The continuous advancement in customer experience (CX) has revolutionized the need for various departments in an organization to share information and collaborate to increase customer acquisition, retention, and sales, reduce customer churn rate and increase your customer base, which is where revenue operations come in.
In simple terms, revenue operations are the strategic process that brings various organizational departments together to improve customer satisfaction and measure customer success and departmental ROIs. Importantly, RevOps enables teams to make more informed business decisions.
In this blog, we have covered all your should know about Revenu operations – its definition, importance, key differences, revenue operations metrics, and how you can implement revenue operations strategy in your company.
Revenue Operations (RevOps) is a strategic process that integrates marketing, sales, customer success, finance, and service departments across the entire customer life cycle or funnels to provide a better end-to-end view to administration and management.
RevOps uses automation to help organizational teams to create product prices that increase conversion and margin, reduce revenue loss, use customer data to identify new revenue opportunities and make decisions that grow businesses. The critical business functions of RevOps are to increase communication between teams, increase access to data, create better data flow between departments and build a holistic approach to achieving organizational objectives.
Revenue Operations makes all teams accountable to revenue and allows them to focus on the customers and deliver value to the company. It is designed to break down silos between customer-facing areas and give companies an immense competitive advantage.
The critical difference between revenue and sales operations is that sales operations focus primarily on sales. In contrast, revenue operations focus on multiple functions, such as sales, marketing, customer success, and finance.
Sales operations center around facilitating sales teams’ functions to help them spend more time selling; revenue operations are about making the entire revenue-generating side of the business more effective at what they do. When a company incorporates revenue operations, the sales team can focus on sales while the RevOps team can perform the behind-the-scenes work of collecting and managing data.
Sales ops are responsible for supporting the operations of the sales team. Some of their tasks include sales recruitment, onboarding and training, communication and collaboration channels within the team, and contract lifecycle management. Overall, sales operations are essential to improve sales performance by managing sales enablement, sales data, and strategic planning responsibilities and helping them focus on selling.
Overall, revenue operations strategy helps to connect data from sales, marketing, and customer service departments to provide the business with a complete view of every customer at all customer journey points. It is about meeting revenue goals and providing positive customer experiences.
Here are the key benefits of revenue operations:
Revenue operations allow you to predict your business’s growth and confidently invest in new strategies and markets. Revenue Operations bring this predictability to your growth through accurate and consistent measurements.
All stakeholders will have a shared outlook on what’s important to the business and what’s necessary.
Revenue operations bring customer-facing departments together to ensure every campaign and customer initiative is thriving and significantly impacts the sales funnel from the start of the campaign.
A RevOps approach allows organizations to remove roadblocks and silos within departments, increase companywide efficiency and create better CX.
By aligning the activities of the sales, marketing, finance, and customer success teams to focus goals across the departments and get all groups on the same page endpoint, such as generating leads, closing deals, and expanding existing accounts.
Revenue operations are a technology enabler. It helps teams become more strategic with their technology.
The revenue operations department size and structure vary depending on the size and needs of your business. However, the standard team structure for most revenue operations includes the following:
Usually, a Director of Revenue Operations reports to the CRO. The following manager report to the Director of RevOps:
Remember that these managers might also have analysts who work in different areas to identify and solve issues relating to business performance.
Essentially, revenue operations teams responsibilities include the following:
Ideally, the Revenue Operations manager reports to the Chief Revenue Officer (CRO). The CRO manages and oversees the activities of the marketing, sales, and customer success management team.
Revenue operations is a collaborative, customer-centric strategy that increases sales and marketing effectiveness and helps organizational teams maximize the revenue potential of your business. The three key pillars of revenue operations include the following:
Revenue operations stimulate uniform processes as teams nurture and convert prospects. Key benefits of the process are a shorter sales cycle, improved retention, and a higher upsell volume.
This involves connecting and aligning the technology used in the organization to provide a clear and accurate story around the revenue pipeline, making it easier for people to identify how they, directly and indirectly, impact sales.
This identifies who is responsible for aligning and managing your revenue operations process and platforms. Also, depending on the company’s size, RevOps can create a specific team or share responsibilities among existing team members.
