Revenue Operations — RevOps for short — is a growing trend according to a new report “The State of Revenue Operations 2019.” Compared to 2018, the number of companies reporting a dedicated RevOps group increased from 20% to 31%.
What caught my eye was this statement from Rachael McBrearty, Chief Customer Officer at LeanData, one of the sponsors of the research.
Revenue Operations provides the go-to-market alignment required to deliver an end-to-end customer experience. It’s literally a game-changer for advancing customer experience in B2B.
I hope so. Because based on interviews I’ve been conducing recently, most B2B marketing and sales organizations are not on board with Customer Experience (CX) thinking.
Oh sure, most everyone claims that CX is (or will be soon!) a differentiator. And this study was no different — 95% agreed that CX is becoming a critical differentiator and revenue driver.
Knowing and doing are two different things. I’m sure 95% will also agree that a good diet and exercise are critical to good health. But how many are actually putting down that bag of chips and going for a jog?
Anyway, after a discussion with McBrearty and input from a number of B2B marketing and sales experts, I have to agree that RevOps could be helpful to advance B2B revenue growth and (maybe) CX adoption. Let’s dig deeper to understand why.
What is Revenue Operations?
RevOps is a relatively new term for tech-supported sales/marketing alignment — with the addition of newish Customer Success organizations. Here’s one of the better definitions I found on Quora (emphasis mine):
Revenue Operations (RevOps) is the alignment of sales, marketing and customer success operations across the full customer life cycle to drive growth through operational efficiency and keep all teams accountable to revenue.
The RevOps study found 78% agreed that “consistent revenue growth is a challenge for my organization.” Imagine you’re the CEO of a B2B company. You invest $X million in sales and marketing resources and currently get $Y revenue. Wouldn’t it be great if you get more revenue out of that investment? RevOps, simply put, is potentially a way to unlock that growth.
RevOps has its roots in another term — Revenue Performance Management or RPM — which I defined in my 2012 article as “a technology-enabled strategy to increase total revenue productivity.”
In 2014, Forrester proposed a revamped Selling System as “all activities that are performed by employees in your company to generate revenue,” which “cuts across organizational silos and is not limited to the sales organization.”
Perhaps RPM was before its time, and Forrester’s Selling System was overly broad. Everything can be considered revenue-generating, at least indirectly.
RevOps Interest and Adoption
Tech companies especially have been working to create more of an integrated team with direct responsibility for revenue and supporting that effort with a technology platform. “Revenue Operations” has become the rallying point for tech companies — they represented nearly two-thirds of the respondents in the aforementioned study.
You can also see a steady increase in interest based on Google searches the past 10 years.
Searches on “Revenue Operations”
I reached out to a number of B2B experts and got a mixed reaction to the prevalence of the RevOps term, although most everyone agreed that sales/marketing alignment was a problem worth solving. Here are their comments, edited for clarity and space.
The majority of Customer Success leaders most definitely take very seriously the need for close collaboration and shared access to data with their colleagues from both the Sales and Marketing teams. However, I would argue that particularly with the data, there are still very many companies that remain encumbered with siloed systems that do not easily allow for shared data. For at least some Sales and Marketing teams, there remains a culture that tends to keep “their” data within their team unless specifically required to do otherwise, as opposed to a culture that openly embraces the sharing of such data across multiple teams and looks for more opportunities to do so.
— Rick Adams, PracticalCSM.com
I’m seeing it, more often in larger companies than smaller ones, and more often in the tech sector rather than other industries. I think it’s an important and inevitable trend. This goes beyond “alignment” to create a single joined-up version of the truth when it comes to the factors that drive revenue and profit growth. It requires an analytic, data-driven approach to reporting and decision-making. RevOps helps organisations to answer “how does this contribute to revenue?” when deciding which initiatives to pursue.
— Bob Apollo, Inflexion-Point
Many of my clients have been working to better align and coordinate the activities of marketing and sales for the past several years. During the past year or so, I’ve discussed the revenue operations idea with several clients. Most were not aware of it, and most of those who were aware saw it as an “extension” of marketing-sales alignment to the customer success or customer service function. In my view, “revenue operations” is the latest label we are using to describe our efforts to retool business operations and processes in response to increased customer demands and reduced customer tolerance for inconsistent or disconnected experiences.
— David Dodd, Point Balance
We’ve been working with clients migrating to an integrated revenue operations model for awhile. Not everyone uses the phrase “revenue operations” but many companies are working to integrate sales, marketing, and even customer success operations together to increase efficiencies, lower costs, etc.
— Matt Heinz, Heinz Marketing
RevOps is the operations-level parallel to customer-level ‘marketing and sales (and CS) alignment’. I wouldn’t say it’s specifically a CDP function although the unified data also supports aligning marketing, sales, and CS. Many CDPs have additional features beyond the core function of data integration, so it’s plausible that they would have added some that specifically support RevOps. LeanData does lead routing and lead-to-account matching, which are good examples of those.
