Companies invest heavily in streamlining operational units (logistics, manufacturing, warehousing, etc.) to maximise profit, but is the same scrutiny applied to streamlining revenue operations?
With the advent of advanced technology for revenue-generating business streams, the opportunity to streamline and maximise profit is available. It can assist in solving problems and improve efficiencies and effectiveness within a business unit and across three direct revenue contributors.
What is Revenue Operations and Why is it Needed?
Revenue Operations (RevOps) is a function that provides a specialist focus on revenue-affecting business units, such as sales, marketing, and customer service. It is about breaking down silos and streamlining those functions to minimise profit leakage and maximise their performance.
These three areas are often seen as different business units, led by individual leaders with business goals that contribute in some way to the business strategy. They are areas with limited congruency with each other from a streamlining sense, creating chasms for profit leakage.
Sales are centralised around the CRM with limited systemisation outside of it, whereas marketing relies on project-based tools and relies on the CRM for contact data. Customer service relies on a combination of CRM and operation/finance software for order and customer management. Depending on the software system installed, there will be limited congruency in the software platforms.
But, when you bring sales, marketing, and customer service truly together through streamlining revenue operations, you drive revenue growth for a business and identify previously unseen profit chasms.
RevOps aims to bring these teams to work so that measurable improvements in efficiencies and effectiveness are transparent, along with profit improvements.
What Does Streamlining Revenue Operations Provide?
Streamlining revenue operations can assist in solving problems that hinder growth and impede success. Four go-to problems RevOps can solve are:
- Closing the gap between marketing and sales: Many companies experience a gap between marketing and sales departments with strained relationships and conflict. This particularly happens with companies where marketing is responsible for lead generation. Applying a RevOps function is about getting both departments on the same page regarding customer journeys, messaging and revenue goals. Considerable leakage of profit can be identified where these functions are poorly aligned. RevOps can lower the conflict and create a collaborative working group directly impacting the topline.
- Disorganised and misaligned business functions: It is not unusual for companies to face challenges in effectively managing critical functions such as lead and pipeline management and customer data management. These can lead to poor reporting and sales forecasting, hindering overall performance and impeding the achievement of growth objectives and business strategies. Streamlining revenue operations is a function that optimises these processes and removes barriers to growth.
- Inefficiencies in revenue channels: Identifying and addressing inefficiencies is imperative as it contributes to missed growth opportunities. The revenue operations function provides a holistic view of the revenue cycle, enabling the identification of areas for improvement and implementing solutions to improve efficiencies. By overcoming these inefficiencies, companies can unlock hindrances to their growth efforts and yield positive results.
- Seamless customer experience: As buyers drive the sales process with their access to technology and data when making decisions, aligning sales marketing and customer success teams and providing seamless communication for buyers and customers is imperative for growth.
How Does RevOps Work?
The demand for companies to more effectively coordinate their sales, marketing, and customer success initiatives has driven the growth of streamlining revenue operations. RevOps offers a clear path to success in the current competitive marketplace by aligning these key functions with a common methodology for driving revenue growth.
RevOps is fundamentally concerned with alignment. This encompasses establishing a well-defined business objective, developing coherent strategies across all departments to facilitate that objective, and optimising existing procedures to achieve superior outcomes.
For instance, in the realm of sales, alignment may entail the development of systems and procedures that prioritise the customer lifecycle over individual transactions. In marketing, alignment may entail the creation of customised campaigns and programmes that generate qualified leads that sales can conclude. In the context of customer success, alignment may entail delivering the highest quality service experience to each customer.
Revenue Operations Benefits
Your business can gain a competitive edge by effectively managing revenue operations through:
- Improved alignment
- Long-term strategic planning
- Increased customer retention
Consider the possibility of all members of your revenue-generating teams adhering to the same objectives, priorities, systems, and processes. They operate in unison without any misunderstandings and are capable of promptly devising the most effective resolution in the event of an issue.
