There is a growing recognition within the sales industry that sales operations can play a critical role in improving overall sales performance. It is with this in mind that CSO Insights, the research arm of Miller Heiman Group, decided to study the area of sales operations in greater depth.
More than 300 participants from all over the world took part in the research and the findings have been published in the first annual CSO Insights Sales Operations Optimization Study. This blog post aims to draw attention to, and examine, some of the highlights and key findings from this year’s report.
1. Definition of Sales Operations
With the growing awareness of the importance of sales operations as a function, it is important to develop a clear understanding of what sales operations actually is, what the function actually does, and what kinds of elements it is responsible for. Therefore, one of the priorities of the new study was to define sales operations.
At present, CSO Insights’ running definition is as follows:
“A strategic function, designed to provide a platform for sales productivity and performance by providing integrated methods, processes, tools, technologies and analytics for the entire sales force and senior executives.”
Essentially, sales operations is concerned with designing and maintaining the sales system. Sales enablement then builds on this foundation, providing employee development, content services, tools, technology and other services designed to enable more valuable and relevant interactions with customers.
While this definition is likely to be revised over the coming years, in much the same way as our continually evolving definition of sales enablement, it provides a solid base to build from.
2. A Multifaceted Function
One of the things the study makes abundantly clear is that sales operations is a multifaceted function, with a vast number of business activities falling under its umbrella. To make these easier to understand, the study divides them into four different categories, as follows:
- Strategic Planning Support – This category covers activities like customer analysis, sales organisation structure and channel definition, as well as compensation modelling and territory modelling.
- Sales Performance Analysis – Included within this category are things like forecast and pipeline management, sales process definition and salesperson performance.
- Sales Readiness & Enablement – Activities within this group include enabling sales reps and sales consulting staff, employee development efforts, quote management, RFP and proposal management.
- Technology Management – This final sales operations area includes activities like sales tool management, CRM definition and update strategy, and technology change management.
At present, only 21.1 percent of organisations make use of a formal charter to set sales operations priorities and manage their sales operations strategy. With an improved understanding of exactly how much ground the function has to cover, more organisations are likely to follow suit in the years ahead.
3. The Tech Industry Leads the Way
A major finding of the study was that the majority of participants (63.9 percent) currently have a dedicated sales operations team or function in place. However, the technology industry is leading the way, with 80.5 percent of tech companies having a dedicated function. Across all other industries, this falls to 54.6 percent.
As the following graphic shows, 36.1 percent of organisations have sales operations responsibilities split between multiple teams, but 7.5 percent of those have plans to introduce a dedicated sales operations function.
Another clear trend that was established over the course of the study was a link between revenue and adoption of sales operations as its own function. There is a direct correlation between higher annual revenue and the percentage of companies within that revenue bracket that have a dedicated sales operations team in place.
4. Areas in Need of Improvement
Finally, one of the most interesting findings connected to the study was a list of priority areas for improvement over the next two years. The most important area for improvement is delivering key decision-making data to executives, with 59.6 percent of respondents calling this a high priority and 33.1 percent calling it a medium priority.
This is not a major surprise, as executives in the modern sales industry need to be more data-driven than ever, as sales continues to move from being seen as an art to being accepted as a science.
After that, the next priority is sales enablement. This is an interesting area, because, as seen in the CSO Insights 2017 Sales Enablement Optimization Study, the majority of organisations now have enablement as a separate function. Nevertheless, many still have enablement reporting to sales operations and large organisations, pulling in more than $1bn in annual revenue, are twice as likely to have this kind of system in place.
Enablement is about helping all customer-facing personnel – sales reps, sales consulting staff, etc. – and their managers to do their job more effectively. Even in businesses where sales enablement does not report to sales operations, the two functions must work closely together to improve performance and productivity.
The Final Word
Sales leaders are increasingly waking up to the importance of sales operations as a function and findings published in the CSO Insights 2018 Sales Operations Optimization Study provide valuable insights into the current state of the discipline and the areas that need to be focused on in the months and years ahead.
Many of the activities that fall within the remit of sales operations are covered in more depth at Miller Heiman Group’s various events, such as the upcoming 2018 Sales Enablement Summit in London on 8th November 2018. You can find out more about these events and register your attendance by clicking here.