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About the podcast
The Digital Utopia Podcast is for SMB Marketers and Business Leaders looking to align their Marketing, Sales, and Service departments so they’re part of one powerhouse growth team.
Each episode will dive into the strategies, philosophies, and tools that will change your approach to organizational growth, give you renewed focus and clarity, and allow you to build a brand that not only helps you stand out—but win.
The Digital Utopia Podcast is produced by Digitopia and hosted by Frank Cowell and Joseph Freeman.
Episode transcription
Frank
Hey, gang. Welcome to the digital utopia podcast episode 24. I'm your host, Frank Cowell, I'm joined by my co host,
Joe
Joseph Freeman,
Frank
Joe, so we're continuing our theme of getting hyper specific. And it's one of our core philosophies. By the way, we're getting hyper specific on the shows, and we're addressing one question at a time, which I'm super excited about our last episode, we were actually able to have a really deep conversation around one question. So I'm excited about what this episode is going to bring.
Joe
Yes, me, too. So the question of the day is who owns rev ops? And we talked a little bit about this on a previous episode, and we're going to address that as well. But but there's kind of a big question mark here, because rev ops really is an emerging term. It's it's not necessarily a brand new concept, but people are starting to talk about it in a way that is a little bit more cohesive.
Frank
Yeah, it's becoming a unique business function, just like the core functions you already have in your business of marketing, sales, operations, admin and finance. Right? Right. Those are the core business functions, it's truly becoming its own business function
Joe
it is and now more than ever, you have the data to support it, right? Most companies have some sort of analytics plus. So they've got a lot of data coming in, maybe they don't know what to do with it. But it's coming in, it's being stored somewhere, there software to connect the dots between the across the whole lifecycle stage of a client. And so now is the time to really be jumping in if you haven't already explored what revox is, you really need to do your homework, you need to check it out. And today, we're gonna talk about who owns rev ops? Yeah, him. Recently, there was a report that came out from lean data and sales hacker. And they gave us some interesting numbers. They had sent out a poll and asked companies, I think they had 2,462. I don't think that I'm reading it, I'm literally reading it 2,462 participants in the survey. And these, these participants kind of outlined who their company was owning rev ops. Right? Yeah. So let's break this down. Let's talk about the numbers here.
Frank
Yeah. The state of revenue operations, is that what it is right? So for you, if you're here today, and you're listening, if you wanted to look it up is called state of revenue operations. So what's interesting is I kind of look at this report and the finding on this particular question. And while they identify, let's call it seven different groups, I kind of see it as three buckets. And so let's talk about it today in those three buckets. And so the first bucket, that is the biggest bucket of respondents was 26%. Ish, identified this, the chief revenue officer, or CR O, as being the owner of rev ops are revenue operations within the business. And I think if we look at this, I don't think that's too surprising, you know, to see that the, you know, CRM, CRM owns revenue operations, I think in these businesses, when you do have someone owning this, I think the the interesting thing is this person definitely needs to be their strategic leader. But I wouldn't expect this role to be the tactical execution person, right. And so this person is going to be heavy on strategy, and heavy on analysis. In some organizations, it's purely analysis, right. And they just deliver that data and information. It's it's really more of an analyst role. But I think if you look into doing revenue operations, right, analysis, and the analyst function is critical. But there's a go to market, there's now do something with the bottleneck that you've discovered. And that doing something that strategy is a critical component isn't enough to just say, hey, I've got this really interesting slice of data that I've been able to find and share that this role really needs to kind of do more than that. And they need to drive strategic direction on what to do with that.
