It’s that time again, annual planning. I absolutely love this time of year! Why, you may ask?? Because this is when RevOps analytics and optimization flows really shine.
Now, if you’ve been around B2B for more than a few years, you’re going to laugh at this – because you know it’s true! Many companies we’ve worked with had a process for setting bookings targets that looked like this: Take what we booked this year, increase it by 35%. Done.
How do you know whether you can hit that? Many companies think they just need to work harder, hire more salespeople, throw more money at marketing. Believe me – that is not the way to accelerate and sustain growth! It IS a great way to burn through some serious cash.
Now, let’s look at the RevOps approach.
What will our bookings be next year based on the size of our current pipeline?
We increase deal closure by 2%?
We improve lead generation by 15%?
We increase deal size by 8%?
We know that in B2B, our sales cycles are typically long and complex. You can look at your pipeline today and, if you have a RevOps model, you can determine what that pipeline will deliver over a 1 sales cycle time period. You can then extrapolate that model to do accurate forecasting, like this:
- Forecast at current performance
- Forecast with 2% better deal closure
- Forecast with 15% more leads
- Forecast with 8% larger average deal size
Answers at your fingertips.
There are many more attributes you can tweak in your model, of course. But your scenario planning is going to change the way you think. Take this example (from a real company):
If I want to hit a desired bookings target for this product, the model tells me I need 600 leads per quarter. My market size will not yield that many leads because there aren’t that many accounts. We need to change our bookings target and look to other products that have a more realistic model.
Wouldn’t it be great to know that there is no way you are going to hit a particular bookings target?
If we are going to solve problems that matter, the ones that will really impact growth, we need to know WHAT THE PROBLEMS ARE. Too often sales and marketing leaders are guessing at that. Here’s what a RevOps model can tell you:
- Your proposals are bottlenecking your sales cycle. Focus on improving your proposals.
- You can reduce your wasted sales time by 30% if sales reps focus on deals in retail and financial services.
- You can increase your deal size by 15% selling into manufacturing companies that are between 1,000 and 5,000 employees.
- You can increase your win rate by 20% if you involve IT personas in the sales process.
- Target marketing programs to Sales personas using this message: ABC. These result in deals that are 25% more likely to close.
These were easy to come up with because all of these are actual answers (with industries and numbers changed) that ayeQ customers used to improve their annual plans.
With RevOps, you not only set bookings targets that are highly accurate, but you identify strategic areas for focus and improvement – the ones that will actually impact growth.
I love this time of year.
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