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What is Revenue Operations? A Guide to RevOps

Table of Contents

In the early days of any business, the founders and early employees have their eyes on everything but overlook RevOps. They are wearing a hundred different hats and so coordinating efforts is not a challenge. If the company is operating as it should, everyone is pulling in the same direction and has a common focus in mind.

When the business grows however, the structure inevitably has to expand to break out the business functions into separate teams that can take advantage of specific expertise and work on different parts of the customer journey. These silos are necessary in most cases, but they come with their own set of challenges. Revenue Operations (or RevOps) was developed as a solution to some of the problems that come with a company’s structure fragmenting. 

What is Revenue Operations?

At its simplest, RevOps is an organizational function that oversees all the operational teams that are client facing and/or are revenue generating units. This could include sales, marketing, customer success and a variety of other teams. The goal is to unify these functions and create shared tools, data and processes so that they can work better together.

The RevOps function typically sits outside of the teams themselves, at a birds-eye level – reporting directly to the executives and responsible for revenue generation at a business level. A recent study from Forrester suggested that of the organizations in the study that had a centralized RevOps function, 46% reported to a ‘Chief Revenue Officer’, 24% to a ‘Chief Operating Officer’, with the balance reporting to other executives.  

What Does Revenue Operations Do?

RevOps aims to consolidate the processes, platforms, systems and data that are used by the teams under their purview in order to eliminate duplication, improve efficiencies and align incentives wherever possible. This work can be achieved in a myriad of ways depending on how the business is structured and how well the teams are currently coordinating, but in every case – the goal is to take a holistic view at the whole customer journey and to optimize everything in that funnel to improve revenue generation.

Why Companies Should Have Revenue Operations

RevOps has proven very powerful for the companies that have implemented it because it fixes some key problems that can trip up the revenue generation on a company-wide level:

  • Disparate missions.  When siloed teams are all running in parallel, they will have different ideas of what ‘success’ means depending on the type of role they are performing, the performance incentives put in place by management and the status they have in the organization. When these missions are not aligned with one another, you risk sub-optimal decisions to be made that look good from the perspective of one particular team but are actually poor decisions at a company level.  RevOps can be a great failsafe to oversee these missions and work on alignment when needed.
  • Disconnected customer service experiences.  In the modern world, there are a vast array of customer touch-points across online and offline channels – and the expectation from customers is that the experience will be consistent, reliable and timely across all of them – without losing individual customer context. If operational teams are not coordinating well and are utilizing different systems or tools – then it’s likely that the customer journey can fragment and lead to overall dissatisfaction.  RevOps provides an invaluable holistic view of the customer journey and can drive the consolidation of systems, tools and data that is needed to compete in 2022 and beyond. These touch-points are make or break for any business and it’s crucial that you are showing a united front in all respects.
  • Disjointed Analytics.  Data is everything, truly. As companies are waking up to this fact, it’s apparent in so many cases that there is no one consolidated data warehouse from which operational teams are pulling information. Instead, this data often lives in multiple different places in different formats, which means that it cannot be used to its full potential. RevOps can be the catalyst for bringing that data together and unlocking the value of wide-scale standardization and common system usage. This can (and should) become a key business differentiator and is a much better way to make decisions about revenue – when you’ve got the whole picture and not just pieces of it.

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Revenue Operations vs Sales Operations

A common response that RevOps believers will hear from skeptics is that they already have Sales Ops – a very common function that purports to do the same thing – so there’s nothing new here. What they miss is that RevOps can often be the logical next evolution of that role as the company grows. Here are some comparisons to show you how to think about the difference between revenue operations and sales operations.

Revenue OperationsSales Operations
Looking at sales, marketing and customer success from a holistic point of view.Only focused on sales.
Performance measured by overall revenue generation.Performance measured by sales performance alone.
Mostly removed from day-to-day operations, providing strategic advisory and implementation.Direct involvement with day-to-day sales operations.
Incentivised to use the best tools for the organization as a whole, encouraging greater information and data sharing across functions.Incentivised to use the best tools and systems for the salespeople, regardless of what value is being left on the table for other functions.
Can analyse company-wide data and make recommendations on overall customer lifetime value.Only can advise based on sales data which might not show the whole picture as to the customer’s journey.

