The revenue operations part of companies has become increasingly popular, and that’s for a reason. In short, RevOps allows you to achieve strategic alignment through all of the revenue-driving parts of your business.
The revenue operations’ goal is to ensure that marketing, sales, customer success, finance, and operations all work together and strengthen each other. Toni Hohlbein, CEO of GrowBlocks, has vast experience in RevOps, and has shared some valuable insights, which we’ve covered in this article.
The most important thing to remember about a revenue operations team is that they are not system admins. If you want to implement or roll out a CRM like Salesforce or HubSpot, you should hire a SysAdmin, not a RevOps person. Revenue operations are about ten times more than just being a systems admin, which also comes with a much higher cost.
However, that cost becomes justified as they’re needed to make your expensive CRO successful. Your CRO is responsible for many things, and a revenue operations team is the only one who, together with the CRO and CEO, thinks about the entire organization instead of only sales or marketing. Simplified, RevOps will:
Tell you when things aren’t going as planned and why that is.
Find opportunities and lay out how to capture them.
Forecast successfully, since they’re ahead of the business.
The Evolution of RevOps
There will be a point in your business where you outgrow your current systems and strategies. This is usually somewhere around the first millions of ARR, where many people are hired and ad spend becomes a key strategy. That’s when you need a CRM like HubSpot, and hiring a systems admin can be a great way to implement this successfully.
Further down the line, you will also need someone who truly understands the sales role and what’s needed for the salespeople to succeed. Here, a sales operations person is often hired and spends a lot of time working on the CRM. Later on, when the RevOps team grows, the sales operations hire becomes a part of a larger team.
After more growth and when you have multiple VPs of different departments, your RevOps should start emerging. The main role of revenue operations is to, together with the c-suite persons in charge, look at the entire organization and align interests correctly. Things like how marketing is impacting sales and vice versa are examples of what is typically targeted.
Mature organizations with proven strategies eventually start with so-called revenue execution, where QBRs and MBRs are completed and used to dive deep into the business. With these in place, you can think ahead about what needs to be done to hit your revenue targets. However, getting from having a RevOps team to prosperously planning your revenue is challenging but worth it once pulled off.
After assembling and working with QBRs and similar metrics for some time, you can also start planning your revenue. This is done by having your finance and revenue departments work together, where things like CAC are looked at to see what needs to be done. At this stage, your RevOps team can be used the most effectively.
Creating a Successful RevOps Team
Hiring a RevOps team is the first step to evolving your revenue streams. However, there needs to be a significant collaboration with all the VPs and c-level executives affected by revenue. That’s why something called a revenue engine needs to be created, which connects your entire funnel.
Once you understand the complete funnel, you can use it to see how all the different points of the customer journey impact each other, and what you can do to improve it. RevOps professionals are experts at creating and interpreting this funnel. The most common funnel in a simplified version consists of the following:
- Traffic is driven to your brand.
- Leads are gathered.
- Opportunities are located.
- A new customer is acquired.
- The CS team upsells the customer, or they churn.
- The customer base is created.
The Importance of Strategic RevOps
There are two fundamentally different ways for the RevOps team to operate, and one is significantly more valuable than the other. You want a strategic and revenue-driving approach rather than a tactical team-serving approach, so having this conversation is crucial for success. Here’s the difference between the two ways of RevOps:
- Fingers are pointed after targets are missed.
- Only finds where a specific number comes from and not why.
- May eliminate friction between departments and processes, but without understanding how that impacts the business.
- Supports sales, marketing, and CS.
- The finance department builds the revenue plan – looking at the business from the top.
- When falling behind, you focus on why and how to fix it.
- Use aligned KPIs, which lead to valuable QBRs or MBRs.
- Friction is utilized inside the company for growth by things like making the sales team and CS team interact throughout the process.
- Orchestrating sales, marketing, and CS, making them more successful together.
- The RevOps team builds the revenue plan with the revenue engine – looking at the business from the bottom.
- Revenue operations are about making all departments inside your company work together, creating a better customer experience and higher growth.
- There are many steps in building a RevOps team, and businesses at different levels need different people in place.
- Building a revenue engine where your entire funnel is looked upon is a great way to find misalignment within your organization.
- You want a strategic revenue operations team that thinks ahead and helps you solve problems instead of only pointing them out.