The Journey to Revenue Excellence Playbook

MAY NOT BE REPRODUCED WITHOUT PERMISSION

The Revenue Room™ helps revenue-focused leaders with transformative thinking and organizational change. Developed by H2K Labs, this proprietary framework is designed to revolutionize revenue organizations that deal with high levels of data complexity. This transformation is vital for media, event organizers, business information providers, marketplaces, and marketing agencies.

The Journey to Revenue Excellence Playbook

The Final Returns Are Too Great to Ignore
Why Now?
Signs You Need to Modernize Your Revenue Strategy
Revenue Kaizen
Revenue As Your Most Critical Business Process
The Revenue Room^TMFramework
The Revenue Room^TMOperating Principles
The Revenue Room^TMCapabilities Framework

The Final Returns are Too Great to Ignore

Modernizing your revenue strategy is about more than remaining competitive: it’s about remaining viable in an increasingly competitive world. Companies that fail to evolve their sales approach risk falling far behind.

Sales organizations are changing to adapt to buyer behavior. Gartner predicts that 60% of B2B sales organizations will transition from experience and intuition-based selling to data-driven selling by 2025.¹

Teams transitioning to data-driven revenue strategies are seeing financial returns that are simply too great to ignore. Research from Forrester, Boston Consulting Group, and McKinsey detail how impactful an aligned RevOps strategy focused on data is:

10-20% increase in sales productivity²
15-20% increase in customer satisfaction²
30% reduction in GTM expenses²
19% faster growth³
15% higher profitability³
71% improved stock performance⁴
15-20% increase in EBITDA⁵

Why Now?

Today’s business landscape looks fundamentally different than it did even a few years ago. New competitors have entered the market while established ones are reinventing themselves.

Changing Buyer Behavior

Buying behavior has changed radically. By 2025, 80% of B2B sales interactions between suppliers and buyers will occur in digital channels.¹Three-quarters of B2B buyers prefer a rep-free experience.⁶

Sales teams are no longer the primary knowledge source for buyers. There is a vast amount of knowledge online and buyers come armed with digital information. The journey itself no longer progresses in a linear fashion between stages — buyers move simultaneously across stages during the entire buying process.

Information gathering has also changed from siloed purchasing to ever-expanding buyer’s groups, each of which may be seeking different information. The average B2B buying group is made up of five to 11 stakeholders representing five distinct business functions.⁷

Data is key to meeting buyer demands. Customers today also expect hyper-personalization interactions and integrated experiences. Providing a consistent, omnichannel engagement strategy is crucial and only works with data-driven strategy optimizing revenue intelligence to align your marketing and sales teams.

Tough Economy/Inflation

Customers have always sought value at the lowest cost. In inflationary times and an uncertain economy, this has never been truer. Inefficient sales processes waste money. If you are unable to properly engage B2B buyers with the right information at the right time, you risk losing sales.

At the same time, there is increasing pressure from owners, investors, and boards. In turbulent markets, investors scrutinize performance and growth more critically.

Data as a Value Creator and Revenue Driver

Nearly eight in 10 executives in charge of data strategies say value creation and business growth are their most critical responsibilities, according to an Accenture and MIT survey.⁸ Increasingly, data has become the value creator to drive revenue.⁹

Transforming data into value is central to success, providing a single source of truth and democratizing data across the organization.

Signs You Need to Modernize Your Revenue Strategy

Do you need to modernize your revenue strategy? If you’re seeing any of these warning signs, there’s work to do.

Sales and Marketing

Missed Forecasts: Consistent discrepancies between projected and actual revenue, hindering accurate planning and decision-making.
Low Quota Attainment: Sales teams consistently falling short of assigned quotas, signaling a misalignment between targets and performance.
Concerning NRR/Churn: Increasing customer churn rates or declining Net Revenue Retention (NRR), indicating a need for enhanced customer retention strategies.
Category 5 Hurricanes: Inability to weather market disruptions or industry upheavals, emphasizing the necessity for a resilient and more adaptable revenue approach.
Finger Pointing: Blame games and lack of collaboration between sales, marketing, and other revenue-focused teams, hindering organizational unity and efficiency.
Revenue Leakage/Deal Slippage: Unexplained revenue losses or delays in closing deals, highlighting inefficiencies in sales execution and deal management.
Excel Hell: Overreliance on manual processes, especially Excel, for revenue forecasting, leading to higher error rates and reduced forecasting accuracy.
Low-Quality Revenue: A high proportion of deals resulting in dissatisfied customers or refunds, indicating a need for improved lead qualification and sales processes.

