4 Ways RevOps Can Help Build Certainty During Uncertain Times
It’s hard to think of another moment in time where we have had so much uncertainty about business continuity. The good news is, there’s a way to come out of this unique situation stronger. Startups that index towards efficiency and sustainability will not only have strong cash on hand, but they’ll also have the systems and processes in place to make decisions based on future go-to-market expectations.
We recently published the following Customer Assessment Model to help companies maintain growth in Q2 and beyond. In this post, we want to share another valuable strategy to drive business efficiency and sustainability. Enter Revenue Operations, or RevOps. With RevOps, companies create the flexibility they need in their revenue processes in order to adapt to ever-changing market conditions.
Companies are moving towards end-to-end RevOps because of its ability to combine sales, marketing and customer success. It’s an attractive approach for most companies. But before you make the leap, first understand how it’s different from the Sales Operations functions of the past. After all, they're both in charge of driving revenue.
So, what’s the difference?
At its very core, sales operations is about optimizing the sales funnel by closing more deals, faster and at a larger size. Sales operations is a great place to start, but RevOps takes us one step further by thinking more holistically about the revenue function.
In their early stages, companies often think about the immediate, short term goals of the business, such as initial customer acquisition at all costs. Doing that leads to a bloated cost of acquisition and a failure to consider the entire customer experience, which ultimately drives long-term revenue growth and retention--the lifeblood of a sustainable organization. Losing sight of the customer journey is a problem that can only be solved with marketing, sales and customer success teams working together. RevOps bridges these siloed activities, and as a result, helps drive revenue.
RevOps is more than a new function
RevOps is a movement that’s gaining traction--especially among B2B companies-- because it spans the entire customer lifecycle.
I reached out to Karan Singh, VP of Revenue Operations at Procore Technologies to get his perspectives on RevOps, and what he believes are the four ways businesses can apply RevOps principles in order to grow long-term revenue and reduce uncertainty. Here’s his take:
1. Create a connective tissue between sales, marketing and customer success
At most companies, sales, marketing and customer success teams work in silos. As we know, this leads to inefficiencies and unhappy customers. When sales teams are focused on closing as many deals as possible, while marketing is focused on generating leads, neither team has the tools or metrics to make decisions based on the long-term value of the customer. This results in lower customer retention and declining revenue growth over time.
For a company to be successful, marketing and sales need to align to business goals. If marketing and sales teams are focused on getting any customer through the door, they can miss out on catering to a particular kind of customer with a better chance of retention and value.The problem is that marketing and sales rarely agree on what an ideal customer looks like because incentives are rarely structured around customer fit--sales metrics, such as short-term quotas and deal size, don’t tend to work that way.
RevOps serves as the connective tissue between sales and other revenue functions-- bringing them all together. Companies that invest in RevOps can drive hierarchical change that strengthens collaboration around a core strategy. Driving that change starts with distinguishing roles and responsibilities. Sales focuses on the single function of pure selling, marketing oversees the factors that drive revenue and customer success is responsible for retaining and expanding revenue. RevOps encompasses all of these revenue-driving functions, and serves as a strategic overseer of core revenue teams, making it easy for stakeholders to engage with a single point person on the overall revenue process.
Here’s how to build the connective tissue:
- Establish Center of Excellence functions: In order to scale RevOps, companies should consider creating specialized sub-functions (COEs) that dictate strategy, systems, enablement and insights roadmaps for the overall revenue organization. These specialized functions interact with each other to build a cohesive roadmap for the revenue organization so that it can be successful.
- Have a single point of contact for those on the front line: In addition to your COEs, consider rolling out Field Operations. FieldOps is a team on RevOps responsible for interfacing with marketing, sales and customer success. They’re the dotted line between your stakeholders and the centers of excellence.
- Create a feedback loop to capture front line discovery: Pressure test your corporate strategy by having FieldOps gather information to build context and clarity. Stakeholders often try to implement new strategies without having front line input. Having a feedback loop avoids creating a vacuum, and ensures that there’s stronger adoption from your stakeholders when you roll out changes.
2. Align execution with business strategy
Organizations that treat operations as a service team and not as a strategic partner tend to lead by solutioning versus strategy. The approach can be problematic as a company grows. When existing problems aren’t addressed (as a result of failing to consider the full customer journey), issues are fixed with a band-aid approach--by using systems to solve for process issues that will break as the company scales. Businesses should align on business strategy first (i.e. ensure it’s clear what the long term goal is) and then focus on execution via systems and process, followed by technical solutioning and implementation.
RevOps is key to aligning execution to strategy. Because RevOps serves as the hyper-communicative collaboration engine for the organization, it can easily align roadmaps given it spans all areas of revenue, help support execution through programs and manage projects that ensure the business maintains its north star.
In addition, RevOps can measure against strategic objectives via pre-established KPIs. Being data-driven is one of the hallmarks of a strong and successful RevOps organization. By quantifying strategic initiatives, it’s much easier to get ahead of underlying problems. For example, RevOps can use customer success metrics to figure out which products are resonating with customers, or it can determine how much additional revenue is being brought in from each strategic initiative.
To combine process with tools, RevOps leaders can follow this roadmap:
- Build your process around project management and collaboration. Define your process and prioritization techniques that can do extensive discovery.
- Use a CRM tool to execute on the day-to-day. This shouldn’t be your be-all and end-all, but is an important component. Make sure to focus on the strategy piece and bring the ideas from your centers of excellence to life.
- Forecasting is the foundation for all strategies. Know your KPIs, where the business is trending and where there’s opportunity to expand. And avoid technical debt!
The net-net is that strong RevOps creates a better customer buying experience, which will deliver revenue, retention and loyalty that scales. The key is to have constant communication, shared metrics and a strong process that ultimately leads to a better customer experience.
3. Strengthen your RevOps muscle to manage change
Getting RevOps right can help your company position itself for ups and downs. We all know there’s great uncertainty in any business, especially in the current climate. Certain factors are out of our control, but you can control your process—and the ability to mitigate risk.
That’s why, companies should be proactive versus reactive to changing business conditions. To get started, first strengthen RevOps by having solid FieldOps in place. You want to build out that FieldOps function right around the $50 million run-rate to build the muscle memory from the start. FieldOps may not be hugely valuable from day one. The investment early on is about teaching and coaching stakeholders on how to work with operations.
Next, make sure that stakeholders aren’t approaching the centers of excellence with changes they want to see happen. For example, a SalesOps leader may say they need a new technology and then give instructions on how to implement it. The moment something like that starts happening, you no longer have subject matter experts driving decisions that only subject matter experts should make. FieldOps should provide feedback, pressure-test solutions and push back when necessary.
With discovery input from FieldOps, RevOps is able to deliver a prescriptive roadmap to get in front of issues—from the field to the boardroom. The process has to be data-driven and flexible. You can’t take a wait-and-see approach. And always make sure to measure and refine your strategy and process when necessary.
4. Give RevOps a seat at the leadership table
One of the most foundational things you can do to ensure your revenue organization will succeed is to give RevOps a seat at the leadership table. The RevOps team is key to prioritization, helping the business make informed decisions cross functionally. The only way RevOps will work effectively is if it’s able to have strong handoffs between groups and efficiency within the organization.
Unlike other departments, RevOps is focused on strategy and process--its also hyper-communicative and focused on bringing cross-functional teams under a single umbrella with shared metrics. This ensures that everyone is working towards delivering results for the company as a whole over the long-term.
The role of a sales operator, marketing operator and now revenue operator is probably one of the most strategic roles at every B2B software company.
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