You need the following skills to excel in the world of revenue operations:
Ability to calculate: In RevOps, you must calculate and analyze everything based on data and metrics.
Strategic thinking: This involves your ability to develop plans and proposals based on the company’s goals.
Communication: You must be able to communicate and convince internal stakeholders that your strategies will make a difference in their long-term success.
Problem-solving: You must identify and remove problems that stop your sales team from generating the required revenue.
Teamwork and collaboration: Members of the RevOps team can’t work in isolation; they must be able to work and collaborate with other internal departments. The best RevOps teams work with managers and employees to implement changes.
Technically-minded: You must possess basic coding skills for complex software and systems.
Customer-focused: You must be able to relate to and manage customers well. Even if you don’t directly interact with customers, you must always have the customer’s needs at heart.
The revenue operations model aims to help teams increase revenue growth and customer lifetime value. Here are the critical revenue operations metrics that you should track:
Annual recurring revenue (ARR) is the total revenue remitted into your business from contracts or subscriptions and is calculated over a year.
Forecast accuracy refers to the calculation of how predictable your revenue is. It is usually expressed as a percentage.
Pipeline velocity refers to the speed at which leads move through each revenue pipeline stage.
Sales cycle time refers to the period from the first interaction with a prospect to the deal’s closing.
Win Rate refers to the proportion of sales opportunities converted into customers.
Customer lifetime value (CLV) refers to the amount of revenue expected from the customer during the entire business relationship.
Customer acquisition cost (CAC) is the total cost of winning a new customer. It includes salaries, marketing expenses, equipment, and so much more.
Upsells and renewals refer to the amount of revenue a company makes from selling new products to existing customers or convincing them to commit to a new contract or subscription
Customer churn is the total number of customers a company loses across a specific time.
CRM tools are the best tools for revenue operations. Before choosing any CRM tool, you must ensure that the tool has the following capabilities:
Activity and contact tracking: This helps you track where each prospect and customer is in their buyer’s journey.
AI-powered analytics and insights: These AI tools help you manage and manipulate large datasets.
Revenue analytics: This feature helps you gather information by monitoring workflows and reporting their strengths and weaknesses.
Revenue forecasting: This feature allows you to harness current and historical data to predict the expected revenue in the future.
Individual account dashboards ensure every lead and customer has their section within your CRM, with complete visibility for all revenue-generating departments.
Data aggregation from third parties: This feature enables your CRM tool to transfer data from other sales platforms to provide all your sales reps with the essential information they need at their fingertips.
Integration with third parties: The best practice with revenue operations is to be able to link your CRM tool to your marketing automation and sales enablement platforms.
Developing the best RevOps is not magic. You can implement it in your organization using the following tips:
This first step involves tracking down every data element that concerns revenue, such as product data, account data, quotes, orders, contracts, invoices, and payments. For this, you must include all data from upstream when you create the products to downstream when you recognize revenue in your ERP.
The next step is to combine all the different systems inside your ERP, such as forecasting, product catalog, contracts, incentives, orders, CPQ, billing, and other important ones. An excellent way to achieve this is by building connections between all different systems or, better still, bringing every system onto one platform, usually a CRM, and then integrating that CRM with your ERP.
To reduce your task’s redundancy, use automation tools to capture the required data and automatically send it to the next touchpoint. The less time your team spends on manual tasks, the more they sharpen their skill and focus on the right questions.
Revenue operations teams can use revenue data and other information about customer behavior to find new leads, create new opportunities, build models for the following best action and ultimately grow the business.
Revenue operations (RevOps) is the end-to-end strategic business process of driving predictable revenue across various organizational teams such as marketing, sales, customer success, finance, and systems teams. Creating a RevOps strategy enables teams to gain more visibility across the entire revenue team, drive revenue predictability, improve efficiency across the revenue process, and achieve revenue growth.
We have provided all the necessary information about revenue operations, how it can benefit your business, the team structure, CRM tool features, and steps to implement a revenue operations strategy in your organization.
Get started with Sloovi Outreach