you really should have some idea of how your company or organization is performing financially. Knowing this gives you instant credibility and respect. The best way to find this information quickly? Pull up your company's Financial Statements: Balance Sheet, Income Statement, and Statement of Cash Flows.
Your own company site will have this available under "Investor Relations" and you can view SEC filings by year (10-K) or quarter (10-Q). It's always a good idea to look at the most recent year/recent quarters to have an idea of how your
company is currently performing. Sales (Revenues) and EBITDA (Earnings Before Interest and Taxes, basically, the revenues related to actual production) of the company are a great place to start on these statements. You can also view this information in digestible formats at sites like Yahoo Finance or SeekingAlpha.
Secondly, take a moment to listen to your company's earnings calls. On the call (or recording), you can hear directly from your company's CFO and CEO about the direction and performance of the company. Analysts will also ask questions to gain better insight; and you'll be able to listen in and hear the responses.
Finally, check out the annual report published by the company - it's glossier and prettier than typical filings. This report will describe recent history and what's to come in formats a little easier to read.
2) For the Sales Folks
You may have your own routine for prepping for a sales call, but why not throw in a little financial information as well? The best scenario is to be able to use this info to connect the dots between your service or product, but if you can't do that, just knowing the information
can be helpful in building the relationship with a client or potential client.
One way to do this is to review the Proxy Statement. A proxy statement outlines how the C-level executives and Directors are compensated. They may receive a bonus for required activities and milestones for the year. Can your product or service help them to achieve their bonus goals?
Another option to analyze is the customer's cash conversion cycle. How long does it take from paying a supplier, holding inventory, and getting paid by their customers? There's a little math involved here, but it could be worth it. Is there something you/your product/service can do to help that cycle?
Lastly, if you have the time, follow everything recommended in #2- but for your prospect or customer instead.
3) For Interviewees
So you have an interview - congratulations! Perhaps there are a few people going for the role. Everyone is going to come in with their basic "research" on the company; i.e. the company website, social media, etc. Want to stand out a little more? Get into the financial statements! There are several line items you can view on the Income Statement like
Expenses or Revenues. Look for trends- are revenues growing or declining? This can be a question you ask during your interview. If they are growing, make sure you are aware of any big deals or developments mentioned in Press Releases or in social media. If the number is declining (and it's not Covid-related) ask about it.
The annual report will also list out goals for the company in the coming year. This is a great place to find the general direction of the company or even specific revenue targets. Take a look at areas where you can help the team directly impact figures.
Okay, feeling a little better? Take a little time to do the research, try out these out, and let us know how it goes!