Demystifying Operating and Data Models in Revenue Strategy

Operating Models: The Blueprint of Your Revenue Strategy

Think of the operating model as the blueprint for your revenue strategy. It defines the underlying process of what you're trying to achieve. An operating model lays out the steps in a process, such as a marketing funnel (awareness, consideration, conversion). It guides how your team executes activities and influences various aspects of your business, from reports to strategies, Performance Indicators (KPIs), tool selection, team structure, and skillsets.

Even if you're not consciously aware of it, your company operates within an underlying operating model. It's essential to recognize and define this model, as it sets the stage for alignment across your entire organization. Without a clear operating model, your team may work in ways that aren't fully aligned with your objectives.

Data Models: Measuring Success and Efficiency

Alongside the operating model comes the data model, which defines the core KPIs used to track your progress. The data model is crucial for evaluating whether you're on track or encountering inefficiencies in your process.

In a traditional data model, a typical journey might involve leads turning into Marketing Qualified Leads (MQLs), Sales Qualified Leads (SQLs), and finally, customers. This data model is closely intertwined with the operating model, as they work together to guide your revenue strategy.

Tech and Tools: Building Around Existing Models

Your choice of technology and tools is significantly influenced by the prevailing operating and data models within your organization. Tech vendors build solutions that align with the operating models companies already use because it's more straightforward to cater to existing needs than to persuade organizations to adopt new models.

For example, when Account-Based Marketing (ABM) gained prominence, vendors adapted to accommodate the shift in operating models, which now measure opportunities instead of leads. Understanding this dynamic helps you navigate technology decisions more effectively.

The Five Core Stages of Revenue Strategy (per Chris Walker )

Revenue strategy can be broken down into five core stages, each building on the previous one:

1. Adopt an Operating Model: This is where you establish the framework for how your organization operates.
2. Define the Data Model: Identify the KPIs that matter most and are aligned with your operating model.
3. Craft Revenue Strategies: Develop strategies based on your KPIs, rather than the other way around.
4. Choose Tech and Tools: Select the tools that best support your chosen operating and data models.
5. Execute Tactically: Execute tactics that align with your strategies, leveraging the chosen tools.

The Need for a Unified Revenue Team Framework

The future calls for a GTM operating framework that bridges the gap between marketing and sales methodologies. This unification is crucial for achieving alignment and optimizing your revenue strategy.

Understanding and defining your operating and data models is paramount in revenue strategy. When these models are clear, your organization can operate more cohesively, choose the right technology, and execute strategies with greater efficiency. Keep asking questions and sparking discussions; it's through collaboration that we can refine and improve these concepts.