Outsource to Outperform: Unlocking Growth by Embracing External Expertise

Intro VO  00:05

Welcome to revenue rehab, your one stop destination for collective solutions to the biggest challenges faced by marketing leaders today. Now head on over to the couch, make yourself comfortable and get ready to change the way you approach revenue. Leading your recovery is modern marketer, author, speaker and Chief Operating Officer at Tegrita Brandi Starr

Brandi Starr  00:34

Hello everyone and welcome to another episode of revenue rehab. I am your host Brandi Starr and we have another amazing episode for you today. I am joined by Taft love. Taft is the founder of iceberg Reb ops. He is also the head of sales for doc send a Dropbox company and when he's not focused on sales or revenue operations, Taft is usually spending time with his wife and son or volunteering as a medical transport pilot. Welcome to revenue rehab TAF to your session begins now.

Taft Love  01:12

Hi, thanks so much. I appreciate you having me.

Brandi Starr  01:15

Awesome. I'm glad to have you I can say I also spent a lot of time volunteering. But as a medical transport pilots, that is probably way more exciting than some of the efforts that I've been a part of. So that's that's a very cool thing to be doing on the side.

Taft Love  01:32

Thank you. It's a lot of fun. I love doing it. Oh, well.

Brandi Starr  01:36

Awesome. Um, so before we dive into our topic, I like to break the ice with a little Whoo, sigh moments that I call buzzword. banishment. So tell me what overuse word would you like to get rid of forever?

Taft Love  01:55

I think scale I hate does it scale? How do we scale it? What's the what's the path to scale? Everything doesn't need to scale?

Brandi Starr  02:07

It? I think I would agree in general. Um, you know, I think people became obsessed with scale. Because there were so many things that were done in business that did not scale. And, you know, I can just think about early in my career times where we did something, and then it was like, you hit a wall. And then it was like you had to start over. And then you did the next thing, and then you hit a wall. So I do think that people have gotten overzealous about scaling everything.

Taft Love  02:42

It's like anything in business, you have to find balance, you can prematurely optimize and spend a lot of time scaling something that didn't work anyway. Or you can fail to set yourself up for scale and hit a wall because you can't do something that works well, quickly enough.

Brandi Starr  02:57

Yeah. And I do think that scale is something we should think about. But that we don't always have to plan for scale. It's like you do you have to at least think about like, do we need it to scale? Or do we just need to move quickly and get something done? So I'm gonna try because for this topic today, not saying scale, maybe a little bit tough, but we're gonna try, we're gonna put it in the box, we're gonna you know, tie it up, put it on the shelf, and try to not talk about scale today. So now that we've gotten that off our chest, tell me what brings you to revenue rehab today.

Taft Love  03:38

Yeah, thanks for thanks for asking. I'm here today to talk about revenue operations. And specifically, when and where it makes sense to outsource it versus have it in house.

Brandi Starr  03:49

Awesome. As I say, you have hit on two topics that I feel so passionately about, I mean, as a consultant, obviously, you know, I have a slant on, you know, that certain things should be outsourced. But then revenue operations is such the backbone of, you know, really all of revenue in my opinion. But before we dive into that, I believe in setting intentions and it gives us focus, it gives us purpose, and most important, it gives our audience an understanding of what we should expect from our conversation. So what's your best intention for our discussion?

Taft Love  04:30

I would like for people to walk away with a little more clarity around what they need in terms of operations and how to start down the path to to achieving it.

Brandi Starr  04:44

Awesome. So to start, I like to, you know, start with a really basic question that I think I've asked you know, other guests that I've talked to revenue, about revenue ops with, but I always like to lay the foundation when I'm talking to sell What about their perspective? And so how do you define revenue operations? Like what does it really mean for a business?

