Build A Modern Revenue Engine
Phil Purcell
CRO = Profitable Revenue Growth Specialist I Helping SMEs Further Monetise Their Real Value I Gain Real Revenue Control I Vistage CEO Presenter I Interim CRO I Above-the-line Profit Focus.
Build A Modern Revenue Engine?
If revenue is the lifeblood of any business then predictable revenue growth is the holy grail. The simplest approach for consistent and predictable revenue growth in any business is to build a robust revenue engine.?
In this article, we’re going to:
This is? Part 1 of a multi-part series about building a modern revenue engine for your business.
What Is A Modern Revenue Engine?
Let's start by exploring what we actually mean when we use the term…revenue engine…?
At Rainmaker Revenue, we define the modern revenue engine as simply ‘the total process of the coordinated actions, flows and steps a business utilises to generate and maintain its ongoing income or revenue.’?
?The key outcomes of building a revenue engine for your business are that it makes revenue generation:?
A revenue engine covers every step in the attraction, conversion, retention, and expansion of revenue.
Every Business Already Has A Revenue Engine
If your business generates revenue or income, then you already have an engine.?
This is true of every business but you probably aren't looking at it in that way nor have considered all the options now open to you to optimise its outcomes.?
Your revenue engine doesn't need to be complex and regardless of the size, stage or industry of a business there is a high likelihood you can get a lot more out of your current revenue engine.?
What If You Have One But Don't Know It Or Focus On It?
In our experience, organic evolution from the very conception of a business rather than as a result of any defined strategy, typically means businesses don't realise there is revenue sitting in their business already. These businesses typically don’t look at their revenue generation efforts in terms of an engine, thereby missing the opportunity this unrealised revenue presents and therefore aren’t gaining their best net outcomes.
Many businesses, in a similar stage of growth and with a similar mindset…
And this means lost revenue opportunities that could be easily and cost-effectively unlocked.
Leaving Accessible Opportunity [+ Revenue] On The Table
A business can be profitable and growing without consciously having a revenue engine.?
But without a strategy and without the direction a revenue engine provides these businesses are missing lucrative opportunities? Simply put they are leaving a lot on the table,...the current cost per revenue dollar, along with the potential inconsistency and predictability of revenue that can often get businesses taking action on the subject.?
If you aren't intentionally and strategically looking at your revenue generation in terms of a revenue engine, your efforts can often be more ad hoc and lack the ability to respond to change making it more difficult to tweak and adjust to line up against clients changing needs, market trends and competition.?
A Formula To Build Robust Revenue Engine For Every Business.
Our formula to build a robust revenue engine for any business is as follows
A Revenue Engine Formula
Your Business Goals
Your business goals influence the style of revenue. The direction you want to take the business and desired timeframes should be a key driver in deciding what your revenue strategy and engine ultimately looks like.
There is a range of strategies and styles of revenue that should be considered. If a business, for example, sets the goal of being optimised for sale, in terms of volume and style of revenue, within a year,? it will likely require a different revenue engine setup than one whose goal is steady and sustainable growth without increasing their employee headcount and no plans of selling in the near future.?
Resource Optimisation
One of the greatest revenue-increasing opportunities can come from your current or accessible resources...and most businesses don't understand the extent to which these resources with a revenue spotlight on them can lead.. So it's critical to understand what you have to work with and where the new opportunities and options can lead before diving in and building your engine.?
Resources are typically categorised into four areas…
In our experience, every business can grow its net revenue from the resources and assets they currently have access to. It may be just a few % or it may be 100’s of %.
?Most businesses [around 76%] underutilise the resources at their disposal meaning there's often lots of opportunity for revenue growth currently being unrealised
?
领英推荐
A CRO View…
Reimagining how you look at revenue is the key to unlocking realised revenue in your business.
We call this taking ‘a CRO View’.
A C.R.O. or Chief Revenue Officer’s role is to look across an entire organisation at ALL of the potential revenue influencing areas and put in place an integrated revenue strategy that aligns them all in a way that promotes consistent growth against the goals. This perspective allows you to uncover and recognise where new doors can open up and where you should maintain and further tune.
?
Revenue Alignment
The prevailing model of revenue generation views marketing, sales, and sometimes customer service as separate functions.? This thinking limits a business's ability to develop predictability and consistency in its revenue activities.
Modern revenue engines are built as whole systems, fueled by aligning all the potentially revenue-contributing functions in the business with end-to-end work and data flows that support orchestrated potential and current client engagement.?
Every step and stage is tracked by metrics to encourage continuous improvement and the flexibility to pivot and recalibrate to changing conditions and outcomes.
Alignment ensures that all your resources are working together, in sync…
The Engine
The engine refers to the specific actions and steps your business consistently takes that deliver the desired revenue results.?
To help frame it, think in terms of all the functions that need to occur in any business regardless of its size or industary that lead to or influence revenue, like - attraction, messaging, marketing, sales processes, onboarding processes, client retention and service expansion, upsell etc.
These areas, plus a few more, form part of the Foundation Template/Playbook that lists all the functions and then flows down to the detailed steps and actions, most businesses and revenue models need to execute on a regular basis to attract, grow and maintain clients and subsequently, revenues.
The next step is inputting the primary revenue functions that are important to the business in the order of how they are going to flow, into the Foundation Template.
Think functions that need to be performed and not departments at this point. Deciding who actually does what task comes later.
Then dive deeper into the core functions and start to detail the actions and steps that need to occur on a regular basis. It's important you start from the beginning and work your way through the functions, as the previous step can have a flow-on effect on the subsequent steps.
When the process is done correctly you end up with a business asset that helps onboard new staff, increase scale, provide data inputs, save time and money, lower the cost of revenue growth and acquisition, assist with scale and many other benefits.
?
A Revenue Engine Building EXERCISE
A simple exercise to start the process yourself is:
Document all of the potential revenue influncing functions that you currently have and their primary associated actions and put them in a sequence of how they currently occur.
Then evaluate them by asking if they are effective, are they repeatable, do we do them consistently and do we measure and modify them to optimise the outcomes on a regular basis.
By simply doing this exercise you are starting to recognise what you current revnue engine looks like and areas where you can start to define and refine it for better performance.
One Size Does Not Fit All
Every business is unique, has its own goals and requires a unique revenue engine solution. Even two businesses selling an identical product or service should still approach what goes into creating their revenue engine differently. While in some cases the model may be similar,? the implementation, actions and final strategy will differ..
The Formula Overview?
That doesn't mean that an engine needs to be a complex solution, however. Revenue engines can be very simple in design and implementation, or they can have multiple complexities and technological influences.?
The Benefits Of Building A Modern Revenue Engine
A well-built and finely tuned engine will deliver
Key Takeaway
Every business has a revenue engine… the key to consistent revenue growth is to fine-tune and tweak it in line with your business goals and objectives and through optimising the resources available to your business.??
Conclusion
Understanding what a revenue engine is and the benefits building one will give to your business.? When a business recognises and acknowledges its revenue engine and begins to tweak it in the right way it will increase its scalable, repeatable, and predictable outcomes.
A revenue engine is key to ensuring your business grows and thrives in uncertain times.?
Sound Interesting?
If you want to know more...or you want to build a modern revenue engine for your business.
Send me a message thru Linkedin, an email at [email protected] or choose one of the contact options HERE