Five Steps for Understanding Your Revenue State
Through TeleTech’s Revenue Performance Assessment (RPA) process, our solution engineering team helps the cross-functional executive teams (within our client and prospect organizations) to see their revenue state more clearly. By breaking down the elusive “revenue engine” into its basic parts and then assessing the health of each of those parts, our prospects are better able to understand which sections of the sales organizations are strong and which parts might need a tune-up. When constructing our solutions, TeleTech’s Customer Growth Services division focuses on the areas that might need to be strengthened.
In addition to not testing the health of each component of the revenue engine, many companies do not have clear visibility into their true cost of revenue generation. At TeleTech, we use a basic ratio that compares expenses and revenue to help our prospects better understand how efficiently they are investing in their sales activities. By tallying the cost of the revenue engine (including selling, customer analysis, and marketing support for lead generation) TeleTechseeks to show our prospects what the cost is per every $1 in revenue. While a healthy E:R (expense-to-revenue) ratio varies based on industry and market factors, companies that are spending 60 cents or more to earn $1 in revenue generally can greatly benefit from TeleTech's best practices.
When diagnosing the health of your revenue state, consider these five primary areas:
1. Sales Process: The sales process is oftentimes organically created over time to address discrete market or corporate needs. TeleTech challenges our prospects to consider their existing process, including sales activities and lead tracking and metrics, and determine if it is capable of providing long-term customer value.
2. Sales Management Practices: Sales management is a unique competency with a strong heritage of best practice documentation. As organizations seek to hire, train, and manage a sales team, there needs to be a unique approach (and perhaps support team) that is focused on the revenue engine. While some of the characteristics that create good sales results are inherent within an individual, companies miss a huge opportunity for improvement when they fail to provide sales-specific training and development.
3. Data Management: As an activity- and metric-driven function that is closely measured by the finance team, sales organizations have lots of data: data about their pipeline and activities; customer data; conversion rates; and attrition numbers. Our prospects tell us that despite the oodles of data, they have very little information that can help them sell better.
4. Sales and Marketing Integration: The natural (and necessary) walls that corporations create between their different functions help protect the integrity of each function’s mission and keep that team focused on their specific goals. TeleTech challenges our prospects to examine that wall between the sales team and the marketing team to decide if there might be some benefit in creating a few more portals for easier passage between the two functions. By adopting “long-term customer value” as a mutual objective, organizations with closely aligned sales and marketing teams find the compatibility of each team makes the other stronger. For the sales team, there is great benefit in the segmentation and analytic abilities that exist in marketing, enabling them the support to turn data into information that better directs their sales activities. For the marketing team, there is great benefit in understanding which of their activities are having positive outcomes (either through new customer acquisition or via retention and growth of existing customers) in order to report their effectiveness.
5. Customer Analytics: Leveraging analytics to create informed customer segments, marketing campaigns, customer lifecycle management, and sales execution enablement is the next great frontier in sophisticated revenue management. Our clients are often halted in achieving their dream of analytics-informed decision making by the sheer difficulty of finding, housing, and then managing the necessary data. TeleTech's Analytic Multichannel Platform provides our clients and prospects the ability to lasso customer data into a single data warehouse (often the hardest part) and experience the benefits that customer analytics can have on the sales floor.
TeleTech is challenging our prospects to not fear the revenue engine. Instead, lift up the hood, take a look, and start asking questions. Like the engine in your car, each part of the revenue engine—no matter how small or basic—serves an important function that affects the overall effectiveness of the entire system. By understanding how each component should work, organizations can begin to evolve their revenue engine through fine tuning. For TeleTech, we have found great success in engaging our prospects in discussions about their operational best practices and financial cost structures. Through our Revenue Performance Assessment methodology, TeleTech seeks to create solutions that are both effective and innovative for our clients and our prospects, and earn a clean bill of health for the revenue engine.