Taft Love  05:07

That's a really good question. So if that's okay, I'll dive into a little very brief history. So revenue operations Reb. Ops for short, is a term that is just starting to crystallize in the last couple of years. So for a while, it meant sales and or marketing operations, it meant whatever the person saying it wanted it to mean, there were 1000s of Rev ops teams that were actually just sales operations by another name. Over time, it is sort of solidified as a concept of operation serving the various parts of a revenue org, that doesn't report into its clients functions. So sales operations sits under REV ops, which does not roll into the VP of sales. Same with marketing operations, it's under REV ops doesn't roll into the VP of marketing. And my personal definition is it's three things broadly, it is data, strategy, and systems. And that strategy is really broad includes enablement, and making sure everyone is sort of rowing in the same direction. But rev ops has become very broad. And even now it's starting to evolve even more into a function whose sole purpose is to make sure the customer experience is great. And all of the things that flow into customer experience are things like sales and marketing operations and strategy and enablement. So it's broad. And in fact, it iceberg. It's not even really what we do, even though we call ourselves that, because it's such a broad function today.

Brandi Starr  06:51

Well, you were definitely speaking my love language there. Because I agree holistically. And I want to start diving in a little deeper on one thing you said specifically that I think it is really nuanced that you don't always hear people talk about which is the fact that revenue operations does not report into the functions that it serves. And so I have heard like, I'm a part of a number of cmo communities, or revenue communities where I see this debate taking place in where should rev ops live, like, should it be its own entity? Should it be a holistic revenue team? Should it report to finance should it report, you know, all these different things? And so I'd love to hear you go a bit deeper on why you feel like it should not report into the functions that it's serving and where you think it lives in an organization?

Taft Love  07:52

That's a great question. So let's start with the why it shouldn't report into the functions it serves. What you'll find is when operations rolls into sales, sales tends to expect and get certain outcomes from operations and biases their data in such a way that it it benefits the sales team and marketing. Similarly, when marketing owns marketing ops there, you'll find more often than not, they're they're judged and on things like lead creation, sales is judged on things like win rate, which in a vacuum are not a good representation of their actual value to the team. But they're the things they're good, they have the most control over. And so it's a bit of a fox in the henhouse moment when you have any, any part of the business owning their own operations, which, especially when that operations team is responsible for reporting up to the business their success, that's that's a huge conflict of interest. Beyond that, if you have them rolling into their own siloed orgs, you end up with disconnects. And one of the things that I used to ask CEOs or CEOs who would come talk to us at iceberg about whether we needed them I would ask, go ask your VP of sales, how many leads they received last month? Now go ask your VP of marketing, how many leads they sent to sales last month? And almost every time they came back and said oh my gosh, they're so far off and you realize they don't even have shared definitions because they don't have a shared operations function. So that's the why and the any other question they when you get into ops, size is really important. So who they should roll into depends on the size of the business. If you have five salespeople and three marketers and a VP of Sales and Marketing and CEO then it should probably roll into the CEO. If you're a giant company with a Chief Revenue Officer, a Chief Commercial Officer, that person should probably own rev up somebody who is above the split between sales and marketing. That's sort of the the main criteria, and they have to be above that split.

Brandi Starr  10:14

Yeah. And it's funny, I don't talk about our book a whole lot. But our book cmo to CRO what you're describing, we call it the modern front office in putting all of those revenue people under the same function. So that to use the analogy you gave that we're all rowing in the same direction, and that it is important that they are rolling up to that leader, that is across the board that owns revenue and the accountability to revenue across the table. So I think that is really important. And I want to shift a little bit because you did talk about the different sizes of organizations, and where they should live. Something really common that I hear from smaller organizations, is at what point in our journey? Should we hire revenue operations? You know, there's always this debate about, you know, small company, what's the next hire? What do we really need? So whether it is hiring a person or in icebergs case, outsourcing Reb ops, what do you think that criteria is for a business that says, this is a function that's gotta exist? Wherever the people live?