Data

Inefficiency in Data Management: Challenges in organizing and managing data efficiently, leading to operational inefficiencies and suboptimal decision-making — often without accurate data intelligence.
Missed Revenue Opportunities: Failure to capitalize on potential revenue streams due to inadequate utilization of available data insights.
Challenges in Key Data Metrics Extraction: Difficulties in extracting and leveraging essential metrics from data, hampering the ability to derive meaningful insights for strategic decision-making.

Recognizing and addressing these signs is pivotal in steering your organization toward a modernized and effective revenue strategy. The Revenue Room™ provides a comprehensive framework to tackle these challenges head-on, ensuring a resilient and growth-oriented approach.

Revenue Kaizen

What Is Revenue Kaizen?

Revenue kaizen is an incremental method to achieving improved revenue outcomes. In line with the broader principles of Kaizen, which focuses on continuous improvement, revenue kaizen emphasizes making small, continuous changes to enhance overall revenue performance.

Revenue Kaizen Benefits

Revenue kaizen features several key benefits to streamline operations and improve revenue generation.

Making Incremental Improvements

Focusing on small, manageable changes allows organizations to make continuous progress, with each improvement contributing to the overall enhancement of revenue outcomes over time.

Decreasing Waste by Eliminating Unnecessary Activities

Identifying and eliminating unnecessary or inefficient activities in revenue processes reduces waste, streamlining operations for greater efficiency.

Gaining Buy-In and Winning Over Resistance to Change

Incremental changes are often easier to digest for teams, fostering buy-in and overcoming resistance to broader changes. This collaborative approach ensures smoother transitions.

Iterating and Pivoting to Improve the Process

The iterative nature of revenue kaizen allows organizations to adapt and pivot as needed. Continuous evaluation and adjustment lead to refined processes that better align with evolving business needs.

Empowering Embedded Learning and Skills Development

The continuous improvement culture inherent in revenue kaizen empowers employees to engage in ongoing learning and skill development, fostering a dynamic and adaptable workforce.

Why Is Revenue Kaizen Important?

Achieving excellence is a continuous process and includes risk-taking, change management, and constant evaluation and iteration. With an understanding that performance improvement is a never-ending quest, companies can continue to refine their revenue strategy to improve profitability.

H2KLabs

Revenue As Your Most Critical Business Process

Many businesses view sales through the lens of outcomes and don’t treat revenue as a process to be managed efficiently.

Shifting this perspective is essential.

There needs to be a comprehensive framework to manage the entire sales process with a consolidated view. Companies formed through acquisition or decentralized organizations typically have fragmented and siloed sales organizations and processes. This creates significant challenges in controlling, measuring, scaling, and optimizing growth opportunities.

Data silos have become increasing challenges with the proliferation of Software as a Service (SaaS) tools. The average company can use more than 250 SaaS applications, which can create significant data disconnects.¹⁰ Disconnected data can lead to incomplete or inaccurate data — often leading to conflicting analysis and poor outcomes.

Siloed revenue organizations experience difficulty in controlling, measuring, scaling, and optimizing revenue goals leading to lost revenue, wallet share, and market share.

The Revenue Room^TMFramework

Refining your revenue process and creating continuous improvement is at the heart of the Revenue Room^TM Framework. By examining the four components of revenue as a business process, organizations can gain significant insight into operations and create dramatic improvement:

Revenue Operating Plan
Aligning Revenue-Critical Roles
Aligning KPIs and Outcomes
Standardization

Revenue Operating Plan

Implementing the revenue operating plan is essential, particularly in the B2B sector, as it establishes the foundation for a methodical and streamlined approach to revenue generation. By aligning products with customer needs and effectively engaging target segments, businesses guarantee the relevance and appeal of their offerings.

