Services Revenue Organization Development

Establishment Alignment Optimization

The establishment phase for the revenue organization is focused on laying a foundation that will be subsequently built on. This involves implementing core processes and systems, and developing the skills to execute them so that you have consistency. Core processes include tracking systems that provide visibility and insight. In designing tracking systems, a key distinction to keep in mind is the difference between formative and summative metrics. The purpose of formative metrics is to provide feedback about a process while it is ongoing so that its status can be monitored; summative metrics provide information about the output of a process. The key - but not exclusive - components of the establishment phase are listed below and subsequently further detailed:

It is important to note that the actual development process is not likely to proceed in the linear manner reflected in the model. In reality, their development is a concurrent and iterative process wherein decisions at one point may require you to revisit previous decisions. Cycling back is an expected characteristic of working with what is admittedly a complex and inter-connected process.

Assignment of Chief Revenue Officer:

A key early step in the establishment phase is to designate a Chief Revenue Officer (CRO) to lead the organization. Consistent with the  adage "when everyone is responsible, no one is responsible," best practices indicate that the CRO have ultimate responsiblity for the organization. Despite that, the internal governance structure of the revenue organization and it's relation to the rest of the company is open to many options. Which is best for you will be a function of the size and complexity of your company, and a reflection of your corporate culture. Also, having a CRO does not necessarily mean you have to create a new position. Some do, and there is a good argument for it. But many do not; they just attach the CRO duties to an existing position, such as CEO, VP of Sales, CFO, etc. Again, what makes sense for your company is a function of your size, complexity, current structure, etc. What is important is that the CRO have the personable attributes (e.g., strategic vision, comprehensive understanding of the company, collaborative skills, strong leadership skills, professional credibility, etc.) and authority required to help the organization be successful.

Identification of revene organization members:

Closely following the assignment of a CRO is the identification of all the members, both departments and individuals, that comprise the revenue organization. Once identified, their roles in the revenue process should be specifically defined. Our buying cycle can be a useful in that identification and definition.

Development of common strategy and language:

Once the revenue organization has been clearly defined, it is important for everyone to agree to a unified strategy for how the organization will generate revenue. Toward that end, a comon set of concepts and terminology is needed. That step is critical to the success of the strategy, and it should not be ignored or downplayed. The common concepts and language are typically codified in the CRM system, and should be used universally throughout the organization in communications and collateral.

Definition of revenue process and milestones:

With a common language and strategy, the overall revenue process and all the sub-processes can be mapped and any gaps identified. Our universal process model can assist with that mapping. Processes can then be refined and key milestones operationalized in such a way that they can be measured. Finally, systems are established to track and report on those process milestones.

Customer profiling and defining target markets:

Critical to the success of any business is clearly defining your target market(s) and the most market definition being data-driven. Since markets are made up of customers, defining markets starts with profiling the customers that make it up. All the key players with the customer-base should be identified, the characteristics that define and differentiate them analyzed, their role in the decision-making process defined, and their reasons for buying articulated.

With today's vast amount of available data, there is a delicate balance between having enough to be effective and having so much that you are drowning in it. There is no single answer to what that balance should be. A good place to start is by using desriptive statistics to understand your current customers. What are the characteristics of your current customers - best,worst, and ideal? It is also important to understand who your target market is not. What are the characteristics of those who never will or never should buy from you? Lastly, analyze who matches your customer profile but does not buy from you. Why not? We are amazed at how many companies can not answer those questions.

Once you have anlyzed your data to understand your current customers, you can also begin to incorporate additional data and use predictive statisitcs to attract new customers and move into new markets. To get new data, companies can conduct their own research or acquire it from secondary resources. Because of the vast mounts of data available, many companies become overwhelmed. It's important to keep your focus on what information will really be useful in providing more insight your current customers so that they can be better targeted and your messaging can be refined to be more effective. In reference to new markets, the focus should be on why new markets would want your offerings, and the profile charateristics that will help you understand them and reach them with the available marketing resources.

Implementation of organizational Client Resource Management system:

The revenue organization must have a means of record keeping, data tracking, document mnagement, reporting, and a host of other functions. This is commonly termed a Client Resource Management (CRM) system and there are numerous technologies designed to meet this need. Many are good and we often recommend them. But, it is important to note that a CRM system is a process. Technology is an enabler of the process. The process should not be equated with the technology. It is easy to get enamored with advanced technologies and let it drive your process. Keep focused on your organization's needs and requirements, and what will best serve them. For a CRM system to be successful, a critical first step is an extensive organizational needs assessment.

