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Is it just me, or do most business leaders reading the morning news feel a bit like Bill Murray in ‘Groundhog Day’?
Are we in a recession? Are we about to be? What’s with inflation? Is the Fed raising interest rates? Day-in, day-out, it’s the same old song. Cue an exasperated Murray waking up to I Got You Babe time and again.
It’s an apt metaphor, and not just for the relentless redundancy in our daily headlines. Many of the world’s savviest companies are taking a cue from the time loop that captures Murray’s cynical weatherman character, taking advantage of “downturn downtime” to reinvent themselves so when the skies clear, they’re in a great position to win.
In Groundhog Day, Murray — after some amusing (and at times dark) detours — finally comes to realize that time is on his side and so he may as well make the most of it. He eventually ditches his ingrained bad habits and learns to play piano, chisel elaborate ice sculptures, and treat his fellow humans with kindnesses large and small.
Forward-thinking companies are doing something similar, starting with a reinvention of the most fundamental process in business — running revenue. They are jettisoning old ways of working and implementing changes across strategy, operations and technology to create a predictive and precise system to truly run revenue like a modern, well-oiled machine.
Here are some of the biggest developments underway that every CEO should be tracking and emulating.
• Introducing the Chief Revenue Officer. How do you know when a company is serious about change? When it creates a new C-suite position. Earlier this year, #1 on LinkedIn’s 2023 Jobs on the Rise list was the Chief Revenue Officer (or Head of Revenue Management). Fast Company nailed the job description: “A CRO’s job is to be disruptive, to assess how a business brings in money, and to figure out how to do it all better—traditional processes be damned.”
• Expanding corporate governance to include revenue. Public companies long ago “got religion” about corporate governance, which Gartner defines as “the set of standards and processes that describe how an organization will be managed,” with an aim of balancing “the interests of … shareholders, board of directors, executives, and customers.” Now public and private companies alike are treating revenue governance with similar rigor, implementing comprehensive frameworks and week-by-week breakdowns of every single event and moment that contributes to revenue capture.
The ultimate goal? To deliver complete transparency, precision and control over the company’s end-to-end revenue process. And to shrink time to revenue — the amount of time your company spends collecting revenue-critical signals, analyzing them, and acting on them to see a lift in revenue.
• Out with the old. Companies are waking up to the fact that the systems they’ve been relying on for decades aren’t up to the modern task of running revenue. Take CRM. Customer Relationship Management is decades-old tech. It’s a challenging user experience, constantly demands manual data entry, and offers precious little back. Importantly — Sales teams really struggle with it. They lose precious selling time and productivity inputting data (often inaccurate and incomplete data, by the way). Companies collectively miss out on trillions of dollars in potential revenue via revenue leak, which is revenue that an organization has earned but hasn’t captured due to deal slippage, inaccurate billing, bad data, human error or unbilled services or products.
Spreadsheets and BI tools are similarly lacking. Spreadsheets are a snapshot in time, take hours to roll up, and the average viewer gets lost in the maze of columns, rows and cells. BI tools are useful for what’s already happened, not so much for forward-looking insights and predictive scenarios.
• In with the new. Companies are coalescing around a new technology stack that’s purpose-built for running revenue with precision. With open APIs, and bi-directional syncing, they are building comprehensive databases of every critical revenue signal and human conversation. They are automating data entry for relevant systems (including those archaic CRMs) in order to increase data quality and give time back to reps and other revenue-critical employees to do more selling.
And they are using predictive, NLP and generative AI in myriad ways to tackle problems that companies previously wrote off as simply unsolvable. AI is making that automated data entry fast, efficient and highly accurate. AI is helping companies more precisely assess revenue risk and predict revenue outcomes. AI is being used to analyze — at lightning speed — thousands of conversations between sales reps and prospects, and then come back with automated summaries and suggested next actions. It is even taking the next steps itself, drafting emails for reps and scheduling follow up meetings.
The bigger picture concerns about AI are unquestionably legitimate and require concerted attention and regulation. But in the context of business-specific datasets and workflows, AI is being implemented with safety, security and guardrails. And rather than displacing revenue jobs, AI is helping revenue employees become more productive and do more meaningful work.
All of these changes in corporate practices, processes and technologies make it possible for companies to drive newfound, tangible value. Instead of running elaborate hedges and crossing their fingers to hit a forecast, companies are able to proactively peer deep into product mix predictions to manage profitability and EPS. CROs have historical, real-time and predictive revenue figures at their fingertips. Teams can now spend their time together strategizing and problem-solving instead of chasing down or arguing about questionable data. I’ve seen this unfold all the way up to the boardroom level, where real-time data is clarifying at-risk deals, spotlighting net-new and customer expansion opportunities, and spurring actions that bring them home.
Running revenue as a rigorous enterprise process is helping more and more companies find new levers for growth and measurably improving forecast accuracy, win rates, revenue growth, net dollar retention and more. It’s shrinking time to revenue and, importantly, helping revenue employees be more effective operators, better fiduciaries and happier, more productive people.
Every company should be reinventing itself — because Groundhog Day won’t last forever, and the most durable companies over the long haul will be those that intelligently leverage advanced technology and processes to achieve repeatable and predictable revenue generation.
The post For CEOs Experiencing ‘Groundhog Day,’ New Ways To Run Revenue appeared first on ChiefExecutive.net.
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