By Revenue operations (RevOps) is a strategic business function that strives to integrate sales, marketing, and customer success teams into one centralized component. It focuses on unified goals that enable businesses to become revenue-growing powerhouses.
As a business grows, engineering structures and systems that keep the company working towards the same goals become more complex and critical; hence, understanding and implementing Revenue Operations (RevOps) is crucial for staying ahead of the curve.
In this guide, we’ll discuss RevOps in detail, exploring its key benefits, essential metrics, and how to implement it.
How revenue operations work
Revenue operations have become popular as businesses strive to align their sales, marketing, and customer success initiatives better. RevOps paves the way for success in today's competitive economy by integrating these critical services around a shared aim of increasing revenue growth.
But how does RevOps actually operate?
In a nutshell, RevOps is about alignment. This includes establishing a clear corporate goal, developing aligned plans across all work functions to support that goal, and optimizing existing procedures to achieve better results.
For example, in sales, alignment could include creating processes and systems focusing on the customer lifecycle rather than individual transactions. In marketing, alignment could entail creating personalized campaigns and events to generate qualified leads that sales can close.
In the context of customer success, alignment may imply offering each customer the best possible service experience.
Pillars of RevOps
RevOps is built on three core pillars: Process, technology, and people. Businesses can create a unified revenue engine that drives sustainable growth by aligning these pillars.
Let’s discuss each briefly.
Process
You need to make sure you have the right processes in place to provide a consistent customer service experience throughout the customer journey. RevOps activates standard processes to promote accountability and trust within your company.
As your teams work together to convert prospects into customers, you will begin to see additional benefits, such as shorter sales cycles, improved retention, and a higher volume of upsells.
Technology and tools
Your tech stack is the foundation of your entire revenue operations. It connects your whole team and ensures strategy alignment, collaboration, and efficient processes.
You must connect and align your technology to provide a clear, accurate story around your revenue operations funnel.
By supplying a single source of truth, individuals can determine how they, directly and indirectly, impact the pipeline.
Furthermore, your tools should provide a 360-degree view of your customers. Keep this in mind when deciding which technologies to adopt and integrate to achieve your objectives and gain a complete picture of your customers.
People
The third and final pillar is the People in charge of bringing together and managing your processes and platforms.
Depending on an organization’s size, you should either create a specific RevOps team or split the responsibilities of RevOps among your current team members.
RevOps vs sales Ops vs marketing Ops vs finance Ops: What are the key differences?
While revenue, sales, marketing, and finance operations may sound the same, each plays a distinct role in driving revenue growth.
Let’s briefly explain each to understand the difference between them.
Sales Ops
Sales Ops supports your sales team by providing them with the tools and processes they need to sell effectively. SalesOps members typically focus on:
- Optimizing the sales process.
- Managing the sales pipeline.
- Improving sales productivity.
Marketing Ops
MarOps focuses on systems, data management, and processes that enable smooth marketing execution. It streamlines marketing activities, manages campaigns, and measures marketing performance.
Finance Ops
Finance Ops provides your finance team with the tools that help a business streamline its financial operations to achieve efficient growth. It is critical in driving financial accountability and accelerating business value with automation.
Revenue Ops
RevOps, on the other hand, differs from the other three in that it takes a more comprehensive approach. It encompasses sales and marketing operations, as well as other revenue-generating functions such as customer success.
As a result, revenue operations require close alignment across a variety of teams, including sales, marketing, legal, fulfillment, customer success, support, and more.
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Benefits of revenue operations for businesses
Now that you know how revenue operations work and the difference between revenue, sales, marketing, and finance operations, let's take a quick look at some of the benefits of revenue operations for businesses.
Predictable business growth
According to the RevOps Difference Report, 88% of companies with aligned teams met or exceeded their revenue generation goals, and 16% far exceeded these goals.
When departments share data, tools, tech, and open communication, businesses can take a unified approach to targeting each stage of the customer journey.
Since RevOps is a more synchronized process, teams can respond to market shifts more efficiently, leading to predictable growth even in unpredictable situations.