Joe
Yeah. Now the data here doesn't break down to, you know, say exactly what types of companies were pulled. But my guess is, if a quarter of the companies say it's their CRM, these are some pretty big companies, because CRL is really, I think, has been viewed as a nice to have for a lot of companies. And we're talking about a salary range that is already pretty high for a CRL. And on top of that, you didn't have to spend money on software and implementation, like you just said, and so the entire function becomes pretty expensive. Yeah. So my guess is that these are probably enterprise level companies who are reporting that a CFO truly owns their rev ops and good for them, because that's actually kind of the Mecca. That's where you want to land at some point. Right,
Frank
that's necessary. You mentioned something I think it's important to note is that you know, whenever you're ready to establish a the leader of a given function in your business, maybe you're you're growing and you're just now ready to define a head of admin, right? We call it Head of culture, what if you're ready to now just define Head of Marketing for the first time, it's important to know when you're ready to place these heads, that that that opens Pandora's box, you know, they're your investment in that one person is just the beginning, because by definition, by default, someone who's at that level who can drive strategic thinking of an area and strategic decision making, by default, they're also not the Dewar, they're not the executioner. And so you the moment you place them, you might as well double the investment or triple the investment, because there are going to be as you mentioned, there's going to be software's there's going to be vendors, there are going to be hires that you make, they're going to be things that have to happen as a result of what this person does affects one of the worst things you can do is hire a head of one of these functions, and then not give them an additional budget to do these things like software and hires and work with outside outside firms and whatnot. Because they're just, they're not going to be able to do both, they'll be able to be strategic and execute at the same time.
Joe
So if you're at the level where you are ready to hire a CFO, then good for you. That's awesome. I think, you know, a lot of what we talk about on the show might not be quite for you, even though there's a lot of strategies and a lot of philosophies that you should adopt. And if you're a CRM, you shouldn't be listening to us. Because exactly, we think we know what we're talking
Frank
about, especially because the point we just made that or I just made this person largely as an analyst in many firms, but they need to start picking up the strategy chops. Yep.
Joe
So let's move on to the next couple of numbers that we have here. So we have the CEO and the CEO, they are separate metrics. Here, we have one at about 20%, and one and about 17%. But I think for the purpose of this conversation, we're going to lump them together, because CEO and CEO at you know, five to $20 million business. While they could be two separate roles in lots of businesses, they serve overlapping functions, even
Frank
if they are two separate roles. If you look at the sentiment of what's happening, when one of those two is owning it, it's the same sentiment, it's a five to $20 million, kind of kind of company, those numbers aren't meant to be exactly those, but the sentiment is around that size company, whether one owns it or the other owns it. They're not at a size where they can have a separate CRM, generally speaking. So when we look at that, I think one of the interesting things to point out on this report is there's a CFO at around 11% and change. And I have an interesting takeaway here. I think what ends up happening is at that size, where the CEO slash CEO owns the Rev ops function, and they start to realize, Oh, this is a thing, like bringing marketing sales and service together, and aligning them on their process, aligning them on their platform and aligning the functions. That's like a whole thing above and beyond how I'm used to managing the business, and so becomes overwhelming, which is why people hire CEOs. But at this level, one, you're probably not ready for that investment. And two, I don't think you should farm this out beyond the CEO, CEO function at this point, I think that those roles need to stay really close to this.
Joe
I think that's a good point really close. It's those people that have generally been with the company from the start, or from the, you know, close to the start. So they know the customer as well. Yeah, they know the numbers. Well, they know the nuances and they know what's implied
Frank
differentiation in the marketplace, all that stuff.
Joe
Right. So it is really probably important that these people stay kind of at the head, but they probably
Frank
need help, they need help. And that's why that's my prediction why we're seeing the CFO own it in some cases, because what ends up happening is they realize it's a ton of work. And so in those cases, I said I kind of see that as being, I don't wanna say pawned off but kind of pawned off to the CFO, because it is overwhelming. Now, here's what I would suggest to you is, I've come across a lot of really great CFOs in my time, but CFOs typically take a reductionist approach to the financials, meaning Where can they cut? Hmm, and the good CFOs the really strong CFOs take an expansionist visionary approach, how can we expand. And so in my opinion, the danger in just giving this fully to your CFO, is that they will take a reductionist approach, and not look to see where you can step on the gas.
