RevOps 2.0: Earning a Seat in Corporate Planning

0:00 Where we see a real distinction in terms of contribution to the organization and what distinguishes what we call RevOps 2.0 from 1.0 is the role that RevOps can play in corporate planning.

0:26 Welcome to The LeanScale Podcast where we talk about everything RevOps. Thank you for listening.

0:37 Planning is one of the most important components of any revenue operations department, and I'll be honest, a lot of RevOps teams, ones that I've worked with, and maybe in my early times as a RevOps professional, have definitely fell short of what the overall organization needs. So today we're going to talk about planning and more specifically how you can close the loop on your planning process. I have a special guest here with me today who's going to help us walk through it.

1:07 Alex has spent his last 15 years using data to grow businesses first in finance, which is obviously a good friend of revenue operations teams, for an ed tech startup in Chicago, and then at a dev tech company that sold VMware as a VP of marketing, and most importantly as the founder and CEO of Qflow. Alex, thanks so much for being here today. I'm really excited to go through it. Excited to be here as well. Thanks for having me.

1:39 So, absolutely. No, pleasure. So let's go ahead and jump into it. So all companies plan, revenue teams plan, ops teams plan, finance teams plan. I know you have a background in an eclectic group of roles, but how do you see the typical RevOps team planning today? So the typical RevOps team is involved with a number of tactical plans and tactical planning. And there's nothing wrong with that. It's required as part of what we call RevOps 1.0. That's planning out a tech stack so that reps can be productive, planning out a format for a sales call so that information can be rolled up in an efficient manner,

2:36 planning out territories, comp plans, CS playbooks, etc. Where we see a real distinction in terms of contribution to the organization. And what distinguishes what we call RevOps 2.0 from 1.0 is the role that RevOps can play in corporate planning. Namely, the plan that finance puts together that gets put in front of the board and against which the organization is measured for the next 9 to 12 months.

3:16 Yeah, and I think, you know, we've talked about this at LeanScale quite a few times, but there's different levels of your, I'll call it go-to-market operational departments, you know, sometimes the beginning you're running around with no ops, which is, if anybody's been in a company like that, and I'm sorry, I know how hard it is, then you tend to start to get siloed ops development, you'll get sales ops over here, marketing ops over here,

3:42 and then you get that first version of RevOps. So the team that's dedicated to managing the full go-to-market customer life cycle, really thinking about end-to-end solutions, not thinking about things in silos. So I always think that's a really big moment for a company because they started to make the investment in that area, but how do you go from that version to RevOps 2.0? And what's the difference? What's the difference between that initial RevOps team and then the potential that a RevOps team like that could have?

4:23 Sometimes it's in background, but not necessarily. We were just talking the other day about how you don't necessarily have to have a finance background to be that RevOps 2.0, but you need to change your mindset. If you're a RevOps 2.0, you are an internal management consultant, not just a project manager. You do need to understand the tools tactically, but you need to be more biz ops-like in your ability to situate everything together in a bigger picture.

5:01 So you're not just aligning operations to a strategy that's dictated to you. You're part of the strategy setting. To give you some blunt comparisons, RevOps 1.0 would be focused on the effectiveness of a tool that they're responsible for implementing. Does it work? RevOps 1.0 is responsible for maybe not just that, but also the efficiency of the tool. How much does it cost? How much does it cost to deploy? How much does it cost to maintain? How does this fit into the broader landscape?

5:38 A couple more examples. RevOps 1.0 might kick a report over to finance during a planning session, whereas RevOps 2.0 would be in the room with finance, sitting shoulder to shoulder. There are a few differences. You go from being a service center, managing requests for the CFO, the CRO, whoever is asking for it, and you become a department that is leading with insights, leading with recommendations, being part of the planning session.

6:16 Right. And we're talking about closed loop planning here, and so we can get into what that is. But for someone sitting there who doesn't have the BizOps background, isn't quite sure if they're contributing at quite the RevOps 2.0 level. Probably the easiest place to start, and one of the biggest places where you can help your finance team, is to implement some processes and potentially some tooling around closed loop planning.

6:58 I've always been a big fan of being part of the planning process, and maybe it has to do with my background, maybe it has to do with how my mind works, but I always wanted to be in the room. I always wanted to be leading the discussion. You let me know how you feel about this, but I think RevOps is uniquely positioned in the organization to really get the most business context out of any individuals in the organization, because you are on the front line with marketing teams, sales teams, customer success and service teams.