Consistent tech stacks
A tech stack is a set of tools and platforms for automating your job. With RevOps, different teams can use the same tech stack since they are united.
Since tech stacks are more fluid, everyone can refer to different platforms within their synchronous tech stacks. This streamlines the purchase, implementation, and management of varying tech stacks and their usage, cutting costs throughout the business.
Increased transparency
Often, different departments within an organization don’t communicate fluidly. Marketers may say one thing, while sales reps' outreach to customers may say something contradictory. This is not the case with RevOps.
With RevOps properly in place, everyone can be on the same page, and communication is consistent.
This improves the teamwork experience and positively impacts customer expectations.
Better customer retention
Revenue operations aren’t just about making a sale. It's also about retaining those customers you worked so hard for. Since customer success is involved throughout the RevOps process, customer success teams understand the customers better and can build rapport and trust with them.
This allows customers to stay with your product, which promotes sales and revenue.
Happier customers
When there are clear expectations, different departments of your organization can work harmoniously. When various departments work harmoniously, they are more attuned to a customer’s needs. This will undoubtedly satisfy customers because they feel their needs are heard throughout the company.
81% of customers are willing to pay more for better customer service. Revenue operations processes help ensure your customers are happy, which is a strong indicator of your customer success effort and impacts revenue streams.
Essential revenue operations metrics
Tracking the right metrics is critical for estimating the success of your RevOps strategy. Here are some key metrics to consider:
- Sales cycle time: The time it takes to move prospects through the pipeline to conversion.
- Win rate: The number of sales opportunities that are closed.
- Customer acquisition cost (CAC): The total cost of acquiring new customers.
- Pipeline velocity: The speed at which leads generated move across the pipeline.
- Customer lifetime value (CLV): The average value customers receive over the lifetime of their relationship with you.
- Churn rates: The number of customers leaving your business.
- Retention rates: How many customers are staying with your business.
- Monthly recurring revenue (MRR) and annual recurring revenue (ARR): How much recurring revenue to expect regularly.
- Number of active subscribers: The number of customers with active subscriptions (which is incredibly important for subscription business models).
- Customer satisfaction rates: This tells you how happy customers are. Some businesses only assess satisfaction after critical points in the customer journey, like onboarding, are achieved.
- Number of new leads generated: How many new prospects and leads have entered the pipeline in a given period.
Having the right tools in your tech stack can simplify this part of the job.
How to implement revenue operations
Implementing RevOps requires a strategic and systematic approach. Here’s an approach that has proven successful:
Step 1: Define goals and objectives
Like any effort, you’ll want to begin by identifying why you need a revenue operations division and what you expect to achieve. This step will help your leadership team and other stakeholders understand the risk of not implementing and aligning this new model throughout the organization.
An example of a goal could be that you’re looking to identify what factors contribute to driving predictable growth among a critical customer segment.
Then you may present a business case for how RevOps addresses this issue and how you intend to achieve this goal, such as removing data silos and creating closer alignment with sales, marketing, and customer success.
Leverage the SMART (specific, measurable, achievable, relevant, and time-bound) framework to make your goals and objectives more effective.
This framework will guarantee that your objectives are clear and attainable while addressing the concerns of leaders and critical stakeholders.
Step 2: Assess your current state
Conduct an assessment of your commercial team, customer journey, tools, and data management processes. Identify misalignments, inefficiencies, and gaps.
This exercise will give you a framework for setting up your revenue operations team and a baseline for monitoring the impact of your RevOps initiatives.
Step 3: Establish the RevOps function
Your RevOps function or team will be structured differently based on the size of your business, the complexity of your sales operations, and the products or services you offer.
Larger firms typically have a more matrixed RevOps team structure comprised of highly specialized positions with a singular focus aligned to the specific demands of the company and RevOps function.
In a larger organization, you’ll typically find a Director of Revenue who reports to the Chief Revenue Officer and has a direct line to the CEO.
From there, managers across the commercial team report to the Director of Revenue Operations, who has additional roles supporting the RevOps function, such as System Analysts, Process Managers, Sales Enablement Specialists, and others.