Joe
And here's another thing, they're they're probably missing some sales acumen in terms of like how to make a sale, right? They're probably missing some marketing strategies and tactics. They don't know how to do that, right, their numbers and their analysis. And they're certainly, in my experience, they're certainly missing some of the delight elements, right? Some of the magic that you need to make a customer experience what it should be to get them to a fan. A CFO is just not really built for that they're built for the numbers and the logic and really making sure that everything is dialed in. But there's a lot of in between that needs to happen from a revenue operation standpoint to make sure that customers are moving through
Frank
I think you bring up a really great point. In fact, what's coming to mind for me right now, as you That is I almost think that when, when this is kind of given to the CFO, it's almost like a poor man's CRL approach, right? It's, it's like that, well, we really can't afford a separate hire CRM. So we've got one in our CFO. And while they can do the analysis part, they for sure can't especially good ones, they'll slice and dice the data and show you things about your data that you didn't know before. And that's good, like a strong CFO will do that.
Joe
And you have to have that certain that part of RevOps
Frank
Oh, for sure, yeah. But the part they're going to miss is then the strategy on how you're going to go to market and address those bottlenecks and those opportunities, how you're going to create delight, how you're going to create that magic, as you mentioned, how you're going to create alignment, for that customer experience. That's the part that will be absolutely sorely missing. But but I do think, in your organization, if you if you know, you can't afford to hire additional people to help, even outside firms, the CFO can be a partner, but don't farm it fully out to that person, make sure they have marching orders that they're going to provide analysis across the entire customer lifecycle. And they're responsible for gathering that data, and exposing it in near time getting it dashboard, but they are not the strategic lead on that. If you're at that size, CEO CEO still needs to be the strategic lead. And if you need help, knowing what to do, and what the ideas are, and how to engage on those bottlenecks in opportunities, that's where you might work with an outside firm, and start to bring those those talents and skills, bring into our strategy, bring
Joe
in some more implementation, correct? Yes, the analysis can be done probably in house at that point. But yeah, that's a great point. So CROs was about 26%. We group CEOs and CEOs to combine into about 37% CFOs represented 11 ish percent on this report. And there's one other group here, right, it's the it's the CSOs, so the sales team, the CMOS, the marketing team, and this other kind of what it says other, which represent collectively, about 25% of this, yeah, this data here. So what about this other sections, sales team and marketing team? What do you think about that?
Frank
Yeah, before I talk about that, just to recap what we said, If you add those three together, you get about 48%. If you add the CFO in there, I kind of think that's one general group, and they're handling it in different ways.
Joe
Though, you're putting CFO in with this third group, no
Frank
doubt there No, with the previous group, what I'm saying is, if you add those together, you get 48%. And to me, I think it's kind of the same group, and they're just choosing the handle at different ways. in one pot, one scenario is the CEO, CEO, COO, CFO. And so I think, as we mentioned, just to emphasize, this is probably where the bulk of our audience is at is you're in that group. So we're going to recap this, you know, when we get back, but I just wanted to point that out that that's close to half of the respondents are in that area where they're trying to figure out like, hot potato, who's supposed to do this, right, what's a good point. And then the other part of the hot potato is what you just pointed out, there's the kind of just this other that's other sales and marketing. And that's 25%. And I think that's really indicative of the smaller companies, who really, you know, you can't afford to hire anyone else, everyone's stretched thin. And these functions look and smell like they're supposed to be doing some of the things that are talked about tactically when it comes to DevOps, because a lot of frankly, a lot of the skills happen to fall in marketing. No, they happen to definitely do, right. A lot of your tactical things you're supposed to do are in
Joe
there to really operationalize it well to analyze it CFO is great for that even the CEO and COO are great for that, because they're really close to the business to operationalize actually doing the tactics. It's definitely more on the marketing side of the house, at least in terms of who innately has those skills. And we've even mentioned that I think on previous episodes, that small businesses, it's likely that your marketing team or marketing person is going to take a huge hand in leading this potentially. It's not the best option because there's a whole bunch more that goes into it than just sending out emails and automating workflows or shell ads. Right. There's a lot more than that. Right. But, but certainly, those are a skill set that has to be there. If you're going to truly operationalize This, this, you know, revenue conversation.
