How To Get Started With a Successful RevOps Framework
Updated: Dec 28, 2022
Developing Your Revenue Operations Strategy
What is RevOps?
RevOps (short for Revenue Operations) is a business function with the end goal of maximizing an organization's revenue potential by bringing all parts of the business together.
To achieve this, a RevOps team will need to focus on driving predictable revenue across marketing, sales, renewals, and expansion by delivering visibility and improving efficiency across the revenue process.
What Does RevOps Do?
RevOps develops systems, processes, and dashboards that drive accountability for all Go-To-Market (GTM) teams and aligns them to the same objective of creating revenue.
They’ll take care of permissions and system updates, evaluate, purchase, and integrate tech with existing systems, as well as the ongoing administration of these tools. RevOps optimizes your tech stack to make sure your GTM teams are efficient and can put as much focus as possible on driving revenue growth.
Implementing tools and setting up dashboards is only part of a revenue operations team’s responsibilities. They’re the glue that keeps Sales, Marketing, and Service teams all on the same page.
What are the Benefits of RevOps and Why is it Important?
In the past, sales, marketing, and customer success teams would typically rely on separate tech stacks and systems that would cause disconnects in data and differentiating views on what success looks like for their team. They’d each create their own reports and gather data points that wouldn’t necessarily be valuable to the other teams which would waste time and make it difficult to come up with informed and accurate decisions. These problems are further intensified when attempting to scale the teams and integrate GTM systems.
Once installing a RevOps framework you’ll start to see these benefits amplified across all departments:
Growth in Revenue
Because of the efficiencies that RevOps will implement, each rep will be able to generate more revenue, without additional resources.
In a research study performed by the Carabiner Group, out of the 69 companies that participated, 100% of the organizations with a centralized RevOps team had a 30% or greater ARR growth rate.
More Predictable Business Growth
Being able to predict growth is critical. It will make investing in new strategies and new markets much easier and you can do so with more confidence. You will also be able to tell what methods are working and when to pivot.
Faster Response to Changes in the Market
As your business grows, you’ll need to make big changes. Whether you’re transitioning to a new CRM or introducing and launching new products, you’ll still need to support your team. RevOps provides communication, training and project management, making internal changes easier, and helping to reduce the risk of losing deals and wasting time as markets change.
To summarize, RevOps will bring your revenue teams closer together and focus on the same goal. Instead of finger-pointing, inaccurate forecasts, wasted time, and a lone-wolf mentality, you’ll see better transparency and execution, data-driven collaboration, predictable business growth, and faster sales cycles.
How do you Structure a RevOps Team?
Now that you have a better understanding of why you should install a Revenue Operations framework in your organization, you should know how to structure your RevOps teams. A successful RevOps organization will revolve around four categories:
1. Strategy
2. Enablement
3. Insights
4. Systems
1. Strategy
Oftentimes, it can feel like your Marketing and Sales organizations are working against each other — communication is poor, handoffs result in weak leads, and instead of feedback, there’s finger-pointing.
A Head of Revenue Operations fixes confusing and competing processes with a focus on the bigger picture. It’s the RevOps team’s job to connect marketing and sales more efficiently, streamline finance processes, and discover potential pain points that can burden the entire customer lifecycle. They’re there to look for the money left on the table, whether through rethinking pricing, finding inefficiencies using data, or creating better processes.
2. Enablement
The RevOps team enables sales, marketing, and customer success teams to run more smoothly. They onboard and train on the tech stack, and offer coaching and professional development. RevOps leads project and change management by creating processes that encourage collaboration between sales, marketing, and customer success. Your GTM teams will be able to shift their focus from operations to revenue-generating activities enabling them to achieve their goals more efficiently.
3. Insights
Revenue Operations teams can measure and analyze your customer data to find inefficiencies across the funnel and solve persistent data issues to help identify, predict and reduce customer churn. They’ll set up ways to measure and analyze KPIs like forecast accuracy, cost of customer acquisition, and renewals and upsells. They can even use data to align all teams on a united strategy to drive revenue growth.
4. Systems
RevOps manages your tech stack and unifies data under one central location. Data management and access are essential to RevOps alignment. It’s their job to optimize your tech stack and handle permission and system updates of tools.
Unlike marketing or sales operations, RevOps is intentionally separated from the teams they serve. RevOps typically reports to senior leadership — a Chief Revenue Officer or Chief Operating Officer.
Anyone that’s a part of the product-to-cash lifecycle will work with RevOps in some capacity. While some departments will have to report to Revenue Operations, others, such as legal, will stay where they are, but with an added commitment to support revenue success.
When it comes to things that involve Salesforce development and technical implementation, most teams tend to look for outside help from a specialist. The RevOps Rangers are more than capable of handling any immediate and ongoing Salesforce related needs.
What are some of the functions of revenue operations?
According to SalesHacker, they include; Product Operations, Sales Operations, Digital/eCommerce Operations, Partner Operations, Quoting & Entitlements, Order Management & Fulfillment Provisioning, Billing Compensation Design & Strategy, Compensation Operations, Strategy & Process Enablement, SOX Compliance, and Process Design.
Some of the titles you’ll see are:
Chief Revenue Officer/CRO
VP/Director/Manager of RevOps/Biz Ops
Revenue Enablement
Salesforce/System Architect
Something to consider: Very few companies will hire RevOps as their first sales team hire. The majority of companies invest in a full-time RevOps person when they have a team of 6 sales reps or more.
What Are Critical RevOps Metrics?
The overall goal for Revenue Operations is driving predictable revenue. Sales teams need to close deals, marketing needs to grow pipeline, and Customer Success needs to retain revenue. Some of the key metrics and KPIs that Revenue Operations is accountable for include;
Time to close, Annual Recurring Revenue (ARR), Customer Acquisition Cost (CAC), win rates, forecast accuracy, pipeline velocity, renewals and upsells, customer churn, and Customer Lifetime Value (CLV).
To tell if your Revenue Operations team is succeeding, Salesforce says these are the most important metrics to look at:
Cost Per Acquisition: the cost to acquire a new customer
Annual Recurring Revenue: the money coming in every year for the life of a contract
Total Contract Value: how much a contract is worth
Churn Rate: how many customers stop doing business with you
Renewal Rate: how many customers renewed
Customer Lifetime Value: how much a customer is worth over their lifetime
Average Revenue per User: how much each active customer is worth
Days Sales Outstanding: how many days on average it takes to collect payment for a sale
Revenue Backlog: contracted revenue that hasn’t been recognized yet
Customer Adoption Rate: the number of new users compared to the total
CSAT: a customer satisfaction score that describes loyalty
Why You Need RevOps, Now?
Companies that invest in a quality RevOps function first will have a massive advantage. Some may hire a strong leader and qualified internal specialists, but if you don’t have the budget or bandwidth to build an internal RevOps function, a qualified outside provider like RevOps Rangers will help bridge the gap until you’re ready for a full team.
Additional Sources
https://www.clari.com/blog/the-rise-of-revenue-operations-infographic/
https://www.saleshacker.com/what-is-revops/
https://learn.marsdd.com/article/getting-started-with-revenue-operations-revops/
https://syncari.com/blog/articles/what-is-revops-guide-for-modern-business/
https://www.salesforce.com/resources/articles/what-is-revenue-operations/