Rise of the Sales Operations Function
7/27/10
Sales costs are outpacing revenue growth, sales organizations are increasing in complexity, and IT buyers continue to indicate that sales reps are out of touch with their needs. What actions should sales executives take in response to this difficult environment? One of your first steps should be to expand the roles and responsibilities of your sales operations (SO) team. This team’s responsibilities should no longer be limited to the more tactical roles of sales IT maintenance, order management and sales administration. If you’re striving to create a best-in-class sales organization, then your SO team must be in a position to drive productivity changes across your key process areas, taking on a more strategic role.
Some starting points for enabling the rise of your sales operations team include addressing the following questions:
- What should sales operations be responsible for?
IDC defines the sales operations function as follows: Global and local sales staff responsible for developing and orchestrating the processes and systems required to enable an efficient and effective sales organization: strategic planning, financial management, sales performance measurement, sales infrastructure, marketing and sales alignment, and overall sales excellence. The sales operations function encompasses: Sales strategy and planning, sales forecasting, sales analytics, sales compensation, sales enablement, quote-to-order sales operations and sales automation infrastructure
- How big should my sales operations team be? IDC resource allocation guidance is for total SO staff to represent approximately 10-15% of total sales staff, with centralized SO staff representing approximately 1/4 to 1/3 of total SO staff.
- How do I determine where to start in transitioning my current SO team? Assess your team’s current gaps and weaknesses, which will provide valuable information toward developing the subsequent strategy for improvement. Clients of IDC’s Sales Advisory Service can leverage IDC’s Sales Operations Maturity Matrix to aid this process, as well as the following figure.
- What’s the ideal organizational structure for a global SO team? My typical consultative answer would be, ‘it depends’; but let’s get a bit more prescriptive than that. The success of the next-generation SO team will depend upon establishing a center of excellence organizational structure. A few key facets of this team include establishing a global VP of sales operations reporting to the global sales executive, a global SO team driving consistent process and technology changes across the organization, and alignment with SO teams and other internal groups across the world collaborating on improved sales productivity.
- Does my current SO team have the skill-sets and competencies to be more strategic? The SO team skill sets and competencies must be improved to enable the transition to more of a strategic than a tactical role. In addition to developing the ability to improve key processes, the SO team must also be in a position to spearhead next-generation technologies that will be key enablers of improved sales productivity (e.g., automation of sales enablement and customer intelligence for sales).
- How do I measure the impact of my sales operations team on sales productivity? Establish a clear set of objectives and quantitative and qualitative metrics to assess your SO team’s impact on the sales organization. Leverage benchmarks data from IDC’s Sales Productivity study to aid this process. (Contact me at mgerard@idc.com to complete our 2010 survey and get access to industry-level productivity benchmarks data)
The sales operations team must be the key driver and catalyst for increased productivity across the sales organization, setting the vision for its future and maintaining the path toward this vision. However, significant organizational and structural changes are required with sales operations teams to achieve this goal. With the right strategy and individuals in place, sales operations teams have the potential to be the catalyst for establishing a best-in-class, agile sales organization.
