Getting executive buy-in on expanding your Revenue Operations team

If you’re in Revenue Operations the chances are high that you wear fifty different hats. Fifty might be an understatement.

Before you lose your marbles and hit burn out, how can you go about asking for more people resources? The good news is you can make this a math problem.

By how much do you impact productivity and revenue? That’s X. If X is net +1 sales executive or more, you’re already paying for yourself.

Next, how much additional productivity-impacting work is on your plate? If it’s 100%, meaning you’ve got twice the work ahead of you than you’ll ever be able to output, a second “you” also pays for herself.

The articles below go into more detail and helped equip us to double the size of our team at Zerto.  

#1 is “When to Start and Scale Sales Operations?“, by VC, CEO, and multi-time CMO Dominique Levin.

Dominique’s formula for Sales Ops hiring is simple: you expand the team each time the aggregate productivity gain (%) of the number of quota carrying reps (#) is greater than or equal to 100%.

As Dominique writes, “if you’re delivering a 20% boost in productivity, and you have a 10 person team, then hiring another Sales Ops pro would give you a 2 FTE equivalent boost in productivity, meaning that you probably should have hired them a while ago.”

#2 “The Right Ratio of Sales Ops to Salespeople“, by the fantastic team at SellingBrew.

#3 “In the Best Sales Teams, About Half of the People Are in Support Roles“, by a team of sales pros turned partners at McKinsey.

Differences in AE/AM sales comp

A friend of mine asked about differences in customer acquisition cost (“CAC”) relative to new customer acquisition, upsell, and expansion. When I said there’s loads of material on why expansion CAC is less than new logo CAC with respect to marketing costs, he said what he was really interested in were differences in sales comp plans and their effect on CAC.

We narrowed our conversation down to the two comp plans of Account Executive, a role typically responsible for new customer acquisition, and Account Manager, a role typically responsible for upsell and expansion.

I’ve seen a handful of differences between AE & AM comp. Using an AE comp plan as a starting point, AM roles typically have:

  • 30-50% of AE on-target earnings (OTE)
  • 70-90% of AE quota
  • Less-aggressive OTE split with 60-70% going to base

Then there are different ratios in the sales units – e.g. all the people supporting the different sales roles. The AE:SE ratio may be 2:1 or 3:1 while I’ve seen as high as 8:1 for AMs. AE Managers might have 4-6 AEs while AM Managers may have as many as 8-10 AMs. All of this has a major impact on the cost of doing business (inclusive of CAC).