In contrast, the team structure in a smaller organization is much leaner and more generalized. It’s usually comprised of a team of one, with a RevOps Lead or a Revenue Operations Manager reporting to the CEO.
Under this model, the RevOps lead typically works with operations generalists across the commercial team and must be flexible and adaptable with a broad skill set to address evolving needs.
Also, understand that no two days are alike. On some days, the RevOps leads can focus on sales enablement; on other days, they can clean up data and manage ongoing projects.
Step 4: Standardise and optimize processes
Interdepartmental visibility is critical in the RevOps concept. It enables your team to make data-driven decisions, find growth opportunities, and forecast and plan more effectively.
However, before you consider using technology to achieve closer alignment and streamline important procedures, you must first establish a structure for how your go-to-market teams will collaborate.
This includes mapping the client journey, defining critical activities, and ensuring processes are harmonized and streamlined across the commercial team.
This also includes developing lead scoring and qualification criteria and adopting a new sales approach or playbook.
In any case, the idea is for everyone to work together as a team.
Step 5: Build your tech infrastructure
With step four complete, you can evaluate your current tech stack to see what technology you need to support your new structure. Pinpoint any gaps or opportunities for improvement or consolidation.
Remember, revenue operations aim to gain a holistic view of your customers, so it’s vital to monitor which platforms will enable you to consolidate your data in one place.
Some necessary tools and capabilities to consider to support your RevOps function include:
- Customer Relationship Management (CRM) Systems
- Marketing Automation Platforms (MA)
- Content Management Systems (CMS)
- Sales Enablement Platforms
- Reporting and Data Analytics Tools
- Attribution Modeling
- Personalization Capabilities
Peddle's team of RevOps experts can guide you through the entire tech stack selection process. We can assist you in appraising your existing tools, identifying gaps, and recommending solutions that align with your specific business objectives.
Schedule a free assessment today to explore how we can help you build a robust RevOps tech stack that fuels sustainable growth.
Step 6: Establish key performance indicators (KPIs)
Your RevOps program’s primary purpose is to promote revenue growth. Establishing RevOps KPIs will allow you to quantify and measure the performance of your revenue operations while maintaining team alignment.
As you collaborate with your commercial team to create workflows and processes, ensure you agree on the metrics to track.
Not all metrics are made equal, and each will provide a unique set of insights, so choose the ones that are most relevant to your business goals and strategy.
Step 7: Document data management and analytics best practices
A comprehensive data management plan is an essential part of any RevOps function. Document your best practices for data collection, cleansing, storage, and analysis.
Having a single source of client data will allow your revenue-generating teams to work more rapidly and agilely while driving continuous improvement in marketing, sales, and customer success operations.
Step 8: Monitor, iterate, and share Results
Review data continuously to monitor and improve the organization’s growth trajectory. Identify opportunities for advancement and iterate on your processes, tools, and data management practices.
Then, communicate the findings and observations with your team to foster a culture of transparency and accountability while encouraging continuous learning, innovation, and adaptation.
Challenges in implementing RevOps
Challenges are expected, especially if your company isn’t used to working in a cross-functional, data-driven way.
Here are some common challenges that RevOps teams typically face:
Lack of executive buy-in
Implementing a RevOps strategy requires support from your company’s senior leaders. Without executive buy-in, getting the necessary resources and support to make meaningful changes can be tricky.
To solve this challenge:
Provide the C-suite with a roadmap of your planned changes. Your roadmap should include:
- Each step in your plan with anticipated completion dates.
- A fully-costed budget for your plan.
- A list of expected benefits/results.
- A list of potential blockers/challenges and how you could resolve them.
- A glossary of business terms (don’t assume everyone in your org speaks the RevOps language!).
Resistance to change
Implementing a RevOps strategy involves changes to processes, technology, and culture. A shift in processes, roles, and infrastructure can spark fear in some team members.
To solve this challenge:
- Inform your colleagues of the positive benefits/outcomes of your planned changes.
- Commit to ongoing training for your teams.