In conclusion, your organisation will experience enhanced efficiency and cost savings. Your revenue growth will accelerate due to your team’s increased productivity and the acquisition of more satisfied customers.
Who is Recommended to Adopt the RevOps Function?
RevOps is a revenue optimisation function intended for organisations that aspire to enhance their sales and marketing effectiveness, enhance customer retention, or expand into new markets. Additionally, RevOps is intended to optimise business units and enhance the bottom line.
Revenue Operations vs Sales Operations
Sales operations, or Sales Ops, are intended to assist salespeople in performing their duties in an effective and efficient manner. It establishes structures, processes, best practices, and guidance to enable sales representatives to allocate more time to selling and less time to non-revenue-generating, labour-intensive tasks.
Revenue operations and sales operations departments are both responsible for generating revenue for an organisation. However, there are two significant distinctions between them:
- Sales Operations is exclusively concerned with activities related to sales representatives and is restricted to a single component of your overall revenue strategy. In contrast, RevOps pertains to the comprehensive assessment of business practices across all revenue-generating teams. RevOps may encompass Sales Ops, Marketing Ops, and Customer Success Ops.
- Sales Ops concentrates on CRM, training and development, territory planning, and deal administration. Whereas RevOps evaluates the entire customer journey from first touch through to engagement, revenue funnels, go-to-market execution, and customer experience.
Revenue operations and sales operations were previously interchangeable. However, RevOps has since developed into a distinct core function and is now essential for sustained revenue growth.
How Do You Implement Streamlining Revenue Operations?
Not all companies need a full-time revenue operations specialist. Before hiring, it is important to understand what you want to achieve and what level of involvement will be required from a revenue operations person. Is this a full-time role, part-time, contract or consulting service?
The deciding factors are:
- The annual turnover of the company
- The functionality of marketing (PR, Branding, Lead Generation, Social Media)
- The sales channels operated by the business
- The customer churn rate
- The customer acquisition rate
You need to clearly understand what you want from revenue operations, if it is achievable, and present a sound business case.
For instance, you may observe a disconnect between your sales, marketing, and customer service personnel. Salespeople get inaccurate data and poor quality leads from marketers; customer information isn’t updated in real-time; workflows are misaligned or overlapped between marketing and customer support, etc.
Through a revenue operations review by expert consultants, you can understand the overall requirement and impact you can potentially gain by streamlining revenue operations.
Potential Issues When Implementing Revenue Operations
The effort necessary to thoroughly implement the function is well worth it; however, it can be complex. Unsurprisingly, this is the case, as it is contingent upon the complete support of the leadership of three business units and encompasses numerous intricate technical components.
Internal promotion to a green-fields role to take the lead on this new function can be met with resistance, like any change process. The function is not just about streamlining and efficiencies; it’s about changing and adjusting beliefs and habits, and some companies are challenged by change.
An external consultant often gets the push-through required in the early stages, allowing someone to step into the function that has gained cadence and acceptance.
Don’t presume you can simply duplicate and paste a new revenue operations function onto your company’s structure. In certain organisations, the distinction between sales and marketing is minimal to non-existent; however, these departments must be explicitly distinguished and distinct in a revenue operations-driven framework.
Exploring Streamlining Revenue Operations – What Comes Next?
The metrics and priorities required to implement RevOps can be established through a review process. It is a time to educate the team leaders and build their engagement during the review. The review establishes the reporting and disciplines required to deliver improvements and profit to the business and a platform for data-driven decisions. It considers the culture of the business and its adaptability to this new function.
In Summary
Streamlining Revenue Operations is not an instant result. It is an investment in business value and profitability that becomes a core function in ensuring marketing, sales and customer service alignment and optimisation. Like Lean and other operational principles, the investment is enduring to the company’s longevity.
Sales Focus Advisory is certified in Revenue Operations and Sales Enablement.
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