With a CRM, we are strong adherents to the principle that only quality data going in will produce quality results - otherwise, garbage in, garbage out. Technology, no matter how advanced, can not turn bad data into good information. Quality data going into the system comes from two things:

  1. Compliance, meaning people actually using the system

  2. Data everyone understands - the common langauge and strategy, and defined revenue process and milestones developed earlier will make the data comprehensible to everyone

As noted, making the data understandable and usable by everyone in the revenue organization will be accomplished by adequatel addressing the tasks related to language, process, and milestones. Compliance is another matter and one that is often under-appreciated. Achieving compliance will take a multi-pronged approach. First is to make certain the system is convenient and easy to use. Both should be key criteria in selecting and designing the system. Second is to implement an effective change management program that includes:

  • Explaining to all the relevent parties the rationale for the system

  • Providing comprehensive education, training, job aids, and other support materials to the users

  • Rewarding desired behavior (i.e., compliance) by building in both short and long-term incentives

  • Celebrating success both within functional, across the revenue organization, and throughout the entire company

  • Ongoing 360 degree feedback systems

  • Periodic reviews and updates

  • Making revisions and adjustments, as necessary

Often, the CRM change management program will likely be most effective if it is done incrementally. In turn, the CRM will evolve in both complexity and quality as its use grows. And, as that evolution progresses the benefits gained from it will grow accordingly.

The emphasis in the alignment phase is on integration and coordination across the entire revenue organization. Key components include:

Unified metrics across departments:

Building on the common language, strategy, and milestones that were developed in the establishment phase, the organization can now create a unified set of metrics that will be used across all departments. This will enable the organization to better track opportunities as they move from leads to prospects to customers, and assess the effectiveness of all the organization's efforts.

Comprehensive competitive analysis:

The revenue organization should create and maintain a comprehensive analysis of competitors that can then be available to use in sales and marketing. Although input will certainnly be gathered from multiple sources and the how the information is used will be the responsibility of individual departments, there are many reasons for the overall responsibility for the analysis data to lie with the revenue organization. The organization's broader perspective, and greater can access to information and resources will help create more comprehensive and detailed analyses. A centralized system will help promote a more unified competitive strategy and consistent tactical execution. Lastly, the organization can provide greater continuity, ensuring that information is kept current and knowledge is not lost. The keys to an effective competitive analysis is that it be:

  • Structured: There are many good systems for analyzing the competition that can provide structure. We utilize SWOT (i.e., Strengths, Weaknesses, Opportunities, and Threats).

  • Comprehensive: Certainly a competitive analysis must include all the options available to satisfy the same market need as your offering. To be truly comprhensive, that analysis should consider all five areas in which you competet (i.e., Capabilities of your offering, Change management, Value, Your company, How you sell) - and include both an analysis of your own organization and of the prospect taking no action as one of your competitors.

  • Honest: A competitive analysis is not the place to overlook areas because they are uncomfortable or unpleasant. Nor is it the place to enagae in sugar coating or spin. If you are not honest, you will be at risk. An outside resource can be very valuable in providing a more objective perspetive and facilitating critical self-reflection.

  • Useful: The purpose of a competitive analysis is to drive decisions and actions throughout the revenue organization. The analysis has many potential applications, including: guiding reps in how to win more opportunities, informing development on enhancements and new products, and marketing on messaging and targets.

Customer Success Factors identified and agreed to:

Customer Success Factors (CSFs) are specifc items that prospects agree will be tracked to monitor the outcome of their purchase. You want CSFs to be a direct measure of the impact from using your product or service. CSFs are tied to the business objectives of the prospect, but they are not the same as the ROI - and typically should not be monetary in nature because too many other factors can complicate such measures. Some examples of CSFs are: time, volume, error rate, productivity, etc. In addition to the CSFs themselves, tracking and reporting methods also need to be established. Because CSFs can serve a variety of purposes, they should be strategically selected and prioritized with input from the entire revenue organization and those determinations conveyed to sales.