The execution phase, centered on managing the sales pipeline, employs data-driven strategies to optimize processes and mitigate revenue risks. Successful delivery is pivotal for meeting customer expectations, cultivating long-term value, and nurturing loyalty and retention.

In the expansion phase, the focus shifts to growing business within the existing customer base through essential strategies like upselling and cross-selling, ensuring sustainable growth. The ‘Rinse, Lather, Repeat’ step’s iterative nature, utilizing data for continuous refinement and scalability, maintains business agility and responsiveness to market changes.

The effective implementation of these steps results in a resilient, customer-centric revenue model that propels business success:

Build: Align products with customer needs and demands, ensuring future offerings, events, and media are aligned.
Engage: Generate demand within target segments and ensure alignment across marketing, business development, sales, and product teams. This stage is crucial for pipeline development and acceleration.
Execute: Optimize pipeline management for predictable closures. Utilize data for identifying risks and seizing opportunities while enabling sales leaders to provide real-time coaching and deal guidance.
Deliver: Commit to delivering value that exceeds customer expectations, using data to pinpoint product opportunities and unmet needs.
Expand: Focus on retaining and enlarging your client base through upselling and cross-selling within existing accounts.
Rinse, Lather, Repeat: Continually refine and scale processes using data-driven insights.

Aligning Revenue-Critical Roles

Implementing a phased approach to align revenue-critical roles is crucial, evolving through four distinct phases, gradually incorporating more departments into the alignment— from Sales and Customer Success to Marketing, Operations, and Product teams. Data remains pivotal, fostering collaborative, data-driven decision-making.

In the B2B information sector, revenue-critical roles encompass various departments, each uniquely contributing to the revenue stream, and must be aligned for success. Key roles include:

Sales

Directly sells products or services to customers, playing a crucial role in meeting sales targets, developing strategies, managing the sales team, and building key client relationships.

Sales Marketing

Focuses on creating and implementing marketing strategies to enhance brand recognition and generate leads for the sales team. Involves market research, campaign creation, digital marketing, and tracking the effectiveness of marketing efforts.

Business Development

Identifies new business opportunities, partnerships, and markets, crucial for expanding the client base and finding new revenue streams. Overlaps with sales and marketing, although less common in B2B information sectors.

Customer Success & Operations

Ensures customer satisfaction and retention for recurring revenue and upselling opportunities. Includes roles in digital advertising operations, demand generation operations, event operations, subscription management, membership management, and more.

Revenue Operations

Oversees the integration and alignment of sales, marketing, and customer success operations. Crucial for streamlining processes, optimizing the sales funnel, and ensuring cohesive collaboration toward revenue goals.

Product

Oversees the development and lifecycle of a product, directly influencing its sales potential. In the B2B information sector, this involves building and sustaining audiences, curating relevant content, and enhancing user experience.

Finance

Plays a key role in revenue forecasting, budgeting, and financial analysis, providing insights into financial performance, cost control, and investment opportunities for strategic decision-making.

Each role contributes uniquely yet interconnects to drive sales, optimize marketing efforts, maintain customer relationships, and ensure the financial health and growth of the organization. This phased approach ensures a consistent commitment to revenue generation across diverse functional areas.

Aligning KPIs and Outcomes

Top-performing companies with aligned goals perform better. They are 67% more efficient at closing deals and see 200% higher revenue growth than those that are not aligned.^12,13 Alignment results in 38% higher win rates, 36% higher customer retention levels, and 24% faster revenue growth.^14,15

Alignment, however, requires a total commitment across an organization and connected systems to drive shared key performance indicators (KPIs) and outcomes. Measurement and tracking are key to uncovering impediments to performance and tracking the impact of incremental improvements.

