 Audio Series: Interviews from Set Up To Win Topics Covered In This Interview (7:27 Minutes)
 Are you using the Revenue Equation? First, let's cover why it's important. In order for any sales and marketing tactic to work at maximum effectiveness, it must be implemented within the context of an overarching strategy. Simply put, you need to determine where your business is right now and where you want it to go. Then, develop a plan to get from point A to point B. That's your strategy. Many sales and marketing teams pull the trigger on key decisions without having a clearly defined strategy in place. On the other hand, the most successful companies out there adhere to their core strategy in all major sales and marketing decisions. They have a firm grasp of what their sales strengths and weaknesses are and deploy their tactics accordingly. At the end of the day, your company's strategy will determine the ultimate success of your sales and marketing efforts... which in turn will determine whether you hit your revenue and profitability goals. Thus, the ability to identify strengths, weaknesses, areas of misalignment, and adjustments that are "low-hanging fruit" is vital to sustainable success in your sales and marketing integration journey. You may wonder: Okay, I understand all that, but how can I effectively identify those things and then make the needed changes? This is where an exceptional tool comes into the picture: namely, the Revenue Equation. Why the Revenue Equation Is So Powerful The Revenue Equation is a framework for sales and marketing organizations. It's an assessment designed to help understand the root causes of sales and marketing problems. Ultimately, the goal is to create systems that will solve those problems. The true power of the Revenue Equation kicks in when all the stakeholders in an organization (specifically, leadership, management, and sales/marketing team members) get on the same page. When everyone in a company has a clear, shared understanding of what needs to happen moving forward, then everyone can work as a team to turn that vision into a reality. I talk more about the Revenue Equation in this recent audio interview. How the Revenue Equation Works The Revenue Equation consists of three core factors that paint a comprehensive picture of what's needed for revenue stabilization and growth. These three factors are:
For each factor, you'll need to assess where your company stands at the moment, especially in comparison to where you want it to stand. Everyone in your company should take part in this assessment. Remember: you want all stakeholders to be on the same page. With that in mind, let's briefly list some questions that your assessment should include, taking it one factor at a time: 1. Foundations How well defined and understood within your organization are:
2. Design How well defined and used within your organization are:
3. Infrastructure How well defined and used within your organization are:
As you implement the above assessment throughout your company, you may indeed find several areas of opportunity that need to be addressed. However, don't forget about the flip side of the coin: you'll no doubt also identify several sales strengths that your organization possesses — advantages that your competitors may not have. So the Revenue Equation is not only a great way to identify bottlenecks in your sales and marketing process that is hindering progress; it's also a wonderful way to remind yourself of and solidify those aspects of sales and marketing that your team already does really well! How the Revenue Equation Can Lead to Strategic Success It should be noted that the Revenue Equation is not a "one and done" type deal. It can (and should) be refined and redeployed over the course of time, as your company grows and adapts to new opportunities in the market. Leveraging the Revenue Equation in such an intentional way can create accountability, increase efficiency, and optimize performance throughout your organization. It will help your sales and marketing teams become (or stay) aligned, and develop greater clarity around their role in propelling your business forward. Let's briefly review what you can do to leverage the Revenue Equation into a sustainable growth driver:
It's true that investing in strategic development can be time-consuming at first, and it may be tempting to "skip ahead" to sales and marketing tactics. However, using the Revenue Equation discussed above can lay a solid foundation for all of your future sales and marketing efforts. It can help align all departments within your organization and ultimately improve your sales performance. Ultimately, it will increase sales! Learn More A healthy relationship between sales and marketing is vital to an organization’s success. Dive deep into this effective strategy in a new book called Sales & Marketing Alignment. If you'd like more insights on how you can improve your sales leadership, contact us. Or sign up for our newsletter for more valuable resources. |
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