The primary purpose of CSFs is to demonstrate to both the customer and vendor the positive outcomes from the purchase; but they also serve many other purposes. CSFs can identify opportunities for up-selling and cross-seeling additional products and services. They can be used to create powerful case studies and whitepapers, which can be used in marketing campaigns and as proof to other prospects. Many customers are proud of what the outcomes they have achieved and are willing to share that with their peers. If so, they can be enlisted to participate in educatonal seminars, webinars, etc. And they will often have much greater credibility with their peers than the vendor ever will.

Internally, CSFs can also be a source of celebration. Any organization needs sources of motivation and reward. Too often the sole focus is on making revenue targets. But relying exclusivly on revenue is risky for a variety of reasons. A short and incomplete list includes:

  • Too many factors can affect whether revenue targets are achieved, and missed targets may mask the outstanding work of specific indivduals and departments

  • Solely emphasizing revenue tends to over-inflate a limited number of department, such as sales, which can erode overll organizational unity and motivation

  • When revenue targets are not met, little or nothing is celebrated, de-motivating the organization and frequently causing anxiety

Integrated campaigns and collateral:

With a comon language and strategy, all campaigns can now be coordinated across the revenue organization. That coordination starts with the planning stage and would include:

  • Agreeing on which market(s) and key players within them will be targeted

  • Establishing how contact with key players will be initiated

  • Developing collateral customized to the concerns and interests of each key player

The previously established milestones and unified metrics will allow leads to be tracked throughout the buying cycle and the effectiveness of specific capaign components evaluated.

Defined product proof materials and processes:

Proof comes in many forms and each addresses different prospect concerns. A quick, and incomplete, list of the kinds of proof include:

  • Product demos (live, or recorded)

  • References (onsite, phone, etc.) and testimonials

  • Client list

  • Case studies

  • White papers

  • Staff biographies and certifications

  • Corprorate financials and other demographics

No matter the type, all proof shares two things: their purpose is to move the buying process forward and they take up corporate resources. With respect to resources, it must be noted that different types of proof utilize dramatically different amounts; and some of those resources, such as reference sites or technical experts, can be very precious or expensive. In the zeal to close the sale, a strategic analysis of which proof to use in a given opportunity is often neglected. Too often, the approach is to keep throwing resources at an opportunity with little consideration of what concerns actually need to be addressed and how that can be accomplished in the most cost effective manner.

The revenue organization, by definition, is responsible for the development and deployment of the proof resources - to make certain that comprehensive resources are available and that they are used effectively, both in terms of moving sales forward and containing costs. A smart organization will:

  • Conduct market research to identify an exhaustive list of relevant concerns 

  • In that research, also determine the various means by which the concerns can be addressed

  • Conduct a cost analysis for developing and deploying each potential proof

  • Prioritize what resources will be developed and create a plan for doing so

  • Identify when in the buying cycle each concern is most likely to arise

  • Identify the indicators of specific concerns

  • Strategize how those indicators will be elicited and confirmed, and who will be responsible for that

  • Define the criteria and process for determining when a proof resource will be deployed

  • Establish a means of determining whether the concern was effectively addressed

Organization-wide sales enablement:

Sales enablemt might be seen to only apply to the sales department or those directly selling. Our perspective is that everyone in the revenue organization is involved in sales. Adopting that view, sales neablement includes all the activities and resources directed toward improving the performance of any imdividual or funcition within the revenue organization, or the organization as a whole. In that context, the revenue organization should take a cmprehensive perspective on enablement. Coordinating enablement efforts will support some of the previous goals, such as adopting a common language and unified metrics,and make more additional more effective. Coordination will also allow for greater sharing of resources and promote a variety of collaborative effors.


With revenue organization activities aligned, the emphasis shifts to optimizing production and effectiveness. This is achieved through enhanced use of data to further support the strategy and tactics, and implementing means to maintain long-term performance continuity throughout the entire organization. Key optimization tasks include:

Full cycle lead-to-customer tracking:

With everything that has been previously implemented (e.g., common language, identified milestones, unified metrics, etc.) the revenue organization can now track movement through the entire buying cycle - from lead to prospect to customer and back to new opportunity. This tracking will provide insight into the effectiveness of all the organization's activities, and data for further improvements.

Comprehensive cost-of-sale calculation:

It is important to understand the full cost-of-sales (COS). Too often, COS calculations focus only on the direct costs (e.g., expenses of sales and field personnel, some lead generation and marketing costs, etc.) but omit other key cost factors. Common omissions include: cost of order processing or other sales operations, unquoted services or support, and the cost of proof materials. With a revenue organization that is fully integrated, all of the true costs that go into a sale can be identified and calculated. This can help contain overall costs and provide insight into areas in need of improvement.