Taft Love  11:33

It's a really good question. So we're probably talking about smaller businesses, most really large businesses have some operations function. And for them, the question is, should we transition from what we have to Reb ops, it's not when should we hire ops. So let's talk about smaller businesses. I'll define this as loosely as 100 or fewer employees, I think that's a good sort of line in the sand for where companies tend to have dedicated ops functions. So if you don't have operations, then that means your leadership is probably crowd sourcing operations early on. The first thing most companies tend to need is systems. That's the that's the first piece of the rev ops, sort of pillars. That's the first pillar that becomes really unwieldy for a for most small businesses. So I think assuming assuming you're a small business, you're in a place where where you're crowdsourcing systems operations, the point at which you should hire somebody to own it, whether you call them rep ops, sales, ops, marketing ops, or whatever is the point at which it is taking up enough time that you're not getting maximum value out of your leadership, when your VP of sales or marketing is spending an hour or two hours every day in Salesforce or HubSpot or Marketo, or whatever, setting up campaigns and tracking down leads and building reports. Once Once your highest paid employees start to become materially distracted by systems, I think that's the point at which you should start thinking about getting some rev ops help, regardless of whether it's outsourced or in house. That's the point at which you need to bring them in. And it's a really hard thing to measure. But you know, what, when you see,

Brandi Starr  13:24

okay, and then for those larger companies that need to transition from what they've been doing to a true revenue operations function. What is that friction point look like that says, we're at the place that we need to change.

Taft Love  13:41

I think there are a few things you see, that can be and this is a totality of the circumstances situation, there's no one thing that says Now it's time to get Reb ops. But some things you should be looking for in your org are our customers having a smooth experience throughout their whole lifecycle from the first time they hit the website or walk through your door? All the way to if you're a SaaS company, they're renewing, or if you're, you know, a CPG company, they're buying the second or third item from you. Is that a smooth process for them? Or do you need help making sure customers have a smooth journey? Chances are Reb ops has the potential to smooth out that journey. Another thing is, is data becoming a problem do you do you struggle to understand which data is trustworthy and not? And do you have conflicting data from different teams, which tends to happen when politics starts happening in businesses that have their own operations functions? And then the last thing is, if you have systems that span multiple teams, which is pretty common everywhere now, in the 80s, when you know the movie Glengarry I use this as an example, one of the scenes, Alec Baldwin walked in with a bunch of cue cards and said it's the it's the Lee If we got our leads, and that there was a time when marketing generated leads and gave them to sales and marketing shop was done. And now it's up to sales to hunt and farm that lead list. And that was a time when you could get away with having totally different functions. But now, your CRM probably spans 234 functions, you probably have a marketing automation system that is also marketing to current customers who have an a potential expansion or renewal coming up. So as your systems which are increasingly complicated every day span multiple orgs. That's another signal that you know what maybe we need an a function that is sitting outside of the silos to manage these systems that span the silos.

Brandi Starr  15:45

Yeah, breaking down those silos, in my opinion, is one of the key values of revenue operations. So I feel like we've laid a good foundation here for anyone who is interested in just talking more generically about revenue operations as a whole, after finishing this episode, I encourage you to go back to Episode 50, where we talked about revenue operations as a growth driver with Rosalyn Santa Lena. But today, Taft, what I want to do is shift to talking a bit about outsourcing revenue operations and thinking about it from this angle. You know, there's always a debate and different opinions around whether to outsource anything at all, you know, there are some people that are of the mindset that everything should exist in house. I think most people are of the mindset that there is a blur, you know, a blend. But then there is always debate around what should be kept in house, versus what can be done externally. And some would argue that revenue operations has to be internal, that, you know, in order to break down the silos, and you know, all the things we've just been discussing, that you've got to have that in house, I know that you feel differently. So I'd love to hear your thoughts holistically on outsourcing revenue operations.

