I’ve spent the better part of 20 years starting and growing Revenue Operations (RevOps) teams at various-sized SaaS companies. Over and over again, I see a fascinating dynamic play out. It catches many off guard, but it is perfectly predictable.
Before hiring their first RevOps role, many can’t imagine finding enough work to keep one person busy full-time. Yet once a RevOps team is in place, it doesn’t take long before they feel overwhelmed by demand and a rapidly growing backlog. What’s driving this drastic shift?
Consider a new product that is the first of its kind, preparing to go to market. Customers haven’t yet experienced its value, and may not even be able to adequately conceptualize it. At this stage the product roadmap is defined purely by the imagination of its creators. As early-adopting customers begin to use the product, the concept becomes reality and the tangible nuances of the user experience start coming to light. To improve their experience customers request product enhancements. Now the roadmap is being shaped by real customer feedback. Every enhancement released meets a customer need, but also leads to more nuances. Thus product requests begin to accelerate.
What’s happening in this scenario? The product is creating its own demand for more. The growing backlog is not a problem of resourcing. It’s a validation of value.
As a RevOps team begins to deliver value, stakeholders begin to want more. Eventually RevOps evolves from a person to a team, to a team of teams. Let’s explore each stage of RevOps development and the transition that is required for each.
Stage 1: Foundation
The first stage is all about laying a simple foundation to measure and manage your revenue generation efforts. While the specific scopes of responsibility vary from company to company, an operational foundation typically requires the following:
- Tracking lead generation by source and channel.
- Lead qualification criteria and hand-off to Sales.
- Routing inbound leads to sales reps.
- Sales pipeline tracking, including clearly defined sales cycle stages.
- Revenue performance metrics, reports and dashboards for senior leadership.
- Hand-off process from Sales to Customer Success.
- Technology implemented to enable all of the above (CRM, Marketing automation).
- Sales compensation plans.
- Basic data quality management (field validation rules, manually deduplication, etc).
At this early stage the key is to keep your operations simple and nimble. You will be experimenting a lot, so you need to be able to adjust rapidly. For example:
- Your leads should be distributed evenly across reps until volumes are high enough to warrant sales territories.
- For reports and dashboards, you probably don’t yet need a BI tool. Use the capabilities within your CRM and marketing tools, supplemented by spreadsheets.
- Keep your tech stack lightweight, bearing in mind that what you build you also have to maintain.
- Your sales compensation plans should be so simple that reps can tabulate their commissions without a calculator. For example, a percent of revenue booked, or a dollar amount per deal sold. One component. No weighted point system. No claw backs.
- Sales quotas should not be introduced until a sales performance baseline has been established.
RevOps’ first stakeholders tend to be Marketing and Sales, but can also include Customer Success and Partnerships.
Your First RevOps Hire
I am often asked what the ideal profile of the initial RevOps hire should look like. Leaders struggle with this question because of a seemingly contradictory set of requirements:
- On the one hand, it is an individual contributor role. On the other hand, it requires a mature mind, able to communicate and negotiate with senior leaders.
- It is a deeply technical role, but requires strategic soft skills like project management and analytical thinking.
- You need an independent self-starter, but one who is natural at building relationships and trust with stakeholders.
Given this paradox of requirements, is it best to hire a senior analyst looking to grow into leadership, or an established leader that is happy to roll up their sleeves until they are ready to hire others? Both are excellent options and deserve to be considered. When hiring this candidate, qualify based on experience, but hire based on attitude and mindset. While your job description should attract applicants based on their experience, look for these softer attributes when making your final hiring decision:
- A natural curiosity and a learning mindset.
- A pro-active, transparent communicator.
- Humble enough to want to serve others.
- Confident enough to communicate a strong opinion.
- Open enough to consider others’ feedback.
To help identify these attitude-based attributes, pay close attention to the questions they ask, and give them plenty of opportunity to do so, especially in the latter stages of your interview process. You will find that you learn more about how a person thinks by the questions they ask than the statements they make.
It should be noted that due to the broad nature of candidate requirements, you may find wonderful candidates with no Revenue Operations background. Many professions enable people to develop their technical chops, an analytical mindset and the development of relationships across teams. Some of my best RevOps hires came from a background in science, education and consulting.
Who Should Your First RevOps Hire Report To?
The answer to this question depends on your current leadership structure. Here are some guiding principles to consider:
- Your reporting structure will likely change as your company grows. Think of this decision as “Who will RevOps report to at this stage?” Not forever.