7:36 You're constantly looking at the data and constantly looking at what's working, what's not working in real time, and you're just in it all day. And to me, I feel like how does that department not become part of, if not even leading the planning process for the organization overall? I think there are a couple of reasons why that might not take place. One of the biggest reasons that we would see is the combination of a reactive mindset, to your point, tickets, requests, and not having the tools or the skills necessarily to efficiently measure everything that is needed to contribute to closed loop planning.

8:34 So this shouldn't be something, these measurements that go into a closed loop plan. Should we take an example? Should we take an example of the revenue waterfall as part of the closed loop plan? So your traditional revenue waterfall done well will contain five or six different things, which you should have a pulse on at all points of time in your organization.

9:07 Too often these things, like a normalized number of prospects that marketing and sales is engaging with, your sales cycle, time-based distributions to convert prospects into qualified ops, all those things too often are analyzed in conjunction with putting together a plan or a contribution model. And then they sit in a spreadsheet somewhere, get filed away in a drawer somewhere until the next board meeting, or if things are going well until the board meeting after that.

9:45 And that's where the slow slide begins. And we don't really remember what went into an analysis that drove an assumption in the plan. We don't have good documentation around how that assumption was modified based on something that's someone new operationally. And if we don't have those things measured in real time, then you can be sure that we're not looking at those inputs against the actuals as time goes on. And so that's where the closed loop, that's where what should be a closed loop ends up being something that's not closed loop at all.

10:30 I see most people approaching planning like this, and let me know if you see something different. September or October rolls around, they kick it off with maybe a strategy off-site, they go somewhere, you know, exotic, get away. And then they start, let's go gather the last couple years of data or whatever we have, and let's have the RevOps team number crunch, let's have the finance team number crunch, and then let's go, let's present a top-down plan.

10:57 The CEO and the board have a revenue target they want to hit, so we'll just figure out how to back into that. Launch it in January, and then we'll come back to it next late Q3, early Q4. That's what I typically see. Two questions, is that what you see? And then two, is that the process you'd recommend following, or is there something more teams need to be doing? That is the traditional behavior that we would see at an organization.

11:35 And part of that, I mentioned earlier, was part of that are the tools, right? So for RevOps, what we typically see is that if these measurements that go into the plan exist outside of Excel, then they're usually in a data stack somewhere that was not built for RevOps. It was built as part of a broader initiative to create a data stack at the organization. So that includes your data warehouse, your ETL layer, the visualization layer, a modeling layer like Looker, so that these queries can be published.

12:21 That is typically, and I shouldn't say typically, that's outside the wheelhouse of most organizations with a couple of RevOps folks. It includes, you know, you need to interface with a data engineer, data analyst, a data team. And so, yeah, the default behavior is, because it's a lot of work, is to only do it a couple times a year. Well, you're missing the early warning signals. And it's never great when you miss your number to have to go back and dig through assumptions to understand how the number was set in the first place. And by the way, it's not great when you overachieve your number to not really understand why.

13:13 Absolutely, the way that we would want to see this is that there is transparency and clarity for everyone in real time about the analyses that are underlying each of the metrics that drove an assumption in the plan. We want clarity in real time for the assumptions themselves, and then we want to track actual performance against those plan assumptions in real time. And so that's what we want to see. And when you say real time, what does that look like? Is that quarterly? Is that monthly? Is it daily? How do you see teams, the ideal RevOps team, functionally, operationally, what would that look like?

14:06 Well, you can group the data however you'd like, right? If you want to group by month or group by quarter, that's fine. But when I say real time, I do mean real time because there should be a place where anyone can go and see how we're doing against plan and how each of those assumptions in the plan are how we're performing against those and not have to question, is this updated or has the data synced? When I say real time, I mean real time. And you want those early warning signals about the drivers of the assumptions in the plan or of things like your sales cycle, right?

14:54 You want the early warnings around the things that could be causing sales cycles to stretch out, for example. So it's all got to be in real time, and it's a challenge for sure. It's a huge challenge. I know it as an operator in RevOps before. It's very, very difficult to get the level of detail and the volume of data that's really required. And I can give some examples for people listening. If you're looking at the metrics you need to be looking at, you need to be looking at production of close ones, sales qualified leads, marketing qualified leads.

15:33 You're going to want to look at the funnel metrics across the entire organization, conversion rate cycles, then you're going to want to segment that 20 to 30 different ways. Enterprise is going to run different than SMB. Your region in EMEA is going to run different than your region in North America. You have different product lines. You have different service centers. You need to be able to slice that data in all of the meaningful ways that are relevant to your business. And to do that in real time is, I mean, I'll just say it, it's nearly impossible if you don't have the right tooling.

