For tech business leaders and founders, there is typically a learning curve of experience needed to even feel like you have a full grasp of all aspects of the company. The better you formulate your business for success the greater chance you have to reach the financial goals you desire.
Your ability to analyze data and transform those analytics into real results will be determined by the approach you choose and the RevOps team you have in place to execute it. In financial matters, being a good finance business partner can greatly benefit the direction your company is heading towards.
Incorporating strategies and software that help ease the workload is important, especially for SaaS and B2B companies. For those business models, it is crucial to find customers that will ensure the growth and survival of the company from the early stages. And revenue is the focus. This is where RevOps could be the make-or-break strategy that drives the success of the company. Whether you are a SaaS CFO or run an entire finance team, this blog is going to show you how incorporating a RevOps team will improve customer success, support revenue growth, and ultimately boost your company's bottom line.
Back to basics: What is RevOps?
Revenue operations, also known as RevOps, is the business practice that aims to maximize a company's revenue by aligning the sales, service, and marketing team. RevOps is defined as a business-to-business functionality that focuses on optimizing the whole customer lifecycle process from marketing to sales ending in customer success. These serve several purposes for a company such as:
- Helps stabilize the price for better conversion rates and higher margins
- Reduces revenue leakage
- Takes your customer data to identify potential revenue opportunities
RevOps can serve distinct purposes for businesses, but the final objective of implementing this strategy is to improve decision-making. By transforming the operational process and taking different teams in the same direction, the entire business unit can work together to get cash flowing in. By shifting their focus to support financial planning for better cash flows, teams are able to improve collaboration and work towards a common goal of revenue growth at all levels of an organization. The more your system caters to the relationship with your customers, the more successful your RevOps campaign will be. Revenue operations emphasizes customer success at every angle from marketing to sales ops. By aligning all teams, RevOps is able to encourage revenue generation all while supporting their overall customer satisfaction.
Other key points of RevOps
While RevOps does offer data that can grow your business in new areas, its most impactful function is the ability to identify where your company currently excels and lacks across the different departments. This data helps you cut places where revenue is being lost as well as see the statistics where your highest streams occur. Below are some of the key metrics that RevOps teams use to identify pain points and opportunities.
Most common RevOps metrics:
- Cost per Acquisition
- Annual recurring revenue
- Total contract value
- Churn rate
- Renewal rate
- Customer lifetime value
- The average revenue per user
- Day sales outstanding
- Revenue backlog
These metrics help your company identify key factors in your business strategy while simultaneously altering your business focus from one-and-done shoppers into repeat business. This strategy relies heavily on developing brand/product loyalty.
How to successfully implement RevOps into your company's plans?
The most effective way to start with RevOps to improve your business is by gathering all necessary data and analytics. The data you should be keeping your eye on includes:
- Product data
- Account data
RevOps teams use this data to create an entire financial plan, ensuring that the company's overall revenue goals are supported and met across the different departments. By using these metrics, top management can see gaps and opportunities within their current business model.
You as a financial business partner should simply bring the product-to-cash process into one platform, integrating it and implementing the needed steps to execute and drive results. The goal is to automate your business and grow more efficiently.
The 4 core necessities of RevOps every business owner should know
As we have discussed, RevOps is a business-to-business financial strategy. The main goal of this process is to prioritize your customer journey in your operational process. By promoting customer success across your different departments, everyone within the company will have a centralized goal and be able to improve operational efficiency throughout the entire company.
Strategy is the first core principle of any RevOps function and essentially the most vital to the entire process. A well-thought-out strategy allows you to have a cohesive movement throughout your company and support the customer journey at every stage.
Insight focuses on the data gathered and being used to implement the best strategy possible. The more detailed your insight is the better the results you will get from your RevOps strategy. Your data can help you determine key components to selling one or more of your products. It also can help you determine pricing discrepancies, revenue drivers, and the demographic that tends to shop via your RevOps strategy.
Enablement means your ability to integrate your strategy into your current business model. The goal is to create the most effective pathway to your product or service for your customers to purchase. Enabling them to access your products through multiple channels lessens the chances you will lose a customer, helping to improve customer retention and satisfaction.
Tools that help you simplify the process are what make this principle so vital. Your strategy should make achieving your goal easier. The tools you have access to in your RevOps strategy will ultimately determine if finance automation for your business is achievable and sustainable.
Do I need a SalesOps or RevOps strategy for my company?
Let's try to understand the difference between a SalesOps and RevOps strategy for increasing revenue. SalesOps prioritizes sales reps as the more efficient and more productive way to drive revenue. On the other hand, RevOps focuses on the products and services that your company derives its revenue from.
These strategies are both helpful but you must decide which best suits your business. As important as a strong sales team can be, there is nothing more solid than having a product that customers want and enjoy.
The product-to-cash method provides the clearest pathway to your product while SalesOps takes you through another channel in order to convince a customer. If your product speaks for itself there is no need to convince your customers. This is where RevOps strategies showcase their strength and efficiency level.
If you are a SaaS CFO looking to grow your company, take the time to develop the financial partnership. Simplify your business structure, identify your key revenue streams, and ensure you have a clear method to follow that promotes sales and, ultimately, automation. There is true power in utilizing tools that help to establish a stronger connection to your paying customers.
Evaluating your strategy as a finance business partner can truly benefit many facets of your business. The insight you gain from diving deep into the efficiency of your operations can foster other revenue streams and opportunities simply from having the data gathered by a professional.
With Abacum, we empower finance teams of high-growth tech companies to become true strategic partners in the organization by driving time-to-insight with powerful automation and seamless collaboration. Request a demo now to see the product live and start your own transformational journey.