- In more mature organizations RevOps can be well positioned under the Chief Revenue Officer, Chief Operating Officer, or Chief Customer Officer. At earlier stages when RevOps tends to be introduced, these executive roles may not yet exist.
- They need to think across the whole revenue organization. If they report to the Head of Sales, they should still be thinking beyond Sales, including Marketing and Customer Success (and Partnerships, if relevant).
- If they report to the Head of Finance or the CEO, they should operate as a close supportive partner to Sales and Marketing.
Stage 2: Optimization
As your RevOps function matures into the optimization stage, you begin to introduce capabilities for optimizing revenue performance. Such capabilities include, but are not limited to:
- Automate nurture campaigns for leads that are a good fit, but aren’t yet ready for an active sales cycle.
- Forecast revenue base on your sales pipeline.
- Automate and pre-package Sales plays through a tool like SalesLoft or Outreach.
- Enhance Sales coaching and conversational insights through a tool like Gong, Chorus, or ExecVision.
- Improve prospecting data sources through tools like LinkedIn Sales Navigator, or another source specific to your target market. Be sure to take note of prospecting compliance regulations in your region, like CASL and GDPR.
- Reinforce good sales practices through training, enablement and content.
- Enhance your reporting, offering more insights for your Sales, Marketing and Customer Success leaders. These insights should focus on efficiency, and correlate activity to results.
- Perform data analysis to offer insights and recommendations that improve revenue performance.
3 Types of RevOps Work
At this stage in your company’s RevOps journey you are likely getting a steady stream of new requests from your revenue-influencing teams. Now you have three types of RevOps work:
- Maintaining your foundation: Refining what you built in Stage 1, supporting your technology users, and nurturing process adoption.
- Supporting stakeholder initiatives: Many of your stakeholders will rely on you to fulfill their initiatives. For example, a new product requires CRM updates, and a Sales campaign or a customer onboarding process requires tracking.
- Owning RevOps initiatives: Owning your own initiatives requires you to garner buy-in and support from other stakeholders, drive execution, measure the impact, and communicate results.
This may seem like a lot, but take heart! Your ever-increasing RevOps backlog doesn’t have to overwhelm you. The secret is in a pivotal mindset shift: Clearing your backlog can no longer be your goal.
During the Foundation stage, fulfilling stakeholder requests is important. It builds trust and good will, which is critical at the inception of any function. As you enter the Optimization stage trying to clear your backlog is not only unrealistic, it is unwise. It’s time to convert your backlog into a roadmap.
Differences Between A Backlog And Roadmap
|Why?||The goal is to keep up with demand, leading nowhere in particular.||The goal is to fulfill a clearly defined strategic vision.|
|What?||A series of independent requests.||A cohesive set of enhancements delivered over several phases.|
|How?||Requests are commitments to be fulfilled.“Yes” by default, unless declared “No”.||Requests are feedback to be considered.“No” by default, unless declared “Yes”.|
|When?||Prioritization is based on who places the greatest demand.||Prioritization is based on what best aligns with the strategic vision.|
Here are two practical ways to transition from backlog to roadmap:
- Create an intake process. When receiving requests, communicate that you will review the request and confirm whether it will be fulfilled. Requests will either be fulfilled right away, find a home in the roadmap, or be rejected. Establish an SLA for when you will review and communicate one of these 3 dispositions. It’s important to close the loop in a timely manner. A clear “No” is better than an ambiguous “maybe”.
- Use the items in your backlog as feedback for your roadmap. Look for recurring themes in the problems to be solved and the value to be created. Obtain stakeholder feedback on your strategic vision and the phases to fulfilling it. If you can gain buy-in at the “why” level, then you will have a foundation to negotiate at the “what” level. Once developed, declare your strategic vision and the roadmap to fulfill it. Commit timelines only on the immediate priorities. Allow your roadmap to evolve over time, but always know where you’re headed next.
Going From A RevOps Person To A RevOps Team
Given your expanded scope of responsibilities, and your roadmap mindset, this is a natural juncture for RevOps to evolve into a full team. At this stage, every hire will report directly to the RevOps leader. While how you design your new roles will depend on the specifics of your environment, here are commonly effective roles for you to consider:
- A Technical Analyst that will own your CRM system, other Sales and CS technology, and the associated vendor relationships. Some companies keep the Marketing tech within Marketing, while others include them within RevOps.
- A RevOps Analyst that will own reporting and insights, data quality, and requirements gathering for your technical analyst. This person will also act as a dedicated partner to your heads of Marketing, Sales, Customer Success and Partnerships.
