Catching a falling knife. That’s what CFOs like you are doing at B2B companies everywhere: attempting the seemingly impossible.


The Q4 horse trading is done; you’ve hammered out a budget. Now that Q1 is in full swing, conditions on the ground are changing.


Maybe the sales team is wildly surpassing revenue goals and looking to expand. Or maybe they are falling short of expectations. Meanwhile, marketing wants to launch a costly new campaign.


The long B2B sales cycle is complicating matters. New sales reps likely won’t produce results till Q3. The metrics suggest assumptions about Q4 are off. Yet the board is scouring the numbers and asking, “What’s going on here?”


Your job is to align revenue with expenses. You’re concerned about profitability. You want to be a good steward of capital. And your organizational patience is being pushed to the limits.


How should you reallocate your budget at times like this?


Let’s begin with a worst-case scenario. Then we’ll show you the right way to reallocate.


The Wrong Way: CFO, Sales, and Marketing in Constant Conflict

In this scenario, sales and marketing leaders view the CFO as a “cost cop.” Everyone is playing defense, so no one is winning.


Here’s where the team’s problems lie:


  • They haven’t established a hierarchy of goals. CFO, sales, and marketing operate in silos. There’s no agreed-upon framework for linking activities to outcomes. Budgetary demands reflect insular views.
  • They’re not using the right metrics. Leaders aren’t tracking all necessary indicators (behavioral, leading, and lagging). Maybe they’re not sure what to track. In either case, they don’t have reliable data.
  • They’re not communicating regularly. Marketing and sales leaders steer clear of the CFO. Without the benefit of their input, the CFO simply hands down decrees.


This kind of environment doesn’t allow for incremental budget changes. In fact, overcorrection is likely (e.g., a 20% reduction in the sales force). Culture-shocking moves like this only feed the negative cycle of mistrust and miscalculation.


The Right Way: Collaborative and Data Driven

In a B2B context, organizational patience is key. Without it, you can’t reallocate wisely. To achieve it, you and your sales and marketing leaders must work closely together.


Here’s what you can do to set the stage for success.


Actively engage sales and marketing leadership.

Convene the group weekly to break down walls, share data, and build rapport. Develop a team cadence. Demonstrate your support for sales and marketing. Make clear you’re not just counting dollars.


The steady flow of timely, accurate information will aid your decision making. So will the trust and goodwill of sales and marketing leadership.


Focus on the proper indicators.

These should be agreed upon at the start and tracked together over time. Only then will your team have an accurate picture.


  • Behavioral—You’ll want to track activities that correlate with financial performance. These could include number of prospect meetings, proposals submitted, etc.
  • Leading—These are more precise than behavioral. How many leads are being generated? How has the product mix changed? What’s the pipeline-to-quota ratio?
  • Lagging—These are the metrics that get the most attention (revenue per head, cost per head, average deal size, win rate). But you can’t focus on these alone. They won’t tell the whole story.


Don’t let anything trump the data.

Sales and marketing leaders must think and operate like business people. If they’re driven more by art than science, your budget woes will continue. They need be trained to operate in a responsible way.


Make the case to the CEO. Go higher, if necessary. Your budgetary sanity depends on it.


To learn more about how SBI helps CFOs budget wisely, read our budget analysis case study.


At SBI, we’ve perfected a methodology for aligning CFO, marketing, and sales. That’s because we live and breathe B2B. Subscribe to the SBI blog for the professional insights and resources you need.