Frank
Yeah, that's really interesting is even when an organization and I would encourage the CEOs, you know, that are probably more analytical in nature as they start to adopt more strategy, making friends with the head of marketing, the head of sales, the head of service, that of operations, right, like making friends with those people and really digging into their capabilities because those capabilities need to be leveraged, especially the marketing team, because who's going to do research? area and the company is used to doing research, marketing, okay, who's going to do list segmentation now to start to figure out how we can address this bottleneck? Well, who's used to doing less segmentation, marketing, okay, who's going to develop an offer and a message and a go to market marketing, right? So you're going to lean on your marketing Team at no matter what size you're going to lean on your marketing team a lot, because just the tactical implementation, it happens to land in their area where they're the ones who roll up their sleeves and implement a lot of the things. They takes advantage of their skills, I should say, more so than any other area. Well,
Joe
and I want to stop you right there. Because that hits on what I think is one of the biggest themes in rev ops is, you know, the question of the hours who owns rev ops. And there should be somebody who owns it in terms of making sure that everybody's doing what they're supposed to be doing. But the reality is, is the entire company needs to be involved in rev ops. Yeah, everybody has a role to play, and everybody needs to understand what's going on at every single step of the way. So that that client experience is what it should be. So that on the other end of it, you can be, you know, pumping out the dollars in a very predictable way.
Frank
Yeah, I mean, if we just get to the very basic sentiment of it, you create that alignment. So that way, at the end, you have that kind of flywheel you kind of have that like feedback mechanism built into the business to where it kind of helps you build upon itself. And you can't get to that build upon itself. Point. If you don't have momentum, you can't create momentum, if you don't have everyone aligned on the same page and joining in on the cause. You just it's not going to happen. Yeah, it's everybody. So today's world is way too chaotic, way too hectic. You and your team just deals with way too much information, way too many tools. You You have no choice today. But to tame the beast, that is the technology, the information and you know, the the competitors that pop up on the scene everyday and all the things you have to deal with.
Joe
Right. So Well, everyone has to be involved, we still need to answer the question who owns rev ops, right? And so we talked about these three big groups that the CRO, the chief revenue officer, we talked about the CEO, COO, CFO group, correct, right. And then the other group, which was sales, marketing, and other are right, who should own it.
Frank
Okay, so let's break those, let's actually go with those three groups. And I think we should make a suggestion. Even, let's let's even be open to having our listeners challenge us on this recommendation here. But I think we're still very early in this conversation of revenue operations, that it might as well be us who helps make a suggestion and start going with it and see how it works for you. And certainly, we work with a lot of organizations and deal with a lot of executives to be able to make this kind of recommendation. So I'm going to suggest that at the CRL level, you need to be about 20 million plus,
Joe
even to afford that
Frank
roll to afford it. And some companies may be at 10 million might afford this right? They might afford it. But I would suggest that until you get to that point, the next crowd we're going to talk about really needs to be more closely involved in truly owning it. Because before you start to give this up to somebody else, you want to have a history of having it dialed in and know what works and what doesn't work. You need to know that about your business, right? And I would suggest that, you know, for any area that you're going to bring in new talent, a new head of x, you should, you should know what works, you should have a good sense of what the general direction is. Now, if you're going to hire someone in who's like the rock star, the guru, and they're going to tell you because they've been there done that, that's fine. Just know, just because they've done that before, doesn't mean they're going to have the same success in your business the next time and just know it's a gamble. It always is game, I can't tell you how many companies I've come across where the higher the Rockstar head of sales, and they're now ready to graduate to that and like someone truly owns it, well, they haven't figured out like what crank sales for themselves already, then you're going to it's going to be a gamble, even if that person has a great track record, because you're inserting them into a new situation, new product, new situation. Same with CRM, right? Like I think you should have a good handle on going through the paces of knowing what works. So 20 million plus, I think that's a good point, right around there, get yourself a dedicated CRM, and then they should probably either have a budget for their own staff and their own, you know, resources, or a budget to then work with an outside firm that becomes a consultative guiding partner,
Joe
or an implementation probably to
Frank
strategy and implementation, right, because that person is probably most likely going to be heavy on the analysis, as we mentioned. So 20 million plus, then you get to that next group, where it needs to be owned by the CEO, CEO, and that one of those two needs to own it. And that's going to be about your five to 20 million mark. Okay, they need to own it. And when the CFO is in the picture, I think they can be a support to it, but they don't think they should own it. I think they're a support and they can provide that financial analysis part. And then in that size range, you're probably going to have to either hire some additional people, most likely your best bet though, is to work with a firm that can bring several skill sets for the same price of hiring, some additional help. And so that's helped with strategy and implementation as human
Joe
plus a firm brings, you know all of the experience across many different companies and try and choose strategies because at this level, this is not your core focus, you are not staying up all night long learning about rev Ops, you are not trying and failing. But a farm would be on your behalf. Right?
