What is Revenue Operations?

For many organizations, Revenue Operations (RevOps) is a fairly new and often mysterious concept. Few leaders have had exposure to a mature RevOps function. Instead, many have seen siloed operations functions, created to support specific aspects of the revenue organization that serve more of an administrative role than anything else. Even more commonly, these functions are all crammed into a single role.

Forrester defines Revenue Operations as, "the strategic and organizational alignment of the resources, people, processes, and technologies that drive the conversion of prospects to customers and maximize customer lifetime value. It is an alignment of the functions that determine the success of a company’s revenue lifecycle."

Simply put, Revenue Operations (RevOps) maximizes an organization’s revenue potential. It’s a business function that aligns the operational strategy and execution of each department that contributes to an organization’s revenue. RevOps connects the dots between the people, process, and technology across all go to market functions, rallying the business behind common metrics and goals.

Evolution of Ops

Sales Operations originated at Xerox in the 1970s as an administrative function to support and react to the operational needs of the sales organization. Over the last 50 years, businesses and the way they purchase solutions have evolved dramatically. Customers expect a better buying experience and more value, creating opportunities for new solutions to enter the market and increased pressure to stay competitive. This coupled with the shift from single to consensus decision-making (among many other factors) has presented new and increasingly difficult challenges for revenue organizations to overcome.

As a result, similar operational functions have cropped up to independently support other departments within the broader go to market organization. This unintentionally created silos within each department, making it more and more difficult to align all these critical functions behind a shared strategy and goal. The rise in venture capital funding over the years has poured fuel (ie. a massive amount of money) on the fire, increasing competition and forcing businesses to find an edge wherever they can.

More recently (last 5-10 years), progressive leaders have been experimenting with innovative ways to centralize all go to market operational functions and break down those problematic silos — RevOps is born. This coincides with a push over the last 5 decades to evolve these operational functions from reactive and administrative, to proactive and strategic. Executives realized that an aligned RevOps function with a stake in strategic go to market decision making yielded a far more focused and collaborative revenue organization.

In the midst of today’s rapidly changing market, businesses are more focused on go to market efficiency than ever before. Leaders are now prioritizing RevOps functions early on to lay a solid foundation to build off of, making it easier and more predictable to scale. As of 2021, 96% of leaders surveyed by Forrester believe RevOps is important to the success of their organizations.

Sales Ops ≠ RevOps

There is a somewhat common misconception that Sales Operations and Revenue Operations are the same thing. While the line between the two can certainly be blurry at times depending on where an organization is in their lifecycle, these two functions are fundamentally different.

Sales Operations is focused solely on optimizing the sales function and does not directly influence other departments like marketing, customer success, finance, etc.

Revenue Operations however, has a much broader scope. Rather than focusing on one particular piece of the process (ie. lead to customer), RevOps takes a comprehensive approach to optimizing the end-to-end revenue process across the entire organization. This means starting from how the solution is positioned in the market, to generating demand, developing leads into opportunities, converting opportunities into successful customers, ensuring prompt payment, and everything in between.

RevOps Drives Success

Organizations that embrace RevOps as an important strategic function simply outperform their peers.