Much like the entrepreneurs on the TV show “Shark Tank”, it takes determination and knowledge of a project champion to convince an executive leadership team to sink their teeth into a WMS investment.
Have you ever watched the show “Shark Tank”? For anyone who hasn’t seen it, the premise is basically this: A panel of investors (aka “Sharks”) decide whether to invest in hopeful entrepreneurs who make business presentations around their product or company. Think “American Idol,” but for great business ideas. When the Sharks hear a pitch they like, they’re ready to invest using their own money (sometimes they’ll even fight each other or partner to secure the business deal). But first, the entrepreneur must convince a Shark to invest the full amount they’re requesting to start, grow or save their business. No matter how mouthwatering an idea sounds on the surface, the investors will try to poke holes and find flaws or weaknesses in the entrepreneurs’ valuation of their company, product, or business model. To get one of the Sharks to buy in (or bite, if you will), entrepreneurs must develop a plausible ROI assessment and defend it following their proposition.
If you’ve ever been involved in a warehouse technology selection process, the format of “Shark Tank” should ring a bell. Not only does embarking on such a journey require a strong project champion, but it’s also critical to invite an enthusiastic C-level executive to sponsor the project. On “Shark Tank,” entrepreneurs accomplish this by answering the one question every investor wants to know: How am I going to make money on this deal? Like entrepreneurs, project champions must have the passion, knowledge, and charisma to sell executive leadership teams on the equivalent: How a warehouse management system investment will grow profits through improved inventory control, material handling efficiency, and shipping accuracy.
Effectively promoting the value of a WMS investment is most often achieved by a project champion who can deliver clear, concise and, most importantly, compelling, answers to questions executives will likely ask. For the uninitiated, Kevin O’Leary (aka “Mr. Wonderful”) is a veteran Shark, and arguably the show’s toughest tycoon. His #1 tip for a standout pitch is this:
“Each pitch must tell a story about money: the lack of it, the need for it and how it can be made. As a born marketer and salesman, I tell my employees all the time: if you cannot tell the story and put your prospective customer into the narrative of our financial products, you will fail. Good TV is no different from good storytelling…Oh and you better be able to get your story out in less than 90 seconds, or you can pack your bags because my money’s already looking somewhere else.”
With Mr. Wonderful’s advice in mind, and continuing with a WMS investment as an example, let’s explore some likely questions a project champion should prepare for to ensure they make the right splash in the “Shark Tank.”
How is the selected product different from other alternatives in the market? What is unique about it?
This question comes up during every episode of “Shark Tank.” Project leads should bank on hearing it during any WMS investment pitch as well, only it will sound more along the lines of something like, “of all the WMS offerings out there, why is this specific solution from that particular vendor the absolute best fit and worthy of an investment for our company?” The marketplace for warehouse management systems is feature and function rich, but not all features and functions will carry the same weight in the mind of every distribution executive.
Today’s companies are increasingly moving toward investments in these solutions due to greater understanding, among users and executives alike, that it makes more sense to deploy the best specialized software solution for certain functions while ensuring it’s well integrated with existing or planned ERP systems and other software or material handling extensions to the WMS. Project champions must tailor their arguments for the product they’ve identified to the specific needs of their type of business (a retail vs. a wholesale distributor, for example) and articulate how those capabilities will deliver better value for the money than competing WMS offerings.
How does your product or service add value?
If a given distributor’s business could benefit from efficiency gains and the project champion can identify areas where they exist, that individual should also be able to explain why the company can expect a solid WMS return. To better understand how executives perceive WMS options and how they impact ROI, it’s best for project champions to position the purchase of the WMS they’re pitching as an imperative business process change. It’s easier to transition into positive ROI territory if the WMS can identify and solve order errors, wasted labor, workflow issues, and other bad practices. That said – and while it’s true that any and every lasting change made to increase efficiency provides a compounding, positive return – it’s important to keep in mind that what owners and C-level executives care about most is how the investment will help increase revenue, acquire more customers, reduce costs, etc.
Focusing too much on practical, day-to-day process changes and workflow adjustments during an executive presentation can quickly start to get too into the weeds. Emphasize key value-related points at a high level but be sure to draw a clear and concise line to how each will ultimately improve the business’s bottom line. To do this effectively, provide an evidence-based case on why a WMS isn’t just a one-off investment, but rather it’s provided by a long-term partner – one that will not only impact and enrich a wide range of processes and habits in your warehouse, but also support company growth for years to come.
How will this help with projected sales?
An excellent benefit to emphasize in the answer to this question is customer service. Going hand-in-hand with order accuracy, customer service is closely tied to a distributor’s ROI on a WMS investment. WMS solutions help to ensure orders are delivered accurately and on-time, and many systems also support automated alerts to notify customers in real time when their purchases have processed and shipped, where those orders are in transit, and when they are expected to arrive at their final destination. Keeping customers happy through continued satisfaction is a terrific way to establish trust and earn loyalty. When you’re in good standing with your customers, it demonstrates strong retention rates (which leads to more sales).
When it comes to ROI calculation and cost-benefit analysis, the project champion pitching the investment needs to have their numbers down. That said, unless they’re a finance practitioner or analyzing the merits of a capital project is part of their job, this requirement is going to be a tall order for any warehouse or operations manager who might typically lead such an implementation project and executive presentation. Mr. Wonderful offers this pitch advice:
“Know your numbers. And if you aren’t good with numbers, bring someone who is!”
What’s the downside?
While this may not be the final question posed by the executive leadership team, it’s definitely one they’re going to want answered upfront – and absolutely before any ‘i’s are dotted or ‘t’s are crossed on a WMS agreement. Project champions must be direct and transparent in their pitch, which shouldn’t be too daunting given the amount of research and vetting they’ve already done to select a specific WMS and vendor and bring it to the table in the first place. This is an opportunity to show executives the homework has been done, and no party is making any attempts to “cheat an A” on the assignment.
In a WMS pitch, the presenter’s mission is to reveal the vision for operational excellence to their executive leadership team. They need to make sure they’re translating every component and potential impact of the proposed solution in terms that matter most to the company’s executives. At its core, ROI is a performance measure used to indicate the value of an investment by focusing on the efficiency or monetary benefits the business stands to gain. The key to getting buy-in lies in the WMS investment project champion’s ability to convince executives that it’s going to pay significant dividends.
Or, in terms of success for all my fellow “Shark Tank” fans out there, the equivalent of hearing Mr. Wonderful say a single, simple phrase: “For that reason, I’m in!”
This contributed article first appeared in Food Logistics on October 27, 2021. To access the publication, click here.