16:12 I think it'd be really great if you could share, you know, this is why I was excited to talk to you about this topic because I'm sure this pain that you have felt that I have felt was a large inspiration for the development of QFlow. And I'd love to hear the origin story of QFlow and then also hear what you're working on today and what this could look like in the future for those RevOps 2.0 teams. Awesome. Yeah, we started QFlow. So both my co-founder and I have backgrounds in finance and BizOps. I did a stint in marketing, which I can tell you stories about later.

16:57 But the bottom line is that we're spending a lot of time not getting what we needed out of our sales ops and then out of RevOps teams. Among other things, around planning it and just managing the business. And so we would end up doing a lot of this work ourselves, interfacing with the data engineers, with the analysts, rewriting SQL queries. Usually to an unsatisfactory outcome because of the toolset that that traditional data stack uses and that we live within with our CRMs, right? Which are really important repositories of information, but that don't facilitate the type of planning that we're talking about today.

17:50 So we started QFlow. We looked around. We saw that there were a bunch of tools that call themselves RevOps tools, but they're really sales tools or sales management tools. And no one had built something that just worked out of the box for RevOps. And so we've built a go-to-market analytics platform for RevOps 2.0. It doesn't rely on the traditional data stack. It builds all of your go-to-market stats within 30 minutes of sign up. Gives you a rich view into the various performance drivers for those stats. And then, of course, there's a modeling component that allows you to understand where you could end up, two, three, four quarters from now.

18:42 What we're working on now, I mean, what everyone's working on now, we've built some generative AI in the product to automate some of the things that RevOps spends time on that is just time consuming, right? Interpreting charts, writing the weekly update email that goes out, explaining which deals pushed, which deals got pulled in, where we sit for the quarter. And we've got some good stuff in the pipeline that will allow people to use chat to interface with our product. So imagine just being able to log in, tap a button on your keyboard and ask Qflow how qualified pipeline is looking compared to plan and getting a plain text response back.

19:46 So, yeah, I think that answers your question. Yeah, so when the CFO is asking you a question about what's going on, you can just forward it to Qflow and drum up the answer for you. That's right. I mean, yeah, I mean, seriously. That's the idea. You know, what we see is generally, we did a Q1 customer survey. And what we saw was that we were able to free up 28% on average of RevOps analyst time to work on higher order problems within the business. And so that's something we're pretty proud of. We think with the addition of the generative AI, that number can certainly be closer to 40 or 50%.

20:38 And so what excites me is just imagining what kind of things are possible for companies out there when we can achieve those types of productivity gains and have these insights at our fingertips. Yeah, and I really like that you're developing technology for RevOps teams because there really isn't a lot out there. That's specifically for RevOps. Like you mentioned, there's a lot of tools that RevOps has to go implement on behalf of other departments to help them be more productive, but to get the things done that RevOps teams need to get done every day and just have the intelligence to lead the organization.

21:20 There's not a lot of solutions for that. So I really, as a RevOps professional, I appreciate the work you're doing in the space and I'm really excited for how it's going to empower teams to just do so much more. Well, not to make it a complete love fest, Anthony, but we see some of the work that you guys do with your clients and you guys fall into that RevOps 2.0 category. So we appreciate you guys. Yeah, no, I appreciate that. A lot of time being a RevOps 1.0 person, so that's what you can eventually stack up to do it the right way.

22:06 So just to wrap it up and conclude, RevOps 1.0, it's not a bad place to be and it's good that you're making the investment, making sure that you're putting together a team that looks at the organization holistically is important. But in order to really get the benefits and the power out of the function, one of the best ways to do that is to be part of the planning process if not leading the planning process and don't make it an annual retreat.

22:38 Make it a true closed loop process that you're monitoring in real time, reviewing regularly and then adjusting as needed because I think as people can see this year, a couple months, the whole world can change. So if you're just going to stick to the plan that you set in September of last year, you're definitely not being agile enough. So, Alex, any closing thoughts for people listening? I know if people are interested in QFlow, I hope they can reach out to you directly and get some more information. I hope we get to do some more discussions together as well.

23:18 No, I'd love to be back. Yeah, you can find us at qflow.ai, ping me on LinkedIn. Even if you just want to chat, I'm around. And yeah, I look forward, I can think of probably 13 different topics off the top of my head, Anthony, that we could riff on for a future podcast. I'm going to develop a few for us in the future. We'll just read them off. Okay. Thank you, Alex. Thanks, Anthony. Thank you for listening to this episode. If you like the discussion, please like, share, and subscribe to wherever you listen to podcasts so you never miss a new episode.