As more business moves to subscription-based services, sales contracts are becoming increasingly complicated, especially in the software and hardware sectors. And with ASC 606 now in full effect for public and private companies, the contract approval process can be a stumbling block in closing deals, which can lead to lost revenue and disgruntled clients.
As a result, companies are setting up deal desks — groups of cross-functional stakeholders that include financial analysts — to streamline the review and approval of the custom contracts that sales teams are now crafting for their clients.
What impact do deal desks have on hiring for financial analysts and revenue accountants? What best practices can companies follow to set up and maintain effective, efficient deal desk operations?
To learn more, we spoke with Courtney Herrmann, an account manager for Aston Carter who places financial professionals in deal review positions.
Both Hard and Soft Skills Needed
Given the nontraditional nature of the new subscription contract model, it’s not surprising that the skills needed for deal review positions are different from standard analyst roles.
A background in finance is a must. Some clients, depending on their size, require heavy revenue experience if this person also determines how the revenue is recognized throughout the life of the contract. But that’s only a starting point.
“It’s important for the person in this position to be analytical,” continues Herrmann. “Are they going to be able to go through a complex contract and ensure the pricing structure, payment terms, penalties, maintenance, and potential discounts, renewal terms etc., are compliant with the company standard? It is a very manual process since each deal is very different.
Because the role is cross-functional, with finance working with representatives of the sales and legal teams, strong communication skills are a must. Herrmann adds that the ability to stand your ground helps, too.
“Successful analysts in deal desks are comfortable pushing back when they need to. Everyone wants their deal approved, and they want it fast,” she says. “Having the confidence and patience to provide feedback on what changes need to be made to ensure compliance and gain final approval is key.”
The specific responsibilities of the role can vary by organization, Hermann notes. For larger organizations, where the primary responsibility is to expedite deals, Herrmann looks for financial analysts. For full-cycle accounting, the search extends to revenue analysts and revenue accountants.
Narrowing the Gap Between Finance and Sales
The collaboration required by deal desks has led some companies to recast how they view the analyst role.
Finance positions traditionally are funded by finance and seen as pure overhead. But Herrmann now sees deal review positions increasingly being funded by the business unit.
“Finance managers are going to the sales leaders and saying, ‘If you want your people to hit their goals, we need another deal desk person in place to work with your team and support the volume.’"
Positioning the deal desk analyst as part of the sales team has another benefit: In most organizations, it’s easier to get approval for revenue-generating positions than for positions that add to back-office overhead.
Herrmann adds that, with the proliferation of software subscriptions, those approvals are easy to understand. “The amount of revenue in these deals is significant, especially at the enterprise level. Companies can’t afford a situation where the business units are doing a great job selling but the deals aren’t getting approved fast enough.”
The Advantage of Working with a Recruiting Partner
When it comes to staffing, companies with existing deal desk functions and those looking to set one up face similar challenges:
- How fast can qualified talent be identified and onboarded?
- How do you measure success?
- How can the function be adequately covered through fluctuating business cycles without adding unnecessary personnel costs?
One effective way to meet these challenges is to work with a recruiting partner with extensive experience in placing financial professionals in deal desk positions.
Aston Carter provides clients comprehensive support, from initial sourcing and screening to onboarding and ongoing performance reviews. It begins with recruiters who know who — and what — to look for.
“We look for people who have experience interfacing with sales organizations and can communicate clearly when we meet with them,” says Herrmann. “If they enjoy sitting at their computer and plugging in numbers all day, a deal desk role is not the ideal position for them.”
In both cases, the support extends throughout the contract.
“We understand the intricate steps that take place which include goaling for sales, auditing the contracts, determining how the revenue is recognizing and reporting on the end result. This allows us to find the right person depending on what functions are needed within one role. We do all of the sourcing and screening and set up the interviews,” Herrmann explains. “When a candidate is selected, we oversee the onboarding process and conduct performance reviews once a quarter.”
Herrmann adds that success metrics also vary by organization. Larger deals at the enterprise level may come at a lower volume but higher complexity.
Finally, using consultants gives companies the flexibility to handle fluctuating volume. With the option of contract-to-hire, the deal desk function can be built incrementally based on the business and company earnings.
What the Future Holds
Herrmann predicts that the growth of subscription services will only continue, adding to the need for companies to set up, or grow, the deal desk function.“ Technology and innovation aren’t going anywhere, and it's only going to get more complex. Look at the last 10 years and how things have changed. I can only imagine how much of this we're going to be seeing in another 10 years. We're living in a subscription era.”
If your business could benefit from consultation about how to meet your government contract staffing needs, contact Aston Carter now.
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