Another way to think about why revenue operations is, in fact, a different function entirely is to look at it through the lens of the various metrics under its gamut. Here are some examples of metrics that the RevOps function would be responsible for at a high level:

  1. Customer Lifetime Value
  2. Customer Churn Rate
  3. Length of Sales Cycle
  4. Sales Pipeline
  5. Forecasted Sales v Actual Sales
  6. Recurring Customers v Once-Off Customers
  7. Cost of Acquisition
  8. Customer Complaints / Refunds

These go well beyond the scope of what Sales Ops would look at and provides a much more comprehensive view as to the overall revenue generation of a company. It’s the next evolution in organizational structure.

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What is a Revenue Operations Manager?

So then, what is a revenue operations manager exactly? It is one of the fastest growing sales job titles on LinkedIn, but there is no standard job description because every company will be different depending on the structure, the industry, the size and a wide array of other factors – but here are some examples of what a revenue operations manager should be looking after:

  • Consolidating customer data across functions to arrive at a holistic view.
  • Identifying operational inefficiencies and taking steps to improve them.
  • Measuring and reporting on overall revenue generation.
  • Making strategic recommendations for the medium and long-term regarding revenue generation.
  • Aligning the missions and performance incentives of different operational teams for the greater good of the organization.
  • Managing key relationships across teams to encourage further coordination and collaboration.
  • Align technology, systems and processes to assist with central data collection and to avoid unnecessary duplication.
  • Keep a finger on the pulse of macro-trends in the industry and the target customer base.
  • And so on…

The potential here is vast and so it requires some careful thought and deliberation from those at the top to determine the sorts of objectives that are most pressing and then let the role evolve from there. When done correctly, a good revenue operations manager can be a tremendous force for good in an organization. 

RevOps Framework

RevOps cannot work effectively if there isn’t a carefully thought-out framework in place that demarcates the responsibilities of such a function – so that it can be held accountable and so that other functions have a clear understanding of why it exists.  

A good RevOps function should be constructed according to these four pillars:

PillarsKey Objectives
ProcessesIdentify and align key metrics across the organization. Remove friction wherever possible by eliminating duplication and inefficiencies. Document company-wide processes and customer journeys in order to identify potential obstacles/inefficiencies and to create an internal knowledge base that assists with onboarding new personnel and forming strategic planning.
PlatformConsolidate and define owners of each piece of the technology stack on which the company operates. Ensure that the best possible tools are being used at each level, standardizing wherever possible. Lead the technical solution design for integrating the overall technology stack – moving away from siloes.
PeopleManage the key relationships for effective change management. Build credibility and trust between teams through transparent communication and reporting. Provide valuable insights to management as to how their teams are operating on the ground.
DataWork towards building a consolidated data warehouse where all data can be combined and analysed effectively. Report on holistic customer data to identify trends, patterns and potential problems that should inform longer-term strategic decisions. Track the macro data from the industry as a whole in order to identify new revenue generation opportunities in advance. Manage overall data quality and access.

How to Integrate Revenue Operations?

It should come as no surprise that the integration of the RevOps function into a business is quite a challenge – especially if it’s a new concept for those in the teams that will be affected. As such, an integration plan is an important step so that it can be a value-adding function as early as possible – which will put aside any initial skepticism.

  1. Educate all the stakeholders about why RevOps is valuable and how it’s going to make their lives easier and improve their results over the long-term.
  2. Ensure that you have full buy-in from all decision makers, so that you are confident that you will receive the assistance you require.
  3. Perform a full process/system walkthrough with each of the operational teams to document the current state of operations and gather as much insight as you can about how each team operates.
  4. During the walkthrough process, build relationships with key stakeholders so that you assure them that you’re there to help them – not to compete with them.
  5. Spend some time learning about every tool in the technology stack to understand why it’s used and how various personnel make use of it.
  6. Gather the information collected during this process and look for quick wins which can prove the concept of RevOps and tackle any inefficiencies that are low-hanging fruit.
  7. Communicate your findings transparently with all stakeholders and seek input on potential solutions so as to encourage collaboration and interdisciplinary communication.
  8. Craft an action plan for the RevOps function that is customized for the unique circumstances and operations of the business – identifying priorities, objectives and metrics that will be the foundation for the function going forward.