Taft Love  17:18

You might be a bit surprised by my answer here, I don't disagree with that. I, I named the company iceberg rev ops, when rev ops meant something different than what it means today. I actually think that revenue operations, the full function is not really something you can outsource you can't outsource that unless you outsource the the entire function, you have someone else doing everything for you, which would I don't know of a company that that does that. And so there are elements of Rev ops like we do systems and systems strategy that absolutely can be outsourced. And then the question becomes, where in your growth as a company do you sit today. So if you're a large org, there are plenty of opportunities for you to work with external partners, and they may plug into your Reb ops org. But there is no way that a Yelp could hire a company to come in and own revenue operations own their customer lifecycle internally, that's just not reasonable. What they can do is hire somebody to within the framework of Reb ops build something for them, say they need a new quoting system for their sales team, or they need to take another run at building an attribution framework across their marketing systems. That's a place where you can plug in external parties for Reb ops. Now, if you're like our customers who are all smaller businesses, you might you might want to have Reb ops internally, but a qualified revenue operations practitioner is expensive. So a qualified DevOps team that just includes a leader and one or two wrench workers, it might cost you half a million to a million dollars a year, it is very expensive to do. So if you're a small business just getting from zero to one. That's where we say you should probably start outsourcing elements of rep ops, especially systems, which is the first piece that really starts to get wobbly for growing companies.

Brandi Starr  19:23

I love that answer. Because it is not absolute. And I think that is one thing that you know, as I'm working with different clients, I always encourage people to get away from the all or nothing kind of mentality, or you know, right and wrong or it is or it isn't, because I do agree for a smaller company. outsourcing may be the right thing, because not only are the resources costly, they are also harder to find. And, you know, for a larger company, I definitely agree that it's not like You're not going to be successful trying to outsource the entire function. But there are places that you can leverage external expertise in order to be able to grow. And so I do think that that is a key consideration for everyone listening is where are you in the overall overall organizational growth and maturity scale? And really thinking about what makes sense? What are the gaps? What do you have on your team? Versus what do you need externally? And so thinking about, you know, I don't know if you get asked this question a lot, but just by the nature of what I do, you know, people are always asking me, well, your evaluating client, what kind of questions you know, do you ask to know if they're a fit or not? And, you know, at first, I never really understood why people would ask me that. But then as I thought about it more, I'm like, okay, I get it. Because the assessment of if a client is right for us, or right, for an iceberg, is the same kind of assessment that you have to go through just as an individual to understand what your needs are. And so I'd like to hear from you. If you're, you know, talking to someone trying to figure out if outsourcing all of it or pieces of it is the right thing, what kinds of evaluation points or what kinds of things do you get people to think about?

Taft Love  21:27

It's a great question. Some things I like people to think about. So let me give you, uh, let me let me preface this a little bit. And I think this will help my answer make a little more sense. So a well run operations function, surfaces, trustworthy data, to make good decisions for the business. One way I think of iceberg is, is that we are, we build the compass, so you can steer the ship. And so one thing I like to understand from companies that think they might need our help or help from someone like us, even even if they're thinking about hiring in house, something I like companies to do, is to write down a list of questions in plain English, that you would like to have answers to, in order to better run your business. And some examples of this might be. And honestly, these are some questions that some of our some of our clients can't answer when they come to us our how many customers do we have right now? If 100% of our current customers renew next year, how much money will that be? And so there are some of these questions. What are the things you you either don't have the data or you don't know, if you trust the data that you have? What are the list of questions that you would like to have answered? Because all operations projects? If you start with the question you want answered, you can work backwards and get into the systems and the strategy and a lot of things that roll up into that question and the the answer. And so that's a place where I like for people to start in a conversation that sparks a lot of really great thinking about what you actually need when you start asking these questions.

Brandi Starr  23:12

I love that. And I did an exercise a few years back that ended up kind of being impromptu because I was in a room full of senior people from an organization trying to pull out of them what they wanted to see and reporting. And the question, you know, it should have been a pretty easy answer. And I kept getting all these off the wall things. So it was like, let's scratch that went to the whiteboard. And I was like, tell me any question, any business question you would want answered, to help you make better decisions in your business. And I just wrote them all down, no matter whether they were good questions, bad questions. And then we took it a step further. And I went back and said, If I could give you the data that answered this question, how does it change what you're doing? Yeah. And there were some places where the answer was like really clear, we, you know, modify our service offering, we'd be able to improve retention, all these things. And there were others where it was just like, you know, really no, like, just will be interesting to know. And so those questions were there wasn't a clear, I was like, Okay, we're scratching those off. Like, we're not chasing that information. Because interesting to know, is interesting, but not a priority. And so, although that was a little bit different of a project, what you're saying that is a good exercise in looking at, what do you need to know, you know, or what are you? What do you need to be able to do as well because in some cases, thinking about that customer experience and trying to remove the friction from it, it's not answering questions, it is, you know, taking out that friction point. So defining those It does give you a great starting point to even know what do you need revenue operations, you know, whether internal or outsource, what do you need somebody to be doing?