Here are some guiding principles to ensure RevOps is set up for success as a team:
- You may require more than one of each of the roles described above.
- I recommend hiring at least one Senior Analyst in each role, because in the next stage of growth, these individuals will become their own teams. Assuming strong performance, it’s more fun to get promoted and hire a team than to get a new boss!
- Assuming commensurate performance, this may be a natural time to promote your RevOps leader into a Director position.
- Depending on how your executive team is designed, this is also a good time to evaluate if RevOps is reporting to the right executive leader.
- Your RevOps Leader will continue to carry some direct responsibilities, so I recommend no more than 5 direct reports. This will ensure each team member is well supported, and the leader is not overstretched. Some leaders try to push themselves to manage 7 or 8, but ultimately find themselves neglecting either their team members, or their direct responsibilities. They need another people leader on their team.
Your RevOps Leader’s role can now evolve to focus on the following:
- Own Executive relationships.
- Analytical insights and strategic recommendations.
- Oversee complex cross-functional projects.
- Hire, coach and manage the performance of the RevOps team.
- Nurture relationships across the organization.
- Learn from other organizations, staying abreast of emerging RevOps practices.
This is a wonderful time to invest in your RevOps leader, offering a leadership or executive coach, and enabling them to join and attend broader networking groups with other RevOps leaders.
Operating As A Team
Now that RevOps is its own team, your RevOps leader will need to establish basic team practices:
- A clear and compelling vision for the team and the impact it will ultimately have.
- Operating principles to guide how the team will operate to ensure impact.
- Team cadences to nurture an intentional team culture, communicate updates, and coordinate priorities.
- Team development to ensure they are honing their skills, and developing strong relationships.
- Recognition practices to shout out great work and those who are leading by example with your operating principles.
Stage 3: Innovation
Every stage builds on the next. So as you enter the innovation stage, you are not innovating instead of optimizing. You are innovating as you optimize, and as you continue to manage your foundation.
There are three factors that will shift your RevOps function into a team of teams:
- Volume of work: The sheer amount of work needed will require more people than one leader can reasonably manage.
- Breadth of skills: The variety of skills now required in RevOps warrant different teams that specialize in their respective skill sets.
- Depth of skills: The increasing complexities of your business will require a deeper level of expertise from each RevOps team. You will want a manager for each team that can offer a meaningful degree of technical coaching and oversight.
Given the level of sophistication at this stage, it’s important to simplify the stakeholder experience as much as possible:
- Your stakeholders may not know who to go to for what. Make sure you clearly define and document how to engage with RevOps.
- Consider structuring your team to offer a dedicated partner to each stakeholder. They will be the voice of the stakeholder group into RevOps, and the voice of RevOps to the stakeholder. They should join both leadership team meetings, offering constant context in both directions.
Keep in mind that your stakeholders entail two types of relationships:
- Internal customers: RevOps works in service to the success of these teams. RevOps is not succeeding unless they are succeeding. Such teams include Marketing, Sales, Customer Success and Partnerships. You may also deem the Executive team to be an internal customer group.
- Internal partners: RevOps works with these teams to effectively serve their internal customers. These are symbiotic relationships that tend to be interdependent. Such teams may include Finance, Human Resources/People, IT, Security, Legal, Product, Engineering, and Data Science/Business Intelligence.
Why Innovation Matters At This Stage
Innovation has mattered at every stage in RevOps’ journey, but it plays a special role at this stage. To innovate simply means to do something new, or in a new way. At the previous stages, you could reasonably look to common practices and apply them in your environment. As your business grows more complex, your requirements become more nuanced, and your solutions must become more customized. Inevitably you will have to experiment with new, unproven methods to realize your full value. This is why it’s so important to stay plugged in to the broader RevOps world, and always watch for interesting emerging solutions.
Reflections On RevOps Talent
As RevOps matures from foundation to optimization to innovation, you will meet a range of amazing people. One of my favorite aspects of leading a RevOps team is the fact that its talent can come from so many different backgrounds and experiences. If your team is designed well, you will enjoy a rich variety of perspectives. This can become the secret sauce in your RevOps team. It will create an attractive culture that other teams will take note of and want to join.
Not everyone will remain in RevOps. Just as your talent came from different backgrounds, they will grow into other functions as well. I have seen RevOps team members join Finance, Sales, Marketing, Product Management, Customer Success, Enablement and other teams. Some have even left to start their own companies. This is a high compliment to the RevOps community. Its value lies not only in its ability to optimize revenue performance. RevOps is a remarkable leadership incubator that impacts other teams, other companies and even other industries.