Revenue Operations Software

When it comes to implementing RevOps into your organization there is an embarrassment of riches in the form of software – all of which can assist with various pieces of the puzzle.  But it’s crucially important that any new additions or changes to the technology stack is carefully considered because the choice of tools often dictate how processes and systems will be built down the line.  

Every company is different and is going to have different use cases that need to be factored into this decision making. This is the essence of RevOps – identifying the tools that will best fit the long-term strategic vision of the company and then encouraging the key stakeholders to use those tools in a way that benefits everybody, and not just their specific team.  

Here are some examples of larger technology platforms that can be customized and adapted for the purposes of effective RevOps:

  1. Salesforce

Salesforce is the elephant in the room here because its scale and feature set means that it can be your one source of truth when it comes to understanding your customers. When used effectively, it can be tremendously powerful and can integrate with almost all sales and marketing tools to pull data into one place. Any stakeholder can then dig in and get the insights that they are looking for.

The downsides of this sort of tool are that because its feature set is so wide – it can feel bulky and potentially overwhelming. If the data isn’t collected and maintained carefully, things can feel out of control very quickly and this sometimes leads to employees not utilizing the tool at all.

2. Chili Piper

Chili Piper is a lead routing tool that serves as the backbone of an automated meeting system that gathers key insights about leads when they are interacting with your website and then intelligently organizes them and sends them through to sales and marketing in whatever way you configure it to do so. Their suite of analytics and reporting can be a crucial source of information for RevOps to evaluate how things are going and make procedural changes as needed.

3. MixPanel

MixPanel provides visualization tools in order to better understand the data flowing through your funnel. If the systems are working correctly together, the dashboards created by this tool can be an invaluable ally in identifying trends and patterns and acting on them timelessly. A business is only as strong as its data and so it’s worth spending time and resources to get this piece right. This is especially true in the world of RevOps where you are still likely to have to educate and persuade various stakeholders about the value of this new function.

4. HubSpot

HubSpot is a full-service marketing and sales tool that can centralize many of the processes within the RevOps framework. It is highly regarded and serves as the lifeblood for many of the largest companies in the world. When used efficiently it can become the one-stop-shop for personnel across all the operational teams – gathering data holistically which can then be effectively utilized by RevOps itself.  As with most tools, this is only as good as the data which is inputted into the system, but it can be a game changer for some organizations who currently are not coordinating effectively.

5. ZenDesk

When it comes to customer success, it’s a crucial component to have powerful customer service software to manage the various inbound and outbound communication, regardless of what channel it comes through. ZenDesk is the market leader in this and empowers employees to look after customers without having to pull at straws regarding their context.  Using software like this centralizes the customer success function so that insights can be gleaned and fed to the sales and marketing teams – to tackle problems before they actually arrive. This is where RevOps shines – when it can take this data and use it to make strategic decisions upstream that lessen the load on those dealing with customer concerns and problems.

If your organization is at the size where operational teams are siloed and potentially working at odds with one another, then it’s recommended that you consider RevOps as soon as possible. As with all structural decisions, the earlier you can anticipate bottlenecks and eliminate them – the more efficient you’ll be. RevOps is more than just a sales buzzword.  It’s a new philosophy on how to organize your business in the modern world so you can provide a completely seamless experience for your customer while maximizing their lifetime value and the revenue they generate as a result. Don’t hesitate on this. The early bird catches the worm.

If you’ve got RevOps handled and need help with sales management, sales development, or inside sales, check out our fractional sales management guide and inside sales guide, or outsourced sales development guide.

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