When marketers start obsessing about something new, businesses have good reason to be skeptical. Not so with Revenue Operations.
RevOps is not a trend. I would call it an evolution of smart business practices, brought on by the changing needs of the customer and new tech capabilities among their providers.
As automation and CRM tools are increasingly shared across internal divisions, we have new opportunities to work out the kinks in the revenue pipeline.
Revenue Operations (RevOps) is a business strategy that optimizes revenue by aligning marketing, sales, and service functions, improving operational efficiency, and holding team members accountable to goals.
Some legacy companies might interpret RevOps to mean winning new business at any cost while obsessively reducing expenses. Nothing could be further from the truth.
Will your company maximize revenue by lying to prospects to get the sale, only to have them fire you shortly after? Will you grow the business by keeping employee wages stagnant, opening the door for competitors to recruit your best talent?
Of course not.
Instead, revenue operations aligns business culture, processes, and technology across all departments with the goal of maximizing revenue. This involves multiple aspects of running a business:
· Improving lead generation and qualification
· Connecting data points to highlight inefficiencies and monitor solutions
· Removing friction in the customer experience
· Using technology to reduce manual tasks and keep teams aligned
Companies are adopting RevOps because of a growing awareness that teams working in silos don't reach their goals as easily.
Marketing, Sales, and Service are sharing more tools and processes than ever before. Even though each department has a unique role to play, their responsibilities do not begin and end at any point in the customer journey.
Despite these developments, it takes real effort and focus to keep teams from lapsing into silos where communication and productivity challenges persist. Whether you have two employees or 200,000 – every company struggles with keeping teams aligned.
Here are a few signs your company could benefit from a renewed focus on Revenue Operations:
I’ve come to believe that most processes should always be in a state of improvement. If your company’s SOPs are ironclad, chances are good they will need updating as technology, roles, and goals change.
What is your average Lifetime Customer Value (LCV), and what would it mean to your business if your team could extend it a little longer? Replacing clients is expensive. Finding and addressing problem areas where you are losing customers can make a huge impact on revenue.
Referring back to challenge number one, it’s difficult to optimize processes when you don’t have good data to measure them by. If you have overlapping connection points, or no data at all, you are missing out on valuable insights that show where to focus your efforts.
The primary goal is to make revenue projections more accurate and predictable, so it’s important to define metrics that measure all aspects of sales:
· Sales projection accuracy
· Lead source and deal source
· Percentage of closed won opportunities
· Customer retention rate or churn rate
· Number of upsells and cross-sells
· Length of time from first connection to closed won (Sales Cycle)
· Average number of “touches” before a sales is confirmed
· Average customer lifetime value
· Number of opportunities in the sales pipeline
· Percentage of sales that match your Ideal Customer Profile (ICP)
As the data comes in, your Ops team will have a clearer picture of where teams are succeeding and where they need the most work.
"All teams should have access to the same customer insights, collaborate with a vision toward the same goals, and champion a seamless experience for the customer."
How you begin your organization’s journey with RevOps will depend on the size of your company and the resources you have available.
Smaller companies will likely have one operations person or team that oversees all aspects of prospect and client interactions, making sure outcomes line up with organizational goals.
Larger companies may have additional personnel to manage specific areas like sales and marketing operations, customer experience management, and cross-departmental collaboration.
Regardless of your resources, the best way to start building a revenue operations strategy is by documenting every process, tool, data connection, and employee that impacts your revenue goals (if you haven’t already).
Getting all of these factors aligned is critical to achieving your goals, so if you don’t have it all written down – now is the time. You need a complete picture of your company’s revenue operations before you start exploring ways to measure, test, and optimize it.
The next step will be to analyze every point in the buyer’s journey with your company.
Look at every interaction with the customer from first touch to the day they part ways with your company. Identify the teams, tools, and processes involved, and highlight points of friction that frustrate the customer.
One example might be the “hand off” between Sales and Operations.
Most of us have been in a situation where we establish trust and faith in a salesperson, only to see it end when the dotted line is signed. Then, we find ourselves passed off to someone on the delivery side who seems to know nothing about us.
Misfires like this can extinguish enthusiasm and increase churn, a problem solved by aligning data and processes between Sales and Operations. All teams should have access to the same customer insights, collaborate with a vision toward the same goals, and champion a seamless experience for the customer. When these pieces are in place, churn goes down and retention goes up – another positive step for RevOps.
Like all organizational changes, revenue operations is not always easy. Sometimes, things are rough. People will disagree about new processes. Marketing and Sales may still behave like cats and dogs at times. You may even have to discard someone's favorite app to improve your tech stack.
These are all growing pains though. As long as they lead to real growth, the long term benefits will far outweigh any temporary challenges you face. Count on it.
Mar 24, 2022 7:31:40 PM