Navigate these five powerful revenue trends
Key takeaways for revenue leaders from Anaplan Live!
Anaplan Live! 2022 is a wrap. Our largest live-and-in-person event since 2019 certainly did not disappoint. Over the course of three days in downtown San Jose, we hosted over 1,100 customers, over 200 members of partner organizations, dozens of Master Anaplanners, and much more.
Although attendees brought a wide variety of backgrounds and areas of expertise, many of them shared certain things in common: a need to move more quickly and act with greater agility; a desire to make their organizations more resilient in the face of sweeping changes; and a continued focus on transformation to help achieve major business outcomes. For the sales operations or revenue operations leaders in attendance, many of these challenges were existential.
So, what were some of our key takeaways and observations? A few central trends emerged.
1. Sales organizations must get better at grappling with uncertainty
The macroeconomic trends are all over the news – the highest inflation rates in a generation, slowing growth exacerbated by supply chain woes, high energy prices driven by the war in Ukraine, and more.
For a revenue leader, these economic forces raise a lot of questions. How and where should I consider changes to my territory structures or provide quota relief to sellers? For companies selling goods, what changes should I make to my pricing or promotions strategy? These are complex questions to answer, and they often require modeling and evaluating difficult tradeoffs.
The uncertainty behind these questions makes analysis more difficult – but also more necessary for leadership to engage with and understand. As Finance Manager at Cisco Systems Matt Kasold notes, “We’ve had to change the frequency with which we do our target and goal cascade, and our territory planning. Because of some of the changes over the last three or four years… we’ve had to increase the number of iterations [in our planning cycle] to adjust.”
Ignoring uncertainty does not make the problem disappear. Sales and revenue leaders must find ways to grapple with uncertainty, and derive insights in spite of incomplete information.
2. Poor planning puts revenue at risk
In organizations large and small, planning is still often a slow, labor-intensive process. There are homegrown systems in even the most sophisticated sales and finance organizations shoring up critical planning tasks such as sales capacity planning or territory planning, and these systems introduce more and more risk as organizations change and market conditions evolve.
Brent Corbett, Senior Director of Sales Planning at VMware, discussed this in terms of gap analysis:
“We’ve looked at our coverage models and that has created some sense of urgency… When it comes to quotas, 9,000 salespeople have to carry a $13 billion number. How much of that is actually being carried by people? How many open positions do I have? If [a sales leader] is trying to achieve a $13 billion number, especially in a tight labor market, and [they] have 10, 20, 30% turnover, how are they going to make that number?”
These questions become more difficult to answer as organizations add new products or services, divisions, or revenue models.
For many organizations, things get ugly around the start of a new fiscal year. If sales territories, quotas, and compensation plans are not assigned at the beginning of the year, sellers lack focus and valuable time is often wasted. Yet the source of these costly delays starts several months earlier, during the planning cycle.
3. Sales and other functions are becoming increasingly intertwined
For years, sales leaders have been working on the often messy handoff between sales and marketing. Issues of unclear market segmentation, low lead quantity and quality, and misaligned strategies are stubborn problems for revenue leaders in all types of industries and markets. A foundational part of this problem lies in the types of data that are collected and how they are used to derive insights.
As Director of Sales Operations at Lumen Technologies Melanie Webb puts it, “I like to call it ‘random acts of data.’ If you give the same data set to 10 different people, you are going to get 10 different interpretations.” This prevents sales and marketing from aligning on the best deals, and putting resources behind the most promising areas of growth. To that end, says Webb, “We have really focused on building our sales territory and module planner, and quota planning model, so that we can get the right level of resources on the right opportunities.”
Less discussed is the relationship between sales and finance. This relationship often only comes up in the context of misalignment on goals or objectives; for example, disagreement on the level of acceptable discounting. But these two groups have more in common than meets the eye, and they particularly need to align on planning.
Matt Kasold from Cisco Systems brings this to life: “You definitely want alignment between your sales plan and your financial plan. You need to interlock the two. A more aggressive sales plan means more revenue on the financial plan, so you would have to model that. But then you would also need to talk to supply chain; you would need to build more products and account for more cost of goods sold. You might even need to hire more people.”
Strengthening the critical alignment between finance and sales requires collaboration and trust. It also takes a fundamental agreement on the numbers – at least as a starting point for negotiation.
4. Transformation means different things to different people
The word “transformation” gets thrown around a lot these days. In today’s sales organizations, the scope of transformation can be expansive, and it varies widely by industry. It often includes improving the experience for sellers and other customer-facing functions.
For Philips Healthcare, making commissions-related questions quick and easy for a compensation administrator to answer was part of the solution. “Make it easy for the support activity to happen,” advised Prasad Varahabhatla, Senior Director, Sales Incentive & Data Operations at Philips. “The way a utopian world looks to a commission analyst and support analyst is [not needing to run a report] to support a salesperson.”
Increasingly, transformation efforts are also about innovating an organization’s go-to-market approach and unlocking value through better processes and more coordinated planning. Consider the massive growth in the popularity of revenue operations functions within organizations.
“The term ‘revenue operations’ is an allegory for alignment across the go-to-customer functions,” says Dana Therrien, VP of CRO Practice at Anaplan. “If you’re in sales operations, you’re looking to better alignment between the headquarters sales operations, the field sales operations, the compensation team, and the renewals team. You just need better insights because the market is demanding it.”
5. It’s (still) all about people
Perhaps just as important as aligning on data and process is having a method for finding and organizing talent. Many Anaplan customers have created model-building Centers of Excellence (CoEs) for their organizations. They have identified several ways to do this – some centralized and others distributed across divisions, geographic boundaries, or partner organizations.
Often, the CoEs help with finding and developing Anaplan experts to help model critical business processes, and provide guidelines and standards as other processes are identified. For sales specifically, some of the key stakeholders might include the business process owners themselves – e.g., heads of sales or revenue operations, or sales leadership – as well as model builders, solution architects, and project managers. Ultimately, these teams are designed to help corporate leadership answer difficult and complex questions and rapidly respond to change.
Making rapid decisions is at the heart of the partner-based CoE model used by Meta. “The partner-based model… allows us to spin models up faster and work on enhancements faster,” says Matthew Shields, Program Manager at Meta. “Every quarter, and for all three months of the quarter, we have a deadline. Leveraging this team to work across use cases has been invaluable for us.”
Didn’t have a chance to attend Anaplan Live! this year or simply want to learn more? Hear directly from Anaplan partners, customers, and subject matter experts on our session replays page.