If you’re new (or new-ish) to revenue operations, be not afraid. We come in peace.
In this post, we’ll shed some light on what is fast becoming the way B2B SaaS companies operate, in a world where go-to-market teams (marketing, sales & customer success) are strategically aligned in working towards a common goal: revenue. In a legacy ops model, operations teams are siloed, and governed by their respective departments. This means that instead of prioritizing the work that will most impact revenue, they defer to the specific priorities of the heads of marketing, sales, and customer success, respectively.
This not only causes unnecessary internal friction, but also an overall lack of efficacy. In the simplest of terms, revenue operations is methodology for operating a business, merging your marketing, sales, and customer success operations into one strategic team. The function of this new team is to be the driving force behind strategy, tools, enablement, and insights in order to align the goal of revenue impact with day-to-day execution company-wide. Your RevOps team will be the ones building the operational roadmap that will drive growth based on your company’s big picture KPIs. (We refer to these as 3VC: Volume, Velocity, Value, and Conversion.)
In order to accomplish this, they will analyze your company’s pipeline to see where you are underperforming, then prioritize and execute initiatives to close those gaps. A solid, well-functioning revenue operations team can be broken down into four core skills: Strategy, Tools, Enablement, and Insights. It’s possible there will be people who play a role in more than one function within these pillars, but you should ideally have an even spread. While many traditionally siloed ops teams may say they can do (or are doing) this, the reality is that it’s often happening at a departmental level, as opposed to a macro level.
The logic behind revenue operations is actually pretty straightforward: When individual teams within your company are siloed, they’re all working towards their own separate goals, instead of measuring their successes against metrics that impact the growth of the company as a whole. For SaaS companies, these metrics include Annual Recurring Revenue (ARR)/MonthlyRecurring Revenue (MRR), LTV and CAC.
The value of revenue operations is that it drastically improves the experience you’re able to provide to your customers. Useful data throughout the customer lifecycle can be easily shared between teams and used to help personalize the journey and generate better pipeline, as opposed to a legacy model, wherein data silos would prevent the efficient flow of information between teams. For example, revenue operations makes it possible for the sales team to identify prospective customers that bear close resemblance to existing low churn, high value customers and use these metrics to grow faster and establish a higher quality customer base.
In reality, many companies may already be utilizing at least a form of this strategy, albeit unknowingly. This is because it’s very difficult for any high-growth company to succeed without it, and taking a holistic approach to internal problem solving is really the only way forward. The bottom line? Siloing (though common practice in days gone by) inhibits growth, which can be a kiss of death for a SaaS company. As it has become more widely adopted, revenue operations has sometimes been confused with DevOps, which is a function that focuses on the operational layer of a company’s product and streamlines developers’ ability to make fast changes. Revenue operations, on the other hand, is focused on the operational layer of the go-to-market side of a business, and is driven by revenue impact.
So, is this truly the new gold standard for doing business, and not just a fleeting trend? That’s always the million-dollar question when any Next Big Thing rolls into town which, let’s be honest, feels like it happens all the time. For us, the real indication of the staying power of revenue operations is the fact that many SaaS and PaaS companies have already gone all-in with revenue operations and found plenty of reasons to never look back. This is because, when you have a strategically-aligned go-to-market team, the need for handoffs between departments is eliminated and problems that create a bottleneck are less likely to arise.
Once you’ve accepted the hard truth, which is that your company’s continued growth depends on its willingness to step away from the status quo of legacy operations, you’ll see why revenue operations is here to stay.