Frank
Yeah, exactly, exactly. And then just the tactical stuff too, there's just you have to go through the paces on the tactical stuff, because to your point, like so much of it doesn't work because the market is always shifting informations. Always shift, platforms are always shifting. So so much of it is just needing to go through the paces regularly. It's, it's a lot like why they call like a doctor's business of practice. Because it's the idea that you're all practicing medicine, this, you're always running through the paces. Same thing with marketing, and some of the activities that we're talking about, you have to be running through the paces regularly. So that group five to 20 million owned by the CEO or the CEO, or if you have a few call that really GM, whatever that second command is, and then use your CFO as a partner to this for the analysis. If you don't really have that kind of CFO relationship, and they really don't have time to this, then the firm can provide both the analysis to strategy and implementation support, then we get to that final third group where you're like under 5 million still needs to be owned by whoever the head of businesses right still need to be owned by whoever the owner of the business is. But what you're probably most likely going to have to have these three little sub bullets here, these sub categories, which is sales, marketing, and other and other you're probably going to need to lean on marketing the most,
Joe
I think so
Frank
yeah, because most of the tactical things you would do, as we mentioned a moment ago, are going to leverage the marketing skill sets. for research, analysis, segmentation, messaging, marketers are used to those kinds of activities. And so you're probably going to lean on your marketing department heavily. But if you're the owner of the business, it's you own it. Really lean and pair up with marketing, get alignment with your sales team, right. So you know, you don't have just you and your marketer, like throwing things shoving things over to sales, like get on the same page,
Joe
I would also say at 5 million and below, generally companies don't have enough volume to make it too much for a marketer to handle. Yes, right in terms of leads coming in in terms of qualified in terms of opportunities, the sales and marketing teams, even if it's just one person each or maybe one person total, usually not enough volume to overwhelm them. And that that that point,
Frank
I would also bring up, you bring up a really interesting point, I want to remind people, there isn't enough volume at that size, also to where these activities are going to necessarily like hockey stick your business, right? There's something interesting that happens when you take these same efforts, like you can take the exact same revenue operations effort applied to a $5 million business, but apply to a $10 million dollar business, the $10 million business is going to see much more fruit because of leverage. The $10 million business has more clients, it has more awareness, it has more going on. So when you apply these principles and you apply the work, you just get more out of it. That's just the way it is we you know, I've seen that as I've run, you know, Business Management frameworks. When I ran that when our business was really small. And with the same effort when the business is much bigger, you just get more fruit? No, it's the same level of effort, right? Like the amount of sweat, so to speak. And the expense is roughly the same. But you just get way more output because you have leverage. So don't be discouraged if you're under 5 million. Don't be discouraged if you do this and you're like God dammit, all the hell like we did this. And you know, we only had a $50,000 increase to our year $100,000 increase year, celebrate that that's okay. It's going to it's going to snowball it's going to build upon itself and the longer you do it, the better you'll get. And if they're just good muscles to develop, because as you have that skill set as you get to 10 million and 20 million, wow, you're going to be an amazing organization. So don't get discouraged. build those muscles now and go through the paces and diligent. So hopefully that was helpful today. I really enjoyed this. Who owns rev ops. Glad we could cover that conversation. If you disagree with anything we said. Give us a shout. Let us know what you think like subscribe, give us some feedback down below and we will talk to you next episode.