Taft Love  25:11

100%

Brandi Starr  25:13

So, so I definitely love that there. And what does it look like? Like, you know, we talked about some of the challenges that people have, and you know, what, how to start considering what to do. But I always like to make sure that we don't leave out talking about what's the value? So what do companies who get revenue operations, right? What are the benefits that they experience? Like? What Why is it worth the investment of, you know, time, resources, budget, etc, to really, you know, figure out the data, the strategy and the systems and have a holistic function?

Taft Love  25:55

It's a good question. So something that I can't give an honest answer to, is, what is the best way to measure the ROI of the spins, because if you're being honest, there are hundreds of variables that go into revenue change over time. And so I think you have to think about it, you have to think about it a little more subjectively, when it comes to revenue operations. Some things that you get, are you get your leaders focused on what you actually have hired them to do, especially in a small and growing company, instead of three hours a day, toiling in Salesforce, you have your VP of sales, or marketing, spending those three hours coaching their sales team or working on the next big campaign or event. And so, I think when it comes to Reb ops, it's it's more about clearing barriers from growth, rather than it's not a machine that you put $1 in and you get $2. Back, you can't think of it the way you do Google AdWords, you can't you can't apply, you know, ROI, the way you the concept of ROI the way you do elsewhere. And so the value really comes in preparing your company, for growth. And it is an iterative process. So allowing your company to grow over time, by focusing the people you're hiring for other functions on the functions you've hired them for.

Brandi Starr  27:27

Yeah, and I think that, you know, ability to focus, in my opinion is very underrated. Because I have seen so many situations where the most senior people and you think about, that's where your largest salaries are going. That's where the most expertise and strategic insight lives. Those people are day to day involved in some really tactical things. I remember working with a vice president of demand generation, who was the main email marketer, like I literally was on the phone, troubleshooting emails with her. And it's like, why, why are you You know, you've been in this industry for 20 something years, like, why is there not someone else who would thrive at this doing this. And so although there isn't the direct ROI in the same way, if you look at the time spent, and just what you're paying and salaries, and the missed opportunities, so it's, you know, not clear math, but the missed opportunities by having someone focused in the wrong place, like there's some clear dollars there, or at least some assumed dollars there.

Taft Love  28:49

Yeah. And I think another thing that you just sparked for me that I think is really important is in an ideal world, when you start doing operations, and specifically revenue operations, even if it's your first run at it, and you're just getting your system set up, and you should get more clarity into the mechanics of your business. And so you should be able to answer some of these questions that might otherwise be difficult to answer. When your VP of Marketing who presumably is not an operations professional, is running, marketing and marketing operations, you may not trust the data coming out of that function that tells you what her real losses are or what his ROI on an event is, when you have revenue operations, you can probably have a little more faith in the numbers coming to you. And it allows you to drive using metrics, not feelings.

