By now, we’ve all heard about Revenue Operations (or Rev-Ops).
We’ve heard that it may be the panacea for our sales and business woes. It’s the secret sauce for super-powered sales. It’s the strategy that’ll turn a floundering team into a lean, mean, revenue-generating machine!
Or… it could be the latest in a long line of sales-y business fads with catchy names that help sell webinars and keep consultants in demand.
As a business leader, you want to know if Revenue Operations can help. You need to separate the truth from the propaganda. Are there practical and profitable ideas buried in the theories? Are there actionable items mixed in the hype.
The Real Story of Revenue Operations
In truth, Rev-Ops is not a new idea. It’s an old idea that’s been tweaked, given a facelift and empowered with new technology.
Revenue Operations is an internal business function that aligns sales, marketing and customer service processes and operations. Through alignment, transparency and execution, the business can drive predictable revenue across the customer lifecycle.
Alignment is an old idea in business operations. In the past, companies focused on alignment between segments of the business, like sales and marketing. With Rev-Ops, alignment focuses on the prospect/customer lifecycle.
Your prospects and customers are the source of revenue for your business, and with greater visibility you can better craft their experience. With better control of processes, you can eliminate inefficiency, and increase and improve your results. With alignment in the customer-facing segments of the business, you can better serve the customer and unlock more revenue-generating opportunities both internally and externally.
The Rise of Rev-Ops
Revenue Operations didn’t appear suddenly. It was a natural response to market and customer changes.
Today, prospects and customers are doing more research before talking to sales. They are more informed, and are looking at reviews, asking their colleagues and gathering information. The customer comes into the sale with expectations. They want a personalized experience. They expect the company to understand their needs and provide a solution. For the modern customer, a sale doesn’t stop with the invoice. Successful sales don’t rely on a great product or service alone. It’s also about providing a delightful customer experience.
To succeed, businesses need to adapt. More and more companies are adapting using a Rev-Ops strategy. A disjointed handoff from marketing to sales, or a poor experience with customer service, can lead a customer to find a different solution provider. Every lost customer is lost revenue. Every great experience is an opportunity for additional sales.
The Goal of Rev-Ops
The Revenue Operations strategy and goals will vary depending on the organization, business objectives, industry and customers, but at its core it’s focused on creating end-to-end strategic business processes. Revenue Operations seeks to centralize processes to better manage the customer lifecycle.
With the right processes, consistently delighting happens with ease and the business operates more efficiently. In turn, this increases revenue by reducing costs, more consistently winning opportunities and unlocking more opportunities.
With better management, you can identify potential problems and eliminate the deficiencies you may have (but not realize) with the customer experience. The end goal for Rev-Ops isn’t modifying a single point or interaction with the customer, but the entire lifecycle and the business processes that shape the prospect and customer experience.
With better transparency across the organization, teams work better. With visibility across the entire customer cycle, you can optimize revenue streams. The company can see where there are opportunities for improvement. You can target the specific problems and inefficiencies that can result in lost revenue, and then implement solutions that work.
With alignment of the business’s revenue-drivers (marketing, sales and customer service), the company is better able to scale and grow. The inefficiencies that hold the company back can be more easily addressed.
Does Revenue Operations Work?
While it’s still early, and many companies are still working to develop Rev-Ops functions, the results have been promising.
Between 2018 and 2019, there was an increase of 80% in the number of companies adopting a Revenue Operations role or team. After adopting Rev-Ops, companies in some industries are seeing sales increases as much as 10% to 20%. This has been accompanied by increases in sales productivity. Customer satisfaction (and retention) also increased, with another study showing an increase as much as 20%.
Again, while Rev-Ops has been a process, results are promising.
For the companies adopting Rev-Ops, the start is often simple. Rather than hiring new employees or struggling to find the right mix of skills and experience, current employees from the key areas (sales, marketing and customer service) can be shifted to the Revenue Operations initiative.
KPIs and metrics to measure Revenue Operations success can be identified. For example, many companies will task Rev-Ops to:
- Reduce the sales cycle.
- Increase sales win rate.
- Reduce the cost of customer acquisition.
- Increase renewals and recurring revenue.
- Identify opportunities for upselling.
Select a single key metric to focus on as a first step. Let the team review the process and target the challenges that are keeping the company from meeting their goals.
Over time, additional processes can be addressed.
If you have questions about Rev-Ops, or want to discuss the options and resources available for your company to get started, then contact GO2 Partners today. We’re happy to help.