— David Raab, Raab Associates
We do a great deal of BtoB VoC research for European and US corporations. We have not encountered this term among our clients. Based on reading the white paper you sent, not sure what is new about this, other than a new packaging of existing prerequisites.
— Ernan Roman, ERDM
I am familiar with Revenue Operations but none of my clients are doing it at this time (at least not formally). To me, it basically takes the all-important sales and marketing alignment and adds customer support. This often (but not always) happens under the leadership of a CRO. I am a bit surprised by the reports. I would have guessed the answers were coming from larger organizations but the distribution of respondents was about 3/4 from SMB companies.
— Chris Ryan, Fusion Marketing Partners
Our firm works primarily with tech clients and we’re definitely seeing RevOps roles become more commonplace. We see it as part of a larger trend, namely the merging of sales and marketing functions as companies seek better internal alignment on goals, tactics, investments, etc. and also a more consistent experience across the entire customer journey. In that vein, newer titles like Chief Revenue Officer and or even Chief Growth Officer are reflective of the same trend.
— Howard Sewell, Spear Marketing Group
Is RevOps Really About Improving the Buying Experience? Not Yet
Improving revenue productivity is a Good Thing. But in the end, it’s doing what you’ve always done, faster and more efficiently. With most companies doing much the same, it doesn’t change the game long-term.
I’m not convinced that improving the buying experience is what is driving current RevOps interest. And neither is Craig Rosenberg, founder and chief analyst at TOPO (now part of Gartner) which has studied how companies are able to drive high growth.
What the secret? Rosenberg says it’s not one thing, but points to a few common traits. Fast-growing companies invest heavily in demand generation and sales operations (for qualification or outbound), and back that up with a solid sales process. Oh, and reps are trained in that “old school” fundamental — ability to sell value.
What role does the buying experience play? Well, Rosenberg’s take is that CMOs may track NPS to monitor the buying experience and most everyone says “we care about CX” but when it comes time to invest CX resources the wallets remain shut. This is exactly what I’ve been finding in recent interviews — a general agreement that CX drives growth, but little engagement at the operational levels of marketing and sales organizations.
But it’s easier to gain interest in optimizing revenue processes, says Rosenberg. That’s why RevOps is such a hot topic today. As companies grow the problem of organization and data silos gets worse. To boost revenue productivity requires linking marketing and sales (and more recently customer success) systems to provide a more unified view of the buying experience, enabling better coordination of everyone on the revenue team.
LeanData, for example, provides solutions for lead-to-account matching which can help sales reps more effectively and productively engage with prospects. McBrearty says that analytics can help reps focus on the most attractive accounts and individuals with a propensity to buy. My take is that while this could improve the buying experience, the main driver (for now) is the rep’s productivity in closing deals.
Time for RevOps 2.0?
RevOps as currently being implemented is a good and necessary step toward improving the buying experience. A platform of technology, data, and processes linking the experience from research to buying to purchase to usage can only help.
But actually improving the buying experience (as buyers perceive it) is required for a sustainable competitive edge and higher growth, according to research by Deloitte.
I would challenge RevOps devotees to take a look at this high-level Deloitte diagram of the buying experience. Notice that each touchpoint is described with a buyer objective. Does your RevOps plan help buyers, or it mainly a way to literally “rev up” the marketing and sales process you already have?
Harry Datwani, who leads Deloitte’s US Sales Transformation offering, agrees there is value in the RevOps idea. While it’s currently about revenue efficiency, that’s because it’s an easier business case to make than linking buying experience improvements to revenue growth.
What are B2B customers looking for? Deloitte research found that customers seek:
- Personalization, including tailored interactions and offerings
- Speed, by delivering frictionless buying journeys and enabling self-service
- Outcomes, from solving problems through partnership to delivering on promises to realize value
Datwani also believes a Chief Revenue Officer (CRO) can be helpful as “one throat to choke” in meeting revenue goals, but it’s not mandatory. Some companies are able to create a more collaborative approach among senior sales and marketing execs without a CRO. RevOps teams tend to report to CROs, CEOs, and COOs — according to the LeanData-backed study.
As I see it, RevOps is foundational to a CX strategy aimed at improving the buying experience. But the current emphasis on process efficiency needs to evolve to a more strategic approach of improving buyer perceptions and linking that to long-term growth.
Yes, that’s a tougher nut to crack, but because it’s harder fewer companies will make the effort. That’s why a superior CX is, in my view, more sustainable than operational excellence.
For starters, ask yourself whether your RevOps efforts help make buyer experiences more personalized and frictionless while delivering the outcomes they seek. I think you’ll find plenty of common ground to make experiences better for the buyer while also driving higher revenue growth for the company.