Understanding the B2B Revenue Engine

Dale Hursh June 27, 2019

We recently attended our client’s annual B2B Marketing conference in Austin, TX; Sirius Summit. Here is an overview of what they had to say about the Revenue Engine.

Revenue Engine

How is your revenue engine doing these days? Do you have a revenue engine? Do you know what a revenue engine is? According to Sirius Decisions only about 1/3 of B2B companies surveyed have a coherent, tangible and centralized Revenue Engine. That’s not a lot of RPM’s.

Developing and managing a revenue engine can provide very good return on your investment. The primary theme to consider as you explore getting started is: Alignment between the different teams involved. If you can’t start with agreement between all of the involved departments you will not get very far.

Why do it

Companies that have a coherent Revenue Engine report the following success metrics:

  • 19% faster revenue growth
  • 15% higher profits
  • 7x increased revenue growth over companies without a Revenue Engine
  • 7x improved stock performance

These are pretty compelling numbers and worth the effort to investigate how to improve your Revenue Engine.

Revenue growth is a ubiquitous goal of every company. If you think about it there are three ways you can grow revenue, in order of which has the biggest potential impact on the top line:

  • Your market can grow
  • You can become more competitive and efficient
  • You can better align your revenue engine

These are also listed in order of which is most difficult to achieve and resource intensive; meaning improving the alignment of your revenue engine requires the least effort and overall resources. So this fact, combined with the success metrics above, means that investing in better aligning your revenue engine is well worth the effort. Sirius used a great analogy to depict this:

  • Growing your market is like moving mountains
  • Becoming more competitive and efficient is shifting boulders
  • Better aligning your Revenue Engine is carrying stones

Where to start?

The first step is to get alignment across the critical departments and break down the common silos within an organization. Alignment needs to occur across these departments:

  • Marketing
  • Sales
  • Customer Success/services

Sirius’s survey showed that companies need to improve in integration across all three intersections of the above departments:

  1. Marketing and Sales
  2. Sales and Customer Success
  3. Marketing and Customer Success

Simply coming to agreement that these department need to be better integrated can be a daunting task by itself, then comes the work off actually integrating them.

A simple real world example of attempting to integrate two departments is sales and marketing trying to create a lead scoring model. For those of you who have attempted it it’s easy to understand how this apparently simple task can be very difficult to achieve. We have seen companies who work months just to come to agreement on this.

These departments must come to alignment on several key functions across three dimensions within the organization:

  • Dimension 1: Strategic
    • Vision
    • Goals
  • Dimension 2: Operational
    • Strategy
    • Planning
    • Infrastructure
    • Personnel
    • Data
    • Measurement
  • Dimension 3: Organizational
    • Priorities
    • Stakeholders
    • Interlocks

Breaking these out and outlining what needs to be achieved within each function can be defined as what Sirius calls the Revenue Operations Charter. This is a detailed outline of each function listed above. For example, under the Organizational Dimension the function Priorities (highlighted above) can be outlined as follows:

  • Revenue strategy and modeling
  • Revenue planning and budgeting
  • Revenue engine measurement
  • Revenue engine data management
  • Revenue infrastructure management
  • Revenue personnel management

The last thing to consider as you build your Revenue Engine is the implementation structure to use—in other words the organizational hierarchy. There are several options available. In some cases the Engine is managed by existing executives, the most common being COO, CSO or CMO. However the most successful use cases involve a centralized or semi-centralized hierarchy reporting to a CRO.

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Dale Hursh is CEO of SmartSearch Marketing with over 15 years of experience helping companies improve lead generation and lead acceleration through the full sales funnel. He has spoken at numerous search marketing and B2B Digital Marketing conferences around the world over the last 10 years.