Organizational knowledge management:

Organizational knowledge is a strategic assest. As such, effectively managing it can improve performance and be a competitive advantage. The purpose of many of the development activities up to this point has been to create information with a unified structure and language. Now that it has been generated, that information has to be analyzed and disseminated so that it can be utilized in a myriad of ways throughout the organization. The information also needs to be maintained so that it stays accurate and current, and so that information is not lost and continuity retained when disruptions occur. All of that speaks to implementing formalized knowledge management processes.

The extent and details of those processes will reflect the complexity of your organization and data. But, it is important to recognize that knowledge management is a critically important process. It is a lot more than just gathering and saving files in a central location. The process will include people, procedures, policies, and technology. From our experience, we strongly recommend that someone with expertise in this area lead the design and implentation of knowledge management processes. Going forward, an expert can be brought onboard or it is ften effective to make it a primary responsibility of a senior member of the revenue organization, if that person is adequately trained in knowledge management and this responsibility is fromally recognized as a significant part of their duties - not just dismissively added to the responsibilities of someone who is already stretched thin.

Strategically defined negotiation trade-offs

This will not be a review of negotiaitng tactics, Instead, the emphasis is on the strategic component of determing trade-offs - what you will give up and what you will ask for - based on the larger goals of the organization. As discussed in the section on Sales Rep Development, reps are typically concerned with one thing during a final negotiation with a prospect - doing whatever it takes to make the sale then and there. And usually that means making whatever monetary concessions they can. But, what the rep is willing to do may not be in the best interest of the larger organization.

Strategically, the organization should prioritze what they are willing to give up and convey that to reps. Some monetary concessions have a greater true cost to the vendor than others. And with every concession made, the vendor should get something in return. The revenue organization should be directly involved in the identification and prioritization of what to get from the propsect for any concessions given up.

Often, it is easier for the vendor to ask for concessions that have no direct cost to the prospect - but help the vendor generate future business. Research consistently shows that satisfied customers are one of the most powerful marketing tools. Customers help you generate more revenue in a number of ways: introducing you to colleagues; through public endorsements; by leading educational seminars; collaborating on whitepapers, etc. They can also help close opportunties by serving as proof of capabilities by: serving as a refernce; writing case studies, etc. The ways you can use a customer is limited only by how you market your offerings.

The revenue organization also needs to support reps in negotiations. The first means of support is to provide incentives in the compensation plan for desired behavior, such as for the trade-offs made or the profit margins of sales. It is also important that revenue organization members do not undermine the rep's authority. The most common way that occurs is for a senor manager to get involved directly in the negotiaion and then to offer additional concessions. When that happens, any future negotiations - and even general account maangement - will be difficult for the rep. Lastly, the revenue organization has to support a rep's willingness to walk when appropraite. 

Organizational cross-training and cross-staffing:

Cross-training and cross-staffing throughout the revenue orgnization can provide many benefits. Having each function in the revenue organization understand and appreciate the role of the others helps build organization unity and increase effectiveness. Getting more insight into other functions can help staff make career shifts, finding positions they are better suited for and reducing staffing costs for the organization. The increased knowledge of what other do and greater flexibility in staffing can also improve organizational continuity when there is departmental turnover or restructuring.

To mature your organizational processes and increase profitability, we can help you:

  • Increase visibility into your entire pipeline, from lead generation to implementation, by establishing an auditable sales process

  • Define and execute your go-to-market strategy

  • Align your sales, marketing, and services organizations with a common language, strategy, and communication systems

  • Develop buyer-focused practices and materials throughout the revenue organization

  • Establsih criteria and processes to identify when and how executive management can play a direct role in the revenue generating process

  • Strategically establish negotiation "give-and gets" that benefit the entire organization

  • Strengthen all five areas in which you compete

  • Automate revenue generating processes, including CRM, in the most cost-effective manner

  • Analyze your current processes and provide recommendations for process improvements

  • Effectively manage change and development efforts

  • Motivate and lead the organization

By identifying gaps and understanding the interplay of processes and skills, we can help you create a comprehensive organizational development plan that maximizes effectiveness and efficiency. You can read more about our developmental model and its the benefits.



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