Some of the KPIs and outcomes that are typically tracked in aligned organizations include:

Sales

New business acquisition
Logo retention and growth
Net revenue retention
Average annual contract size
Win rate
Quota attainment

Marketing

Low-impact revenue opportunity (LIRO) conversion to high-impact revenue opportunity (HIRO)
HIRO conversion mapped to pipeline stages
HIRO win rate
HIRO win rate cycle
Customer acquisition costs (CACs)

Customer Success

Customer satisfaction (CSAT) and net promoter (NPS) scores
Logo retention and growth
CSM generated HIROs (CSMSQLs)
Net revenue retention
Expansion win rate
Expansion win rate cycle
Customer lifetime value (CLV)

Operations

Customer satisfaction
Program performance
Contract performance
Logo retention and growth

Finance

Sales growth rate
Profit margins
Pricing optimization
Revenue concentration
Accounts receivable turnover

Product

Customer engagement
Customer feedback
Customer satisfaction
Product-led growth (PLG) metrics

Standardization

Standardization is an essential component for measurement, tracking, forecasting, and planning. Efficient and high-performing companies standardize processes, including:

Data and data governance
Revenue governance
Pipeline management
KPIs and measurements
Product offerings and presentations
User experience design
Pricing structures
Go to market (GTM) strategies
Customer journeys
Hiring
Onboarding, training, and upskilling

Standardization creates efficiencies. Continuous improvements remove roadblocks and generate regular refinements to improve performance.

The Revenue Room^TM Operating Principles

Revitalizing outdated, siloed sales practices and principles into a modern, data-driven center of revenue excellence requires an enterprise-wide approach. The Revenue Room^TMOperating Principles cover 10 areas.

1. It starts with leadership

Leadership needs to define and communicate a clear vision and mission for driving transformation and how it will help individual teams and the business be more successful. Communication needs to be ongoing and consistent.

2. Data fuels the journey

Harness the power of a single source of revenue truth to activate analytics, predictive insights, risk and opportunity identification, and embed data-driven decision-making in the daily flow of work

3. Define Metrics and KPIs

Establish clear, measurable objectives, and performance metrics to gauge the success of revenue initiatives.

4. Revenue Governance

Exercise control over all customer-facing, revenue-generating activities by establishing clear metrics, definitions, functional accountability and responsibility, and processes.

5. Collaboration and Cross-functional Integration

Align every revenue-critical employee across sales, marketing, finance, customer success, product, and operations to focus on the same goals. Collaborate on opportunity identification, acquisition, retention, and expansion.

6. Evolutionary Transformation

Transformation is an evolutionary process that takes place over time using a combination of continuous learning, experimentation, risk-taking, and a team sports mentality.

7. Forecasting as a Core Competency

Make predictive and prescriptive forecasting a core competency across:

Sales: How many deals you will close within a given period.
Revenue: The entire lifecycle of a paying customer.
Operations: Performance of product, contract, and margins.

8. Customer Obsession

Keep customers at the center of all revenue initiatives and revenue-critical functions. Gain deep understanding of both met and unmet needs, pain points, and buying behavior.

9. Transparency and Accountability

Transparency in revenue performance is crucial throughout the entire organization. It should encompass metrics that reflect actual performance and the influence of transformational changes.

10. The People in the Room

Some skills and roles require upskilling or reskilling. Others may require acquisition.

The Revenue Room^TM Capabilities Framework

In the current inflationary environment, revenue growth has emerged as a top priority. To sustain impact over time, companies must:

Retain and grow existing customers
Focus on high-quality revenue
Invest in capabilities building across all revenue-critical functions

At scale, capabilities building is at the top of the agenda and must incorporate key principles to do it well. They build off one another and gain strength over time.

H2K Labs

Conclusion

Elevating revenue to a pivotal business process extends beyond the adoption of new strategies or technologies. It requires a holistic transformation in how your business approaches revenue generation and an ongoing commitment to continuous improvement, standardization, and alignment across all departments.

By deploying the strategies in The Revenue Room^TMJourney to Excellence Playbook, you can establish revenue as a center of excellence for sustainable growth.

Contact the revenue growth experts at H2K Labs to learn more about how to maximize your revenue growth and profitability by overcoming complex data environments and resource constraints. H2K Labs empowers you with expert analysis, strategic development, meticulous execution planning, and cutting-edge platforms — accelerating revenue, minimizing waste, and enhancing margins.

Book a discovery call today and see how we can help you grow.

The Journey to Revenue Excellence Playbook

MAY NOT BE REPRODUCED WITHOUT PERMISSION