How Does Revops Model Create value?
How Does Revops Model Create value?
In the ever-evolving landscape of revenue growth, traditional structures for managing people, processes, technologies, and assets have become inadequate. The 21st-century commercial model, marked by digital, data-driven, and complex buying, demands a shift in management approaches. Complex technology-enabled selling systems and shifts in B2B customer buying behaviour have redefined the basis for revenue growth.
The forces driving this change are fundamental:
Customer Experience as the Basis of Competition:
Digitally empowered customers prioritise speed, agility, personalised content, and channel integration. Organisations face pressure to establish a unified cross-functional commercial process for a seamless customer experience.
Importance of Customer Equity and Lifetime Value:
Cloud business models emphasise growing customer equity and lifetime value as drivers of firm value, necessitating collaborative efforts among sales, marketing, customer experience, and support services teams.
Critical Role of Commercial Assets:
Customer data, technology, content, and digital channel infrastructure have become key growth assets. Proper measurement, funding, and management are crucial for supporting the entire revenue team and enabling scalable technologies.
Information Velocity and Visibility:
Selling effectiveness now hinges on information velocity and visibility. Real-time insights into customer engagement, seller effectiveness, account health, and pipeline status are paramount for distributed and dynamic revenue teams.
Teamwork Across Functions:
Eighteen strategic levers, from information agility to customer equity, contribute to revenue growth. Coordinating marketing, sales, and service as one revenue team with a common purpose has become a primary growth imperative.
The consequence of neglecting these shifts is commercial obsolescence, resulting in lower financial returns and higher selling costs. The solution lies in a new management system suited for the 21st-century commercial model.
Revenue Operations Model:
Revenue Operations (RevOps) emerges as a management model aligning sales, marketing, and customer success teams, along with their supporting assets, systems, and processes.
The six elements of a RevOps model are:
Commercial Leadership: Top-down leadership for unifying sales, marketing, and service into one revenue team.
Commercial Operations: Reconfiguring operations to provide end-to-end coherent management of all growth-related aspects.
Commercial Architecture: Redesigning and optimising the commercial architecture for maximum return on selling assets.
Commercial Insights: Transforming customer engagement and seller activity data into valuable insights.
Commercial Effectiveness: Building capabilities that maximise the contribution of selling assets to revenue and profit growth.
Commercial Asset Management: Strategically managing data, technology, content, and IP assets for maximum impact.
Adopting a RevOps model becomes crucial for B2B organisations, requiring board-level attention, CEO leadership, and a willingness to change entrenched beliefs and management models. Revenue operations directly impacts fiduciary responsibilities to protect and grow firm value, making it a board-level issue. CEOs, private equity investors, and boards are recognizing the need for business model transformation and the importance of aligning revenue teams to generate growth and net recurring revenues. In a landscape where organic growth and well-managed commercial assets are essential to value creation, the RevOps model stands as a strategic imperative.