RevOps is not Systems Admin. RevOps is a strategic advisor to leadership, providing valuable Insights into the Revenue Engine.

We can build the perfect tech stack, fine-tune marketing and sales funnels and automate every step in the process. We can spend our lives doing this and many do. This does not drive revenue growth, though. It helps the team work more efficiently, but is that work effective?

To answer that question, we need Insights. And that, my friends, is what RevOps brings to the table.

So what are insights, and what do you need to generate them?

The Fundamentals

Everyone wants Insights. This is not a hard sell. Unfortunately, we can’t get them without the right foundation. We shared this in last week’s article on the Revenue Efficiency Pyramid. If we don’t have our GTM Strategy and our Sales Methodology well defined, for example, we can’t configure Salesforce or expect Salespeople to use it in the right way. As a result, we will not be able to trust the data in those reports.

To get Insights, we need to make the right data required by the team, analyze that data, and call out the “so what?”

Identify the Right Metrics

With the foundation we mentioned above in place, we need to select the right metrics to track. We have to push the sales team to collect the right data to measure these metrics so we need to be very careful. If we ask for too much we won’t get it and/or we will lose valuable selling time and productivity. If we don’t ask for enough, we will continue to operate in the dark.

Every Revenue Team is different, so each needs different metrics. However, here are the most common in B2B SaaS.

Lead Generation (MQLs)

MQLs (Marketing Qualified Leads) are marketing-generated leads that meet certain qualifying criteria, such as a Lead Score. Lead Generation would be the number of MQLs generated in a given timeframe, such as a quarter.

Pipeline Generation (SQOs)

SQOs (Sales Qualified Opportunities) are sales opportunities that meet specific criteria to enter the pipeline. Pipeline Generation is the number, or total dollar amount, of SQOs generated in a given timeframe. Many revenue teams measure it in both numbers and dollars.

Sales Cycle

The Sales Cycle is typically measured in the number of days between the Close Date and the Created Date for Closed Won Opportunities.

Close Rate or Win Rate

Win Rate is a ratio of Opportunities that are Closed Won/(Closed Won + Closed Lost).

Average Sales Price

The Average Sales Price is the average amount of Closed Won Opportunities in a given timeframe. This is measured based on the key financial metric your business needs. It could be MRR or ARR or TCV etc.

Pipeline Velocity

Pipeline Velocity combines the four metrics above, Pipeline Generation, Sales Cycle, Close Rate, and Average Sales Price into one single metric. We went into detail in this article on Pipeline Velocity and also explained why it’s important to measure Sales Cycle, Close Rate, and Average Sales Price with Closed Won Opportunities only.

Sales Capacity

Sales Capacity is the total number of Opportunities one sales rep, or the whole team can manage effectively. This is one of the most important metrics that are so often ignored. If pipeline generation exceeds sales capacity, we will be pouring money into a leaky bucket, losing sales for no other reason than a lack of resources. If you have more than one role in your sales team, then this number should be role specific.

This is just a starting point. It’s also fairly easy to implement and expect of your sales team as it does not require a time-consuming process or data entry. As you grow from here you will need to balance the desire to have every data point with the need to keep your sales team selling, not entering data all day.

Enablement is Key

Once you’ve identified the metrics you want to track you need to build the process, workflows, and data structure in Salesforce to capture that data. This is an entirely separate article, or series, on its own. So, we will leave it at that.

This is all for nothing, though, if you can’t get your team to adopt the process and enter the required data. Enablement is king here. Start small, with a reasonable ask. Build the Reports, and ideally a single Dashboard.  Share them with the team and train them on the process and the date. Then reinforce that training every day, every week until it becomes standard practice.

This is the only way you can get reliable data to feed the Insights you want.

Look for Trends

Once you have these metrics and the data in place, you can start to uncover a lot of value.

The first key type of insight is a simple trend. You should report on the trends of all of the key metrics above and write up a summary. Then, share the summary with leadership at least once a month. This is the backbone of any reporting paradigm.

Ask yourself questions like:

•  How many leads did we generate and how are they trending?
•  How much pipeline did we open this month versus the same month last year? 
•  How has our win rate changed since we started targeting that new segment?

Review the data. Call out findings. Report out a summary. Don’t just send the report. Write up what you see in the data.

Isolate and Go Deeper

The next thing to do is to start isolating things that fall outside of the baselines you initially established. What data is bucking the trend and why? What is going on here?

When you find them, go at least a layer or two deeper. Ask the WHY! Come up with hypotheses.

For example, let’s say our bookings have dropped.

There are many reasons this could happen:

1. Did our Average Sales Price drop?
   1. Could this be a result of discounting?
   2. Could it be the composition of our pipeline?
   3. Could it be user error in putting together quotes?
2. Did our Win Rate drop?
   1. What stage in the sales process dropped the most? Why?
   2. What do we see if we break this down sales rep by sales rep?
   3. What do we see if we break this down by each marketing channel?
3. Did our Sales Cycle increase?
   1. If it did then deals just aren’t closing but haven’t been lost, future forecasts should take that into account and perhaps tactics like expiring offers could be used more effectively in the future to incent customers to move quickly. Perhaps there are some tactics reps could use to be better project managers of deals, like mutual action plans.
4. If our win rate and our average deal size didn’t drop then our input into the Sales system did.
   1. Did the number of opportunities opened decrease and has it gone back up?
   2. Did we see fewer leads than before? Has that gone back up?
   3. Did we convert at a lower rate than before? Has that gone back up?

These are just examples, but simple metrics like these can provide deep Insights. You don’t need a supercomputer or advanced BI tools. You just need a little curiosity and the willingness to ask yourself the hard questions and dig deep.

Go Even Deeper 

With each question above, there is a subsequent hypothesis or two that can be identified.

Our bookings are down because we discounted more heavily. There are two possible reasons for this. We discounted too heavily and need to limit discounts. Or, a competitor undercut us, and reducing discounts will hurt our win rate. These scenarios lead to valuable experiments and discussions with leadership to drive revenue and position us as a trusted advisor.

These are the kinds of conversations your leaders want to have with us. These are the kinds of conversations that drive REVENUE.

These are the insights that bring the promised value of RevOps to leadership and make us a trusted advisor.

SUMMARY

1. Build the right Foundation
   1. Establish your GTM Strategy, Sales Methodology, etc.
   2. Read the Revenue Efficiency Pyramid article for more detail
2. Identify the right Metrics
   1. Lead Generation, Pipeline Generation, Sales Cycle, Close Rate, ASP, and Sales Capacity
   2. These are some of the most common metrics and enough to drive deep Insights
   3. You don’t have to over-engineer this. You don’t need a supercomputer.
3. Focus on Enablement
   1. Enablement transforms plans into execution.
   2. Without it you will never have reliable data to drive Insights
4. Look for Trends
   1. Don’t just look at the metrics today
   2. Look at how they are changing over time
5. Isolate and Dig Deeper
   1. Isolate metrics bucking the trends
   2. What is going unexpectedly well or poorly?
   3. Why is this happening? Dig deeper to find out.
6. Go Even Deeper
   1. Think about “The 5 Whys”
   2. Ask why again and again until you get to the root
   3. This is what makes RevOps a strategic advisor to leadership