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.

SE Ops: Sales Ops for the Sales Engineering team

Earlier this year, a fellow Modern Sales Pro asked what a Sales Ops-style role for a Sales Engineering team might look like.

Shortly after sending my thoughts on the topic, Stephen Morse, former VP Sales Engineering at Salesforce and current VP of WW Field Engineering for Algolia, shot back to say my insights were spot-on. With kudos from such an experienced SE executive in my corner, I thought I’d share so more Rev Ops pros might benefit.

Operationalizing our SE and Support teams was what I first spun up at Zerto, and ran with for roughly six months, as a way of getting leadership on-board with a formal Sales Ops practice.

My pitch to our head of Sales at the time was this: “My goal is to take everything that you’ve said has made me great at SE & SE leadership roles, add all the lessons learned from working with and through Support, define ‘successful SE’ and ‘successful Support Rep’, and then crank-out successful sales and support teams.”

Sales Ops, Marketing Ops, SE Ops… they’re all GTM focus areas of the same coin:

  • Sales Ops drives sales velocity through salespeople
  • Marketing Ops drives sales velocity through marketers
  • SE Ops drives sales velocity through SEs
  • Constantly improving sales velocity drives revenue

In my case of running this for all of pre- and post-sales plus technical support, the key goals for me were (i) building scalable systems for recruiting & onboarding along with (ii) improving alignment with sales. This meant owning areas like capacity and compensation planning, enablement design & delivery, program and process creation, GTM planning, identifying and reporting a variety of metrics up and/or over, etc.

If the above sounds like what Sales Operations does for Sales, I’ll repeat: these are GTM focus areas of the same coin.

To provide additional context and ammo, below are several key points from the job description I wrote when formalizing this to the business:

  • Create and execute globally-standardized processes, programs, and tools that facilitate efficient operations, effective execution, and improved management insight
  • Develop annual budgets, hiring and capacity plans, comp plans, and other operational plans
  • Build and launch scalable processes that drive pre-sales alignment, Professional Services utilization, and Support CSAT targets
  • Own process improvement across pre-sales, post-sales, and support
  • Create programs which drive continuous expansion and growth out of large customers and OEM relationships
  • Develop the KPIs, metrics, and operating rhythm to drive the scale-up/scale-out capability of our tech staff managers
  • Build and launch new customer and partner programs that improve access to and engagement with our pre- and post-sales teams
  • Work with customers and partners to identify areas for improvement in our technical operations, product development and launch, value-add services, etc.

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).