Brandi Starr  29:51

Yeah, and I think that's a good point. It's also a little bit of a system of checks and balances and also an exercise and accuracy The it you know, I've, as we've been talking, I have so many examples in my head, we were working with a client. And we had multiple teams who sent us data and it was using your example of leads. It was like, well, the events team said they drove this much pipeline. And the sales team said they drove this much pipeline, and the demand gen team said they drove this much pipeline. And it was like, if you added up those numbers, you know, the CEO was like, Oh, we, you know, would have hit our goals three years out if these numbers were accurate. And it was because multiple groups were taking credit air quotes, for the same pipeline. And so that was one of the things that now their revenue operations team is trying to unravel to say, you know, where can you put it on your slide, you know, just something that that basic of when we're reporting to the board, can you put this on your slide and putting, you know, rules around that. And that is that that is the, you know, one of those outcomes, that it doesn't look like you're driving a billion dollars in pipeline, when you know, it's really half a million. And I'm over exaggerating numbers to just for entertainment value. But that is a really, really key thing. And so I think a lot of times when we talk about unlocking growth, we think about growth as in just straight revenue growth. But what I'm hearing is that the growth, leverage from revenue operations, and bringing in external expertise where you don't have them in house or can't afford them in house, the growth is, even though we tried not to say the S word is actually more about scale. And that sort of growth in the business, and not just your your typical dollar for dollar.

Taft Love  32:00

That's absolutely right.

Brandi Starr  32:02

Awesome. Well, talking about our challenges is just the first step and nothing changes if nothing changes. And so, in traditional therapy, the therapist will give the client some homework, but here at revenue rehab, we like to flip that on its head and ask you to give us some homework. So I love to, I'd love to hear from you. What's your one thing, if someone is listening, and they're like, you know, what we need to be looking at how we expand our revenue operations function, whether that's internally or by outsourcing, what's that first thing that they should do next, to move the needle in the right direction?

Taft Love  32:44

think the first thing you should do is sit down with leadership. And I'm thinking specifically for companies that are considering whether rev ops and hiring an operations team if it's the right time for that, sit down with leadership and take stock of how their time is being used. How much of your leadership's very valuable time is being spent every day doing things that an operations team should be handling. And so that's step one, just getting an understanding of how time is being used. Most people probably haven't done that lately.

Brandi Starr  33:18

Yeah, that that is a good one. And it's something that I just as an individual try to do periodically is just take stock of my own time to understand Am I you know, time is the one thing we can't get more of? So how am I using, you know, that finite resource, so I love that as an action item. And even doing that across the leadership team. I think beyond revenue operations, it'll actually be insightful to really understand how much of people's time is really on those activities that are growing the business versus all the other stuff that is on our plates. Absolutely. Well, Taft, I have enjoyed our discussion. But that's our time for today. But before we go, I would love for you to share how our audience can connect with you. And also give us a little bit of shameless plug for what iceberg does.

Taft Love  34:17

Yeah, thanks so much. I appreciate that. So first, connecting with me, you can find me my name is really easy to find. There's only one of me on LinkedIn Taft love. And you can also check us out at iceberg ops.com And so for shameless plug, if you are a leader in a growing startup, small business and you're struggling with all of the choices and work around systems and associated strategy are special specialty is helping small businesses get from zero to one, and bridge the gap from founder selling until it's time to get a qualified in house revenue operations. seem weird that bridge for a lot of companies. And so if you're in that place, contact us. And one thing we do is we sit down and we do a free strategy session with you, just to help you understand where you are operationally, and whether it makes sense to get some help from us or an internal hire. And so that's just something we offer to the community. And we would love to talk to you about that. Awesome. Well,

Brandi Starr  35:23

we will make sure that both the link to your LinkedIn as well as the iceberg is in the show notes. So wherever you are listening or watching this episode, I definitely encourage you to connect with Taft, also, Episode 50, to hear more about revenue operations, and then also Episode 44, where Addy and I debated out what you should insert in house versus outsource. So soon as you finish this episode, gives you some more listening of revenue rehab will tap thank you so so much for joining me.

Taft Love  36:01

Yeah, thank you. I really appreciate being here. Awesome. And

Brandi Starr  36:05

thanks, everyone for joining us today. I can't believe we're already at the end. We will see you next time.

Outro VO  36:13

You've been listening to revenue rehab with your host Brandi Starr. Your session is now over but the learning is just begun. join our mailing list and catch up on all our shows at revenue we have dot live. We're also on Twitter and Instagram at revenue we have. This concludes this week's session. We'll see you next week.