Sales management

This Week’s Big Deal: Sales Operations, or Revenue Ops?

Revenue operations is the hot topic in B2B right now, with scores of media outlets and thought leaders turning their attention to the new State of Revenue Operations from LeanData and Sales Hacker.

Based on survey results from a poll of nearly 2,500 sales and marketer leaders, the report shows that companies with a dedicated revenue ops function rose from 20% in 2018 to 31% in 2019, and the number of organizations working toward such a setup also increased substantially.

(Source: Demand Gen Report)

What should we make of this information? Is building a RevOps engine a valuable undertaking for your business? What would this structural shift mean for sales operations? 

To answer these questions, let’s start with the basics and unpack a few insights from analysts and experts.

What is Revenue Operations?

SiriusDecisions offers up this definition for revenue operations, framing it as the holistic convergence of three critical customer-facing business units:

Revenue operations is made up of sales operations, marketing operations and customer success operations teams that work together in accordance with a set of operating principles that align planning, processes, technology, data and measurement that help organizations maximize revenue and performance.

We talk often about the urgency to improve sales and marketing alignment. Revenue ops is essentially the natural evolution of an alignment prerogative, embedding its principles across the organization. The shift is driven primarily by two factors:

  1. Heightened focus on the total customer experience, which is impacted by interactions with each of the departments mentioned above.

  2. Increasingly agnostic views on who is driving revenue so long as growth is on track and hitting targets (i.e., eliminating the competitive credit attribution divide between sales and marketing).

Last year, Forrester’s Megan Heuer cited study results showing “organizations that deployed revenue ops in some form grew revenue nearly three times faster than those that didn’t. Public companies with revenue ops also had 71% higher stock performance.” 

Fueled by this success, the revenue operations model is certainly gaining steam in the B2B space, though there are differing interpretations of the data. One Demand Gen Report headline notes that the latest research highlights rapid adoption of revenue operations models in B2B. Another at MediaPost, covering the same report, concludes that B2B firms are failing to integrate sales, marketing and customer success teams

Which one is right? Both, actually. RevOps is unquestionably on the rise, but still being adopted by fewer than one in three B2B organizations at present. Either way, it’s a trend that shouldn’t be ignored. 

But, what does it mean for sales leaders?

Sales Operations and Revenue Operations

First of all, there should be no thought of revenue operations replacing sales operations. Companies earn revenue by selling; it is a means to an end. Trying to reposition sales ops as revenue ops would be like saying, “Let’s go play a game of touchdown.”

So sales isn’t in danger of losing its seat at the table, and can absolutely retain autonomy in such a scenario, but it might require some give. It starts with loosening our grasp on the lead pipeline.

“A lead is not a sales asset,” argued Dana Thierren at last year’s SiriusDecisions Summit. “These are company assets, and everyone in the company should have visibility. Every single person wants an opportunity to make a difference.”

Sales teams should be welcoming support from their marketing and customer success peers when it comes to converting leads. The territorial instinct is outdated and counterproductive, frequently driven by misguided compensation systems. Last week, creating team-based incentives and awards was one of our suggestions for modernizing sales incentives programs, and it’s the kind of thing that could go a long way toward lowering collaborative resistance.

Let Data Drive RevOps

Even when an openness to the RevOps model is established, there are still barriers to making it a fruitful reality. Data tops that list.

“Data is the foundation for high-functioning revenue operations function,” said Kerry Cunningham in the aforementioned SiriusDecisions Summit keynote. “It must be consistent across the organization.” 

We wrote here earlier this month about methods for straightening out your sales data, but of course, this initiative goes beyond the sales department. Marketing and customer success typically have useful customer insights of their own, and combining all this information into one cohesive source is the springboard for a true customer-focused strategy.

Helpfully, David Crane recently shared some tips at CMSWire on data orchestration for B2B marketing and sales. Among his suggestions: approach the task with a holistic strategy, focus on process, and remember that no one type of data is a cure-all. 

All for One, One for All

Whether or not your organization is interested in joining the wave of those formally implementing a revenue operations model, the underlying principles – alignment and orchestration across all customer-facing business units – are worthy of embracing in virtually all B2B settings.

For B2B operations leaders, the future is fusion. 
 

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