What is the Best Sales Operations Team Structure for a Large Business?
Businesses of all sizes employ a sales operations teams. Yet, enterprise businesses must deal with managing a large number of sales processes and team members. For instance, companies such as Novartis and the EMC Corporation hire and retain thousands of sales professionals from outside sales reps to inside sales reps, sales managers and more.
Success for these organizations becomes dependent on sales team structure.
So, the sales operations team needs to be structured in a way that fosters full support for a successful sales team. How big should your sales operations team be? It really boils down to balance. Since sales is the main revenue driver for many companies, it takes the right-sized operations team to ensure the sales team hits their numbers. And, the size of sales operations should align with a company’s business objectives, budget, and sales goals.
It’s also important not to have more team members than is necessary as that could be a drain on costs. Start by working backward from your organization’s growth objectives and consider time for onboarding, employee attrition, and quotas. Next, it is critical to look at context. Consider industry benchmarks when it is time to set up your sales operations team structure.
In addition, your company probably already has a significant stream of recurring revenue. So, you want to focus on new business, new lines of business and former clients. This requires a more strategic focus for structuring your sales operations team.
You might also have a number of non-closing sales team roles to support such as business development reps. As you can see, there are many factors to consider before deciding on the final model for your sales operations team structure.
Sales Operations and Your Business
The sales operations role first came into play at Xerox in the 1970s. According to Neil Rackham, author of Spin Selling, he saw that Xerox created a group to manage territory design, compensation, forecasting, and sales planning. Rackham noted group leader J. Patrick Kelly depicting their job description as, “all the nasty number things that you don’t want to do but need to do to make a great sales force.”
In essence, the functions of sales operations include supporting the sales team in a way that is aligned with the company’s strategic objectives. The sales operations team is also often tasked with analytics tools to help find and create new channels for growth.
Some of their day-to-day responsibilities include:
- Setting up sales territories
- Monitoring sales data
- Reporting campaign results
- Sharing wins
- Managing compensation plans
- Oversight of lead generation
- Training the sales team in products and services
- Generating go-to-market strategies for campaigns and products
- Managing contracts and proposals
Having a sales operations team is essential for supporting the sales team’s success.
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Sales Operations Will Grow Your Business
The types of individuals who work best in the sales operations role are people who can envision a company’s future by integrating analysis, design and a detailed working structure. There are the aspects of report building, along with anticipating the needs of the sales director.
Pivotal to success is the ability to generate a structured sales process and review sales performance within that process. The next step is to employ solutions based on their strategic findings. In the end, all of these processes are designed to help sales reps to make their quotas. So, how does sales operations grow your business?
1. Enhance Conversion Rates
One of the most comprehensive measures of a sale team’s success is conversion rates. This is where a prospect turns into a buyer. Sales operations can look at where the most conversions take place. Perhaps there are sale reps who have no issues converting leads into opportunities, but then struggle to win those opportunities.
On the other hand, there might be reps who can convert opportunities to wins but have a difficult time finding and qualifying leads. As a result, the sales operations team can identify the appropriate solutions to ensure success in both scenarios.
2. Ensure Sales Reps Focus on their Key Strengths
Even with standardized procedures in place, there will be subtle nuances between the approaches of each sales rep. As your sales team scales, it can become more time-consuming to learn of each reps strengths and weaknesses. This is where the sales operations team can help by analyzing historical performance, segmented by opportunity type.
The sales operations team can also look at which campaigns produced the biggest impact to quota achievement. So, they can offer a guide to maximize the strengths of each sales rep to maximize every win.
3. Shorten the Sales Cycle
Ultimately, sales success must be measured and managed. The same is true of the sales cycle. In this regard, the sales operations team can identify weaknesses throughout the sales cycle. They can then work with sales directors to configure solutions that facilitate a faster-moving sales funnel.
So, that would enable a win-win scenario for all involved–the sales reps meet or exceed their quotas and can make better commissions, and the sales operations team contributed to that success.
Sales Operations Team Models
According to Harvard Business Review research, 50% of top-performing sales organizations have highly-structured and documented sales processes. And, these sales processes are designed by sales operations teams. So, let’s take a look at a few organizational models to help determine which one works best for your enterprise business.
1. Assembly Line
Think back to the days of the Model T Ford, and the assembly line it took to produce that historic piece of automotive engineering. Now, transfer some of those organizational characteristics to your sales operations team where raw materials are customers and the assembly line consists of different areas of focus such as:
- Lead generation
- Business development
- Territory planning
- Account management
Like an assembly line, each team member specializes in a different role. Furthermore, each step of the sales cycle has a dedicated team member. As a whole, each section of the assembly is specialized so you can increase transparency and accountability. There are a few pros and cons as noted below.
- Provides predictability
- Can pinpoint issues in the assembly line
- Improves efficiency
- Hard to construct with fewer than four or five team members.
- Might become too segmented and disparate
- Difficult to connect all of the team members
Large businesses may appreciate the repeatable and verifiable processes employed with an assembly line model.
2. The Island
This model offers a more traditional structure where you have one manager for a set of team members. Each team member can take on multiple roles for sales operations from territory planning to quota and systems’ management. Each team member may also be directly aligned with several sales reps, and each is responsible for helping those reps meet their numbers.
- Works well with simple sales processes
- Requires minimal management
- Can create an aggressive and highly competitive environment
- Each individual may develop their own style
This is a simple model that can work well in environments where competition is encouraged.
3. The Pod
This is similar to the assembly line model, except a pod will dedicate two or three team members to specialized roles that match each point in a customer’s journey. Instead of competing within the team, pods compete against other pods.
As a result, this is a highly customer-focused model. And, since each team member contributes to the pod–it offers a more holistic approach for the sales department. Moreover, it encourages collaboration.
- The focus is on the customer journey as a whole
- Communication is improved
- Flexibility is encouraged
- Fewer opportunities to highlight individual successes
- Each member must master many functions
The pod works well for larger organizations since it is a more structured version of the assembly line. It provides a competitive atmosphere without feeling overtly aggressive. Plus, it offers the agility large companies need to continually evolve with changing customer demands.
As you can see, there are various models for a sales operations team structure that can work depending on your business needs and company objectives. Nonetheless, sales operations teams are a necessary addition to sales team success.
Shifting the Performance Curve: Identify Trends in Low Performers Before You Miss Your Numbers
In our upcoming webinar, Shifting the Performance Curve: Identify Trends in Low Performers Before You Miss Your Numbers, we’ll highlight some key metrics that are often overlooked when evaluating the health of your sales org and show you how Xactly Insights for Sales builds high-performing teams.