- Leveraging change management best practices can prove fruitful in facilitating a smooth transition.
Inadequate technology and data management
Inadequate tech infrastructure leads to poor RevOps outcomes. The right tech infrastructure greatly improves the effectiveness of your RevOps program.
To solve this challenge:
- Audit your current tech stack to set yourself up for success.
- Map your customer journey and cross-compare it with your tech audit to identify gaps and tools you need to run operations successfully.
The key here is to focus on gaining a 360-degree view of your customer in one place.
Siloed data
Sales, marketing, and customer success teams often use different systems and data sources, making it difficult to get a complete view of the team and customer behavior.
To solve this challenge: Invest in a good CRM that all teams can access. In addition, ensure your CRM data is up-to-date.
Lack of clarity in roles and responsibilities
With RevOps, redefining roles and responsibilities or creating new ones is bound to happen. However, this can cause confusion if not properly communicated to your go-to-market teams.
To solve this challenge:
- Reduce confusion by documenting your RevOps structure and clearly defining roles and responsibilities.
- Share the new approach with team members one-on-one.
- Hold regular training sessions and workshops as needed.
Insufficient resources and expertise
Revenue operations need resources, including personnel, technology, and training, to work well. Not every business has the expertise or the cash to invest in these areas, which can slow down your RevOps strategy.
To solve this challenge: If you’re working at a startup or scaleup, start small, make incremental changes, prove the value of RevOps, and then request extra resources.
Engage external experts or consultants like Peddle to help you quickly build your RevOps programs.
Best practices for implementing RevOps
To successfully implement RevOps, businesses should focus on the following best practices.
Start with a clear strategy
Before implementing RevOps, it’s vital to develop a clear strategy that outlines your goals, objectives, and approach.
This should include:
- The customer journey across sales, marketing, and customer success.
- Internal processes and technology.
- Each team’s key metrics and KPIs.
Invest in an integrated technology stack
Tech is a crucial component of RevOps; the right tech can make all the difference between a successful strategy and a failed one. Evaluate and invest in an integrated technology stack that supports end-to-end revenue operations.
Choose platforms and tools that facilitate seamless data integration, automation, and collaboration across marketing, sales, and customer success functions.
A centralized Customer Relationship Management (CRM) system is often a core component of the tech stack.
Implement agile processes and iterative improvement
Your RevOps strategy will only succeed if all your teams adopt agile methodologies and iterative improvement processes. Continuously review and optimize processes, workflows, and strategies based on data-driven insights and feedback loops.
Encourage experimentation and innovation to drive continuous revenue growth.
Establish cross-functional teams
Revenue operations must work to break down the silos between departments; one of its key missions is to unify sales, marketing, and customer success into one revenue team, sharing common goals.
To this end, encourage collaboration and cross-functional communication between your teams. Align efforts towards common revenue goals.
Foster a culture of transparency and shared accountability to drive collective success.
Focus on talent development
Invest in talent development initiatives to empower team members with the skills and knowledge needed to thrive in a cross-functional RevOps environment.
Provide training, coaching, and opportunities for skill development to foster expertise in marketing, sales, and customer success domains.
Foster a customer-centric culture
Finally, RevOps requires a focus on the customer experience. It’s vital to foster a customer-centric culture where all teams prioritize delivering a seamless and positive experience for their prospects and buyers.
Unlock your business's full potential with RevOps
RevOps is not just a buzzword; it’s a strategic imperative for companies looking to thrive in today’s market. RevOps empowers businesses to unlock their full potential and achieve sustainable growth by aligning sales, marketing, and customer success efforts.
One thing to remember, though, is that since RevOps is data-driven, it will only ever be as effective as the data you’re using.
Because of this, it’s imperative to invest in tools specifically designed to enable you to handle data to the maximum level possible. These tools should integrate with your CRM system, organize and optimize your email, and guide your selling based on analytics.
Ready to take your business to the next level? Get a free assessment with Peddle today and explore how we can guide you through the entire RevOps implementation process, from strategy development to ongoing optimization.