Persuasion Power: Creating the Logical Foundations of Your Argument

Over the next several posts, I will explain how to build your business case to achieve skyrocketing persuasion results.

Building your business case is a great way of doing due diligence and ensuring that your persuasion priority makes good sense for both you and others.

This requires two primary building blocks: logic and emotion. Have you ever heard this line before: “Logic makes you think, and emotion makes you act”? It’s true.

Let’s Be Logical

Logic has many components: deductive reasoning, inductive reasoning, abductive reasoning — just to mention a few. But this isn’t a philosophical exploration. In business, if you want to appeal to logic, you should do so with quantifiable measurements. That’s right, numbers.

Evaluation of numerical data is crucial when building a compelling business case. To be successful in business today, financial literacy is a must. You’ll never reach your persuasive potential if you are terrified of your calculator. You need to know how to read and understand the basics of an income statement, a cash flow statement and a balance sheet. You also should understand that, like the act of persuading, working with financial figures is an art form.

Breaking It Down

Let’s say you invested $100,000 in a marketing initiative that generated $1,000,000 in sales. Was your return a million dollars, or was it $900,000? Or maybe it was yet another number? The answer depends on who’s doing the math!

Non-financial types often have trouble grasping disciplines like accounting because — even though it’s an exact science — there exist so many gray areas. Financial options are open to interpretation, judgment and approximation.  (Incidentally, in the example above, sales and marketing people will claim an ROI of $1 million, while the chief financial officer will argue the ROI is $900,000.)

Seemingly simple ideas such as revenue (which in some organizations is called “sales revenue” or “gross revenue”) aren’t etched in stone. For example, when is that revenue “recognized” (an accounting term for “counted”)? Is it when the purchase order is signed, when the goods are delivered, when you invoice or when the money hits your company’s bank account? See? Vagaries open up multiple interpretations and different terms. Are we talking about gross profit or gross margin — both terms that describe the same idea?

Much like social and corporate culture norms, you must determine the accepted financial norms and adhere to them. More than likely, you won’t have sole responsibility to actually perform the calculations for your company (that’s what financial analysts are for), but you should have the financial literacy to know how numbers are generated and what they mean. When you do, you’ll be able to speak the language of finance, ask more insightful questions and use that information to create more compelling quantitative cases for your priorities.

As you build your quantitative case, consider as many positive aspects as you can: If your initiative could boost product market share in the Northeast by 8 percent, what might it do in other regions? Are there international implications you could include? And don’t forget multiplicity. If your idea would increase employee efficiency, thereby saving the company dollars, make sure you apply that savings to as many applicable people as appropriate. Are there tangential benefits? If you sell more of product A, will increased sales of product B follow?

Know this kind of stuff, and you’ll be well on your way to becoming a professional persuader.

Up next: Measuring return on investment.