I was looking forward to this interview. From establishing sales strategies at early startups to developing and running a full-scale sales operations team of 40, Tom's brain is worth picking! He's now Senior Vice President Global Sales Operations and Commercial Sales at Fuze and I was interested to learn more about his path into sales operations whilst uncovering some gems of knowledge for the community. We discussed Tom's productivity model for measuring the success of a sales ops function, rolling out new processes and making them stick, moving the needle on rep productivity and ramp up time, working with sales enablement, and more!
Rory Brown (RB):Perhaps you could tell me a little bit about yourself and how you made your wayinto sales operations?
Tom Siegel (TS): I would say it started when I began at myfirst startup about 15 years ago. I was a VP of Sales there but I ended up runningeverything, from commission to building rules of engagement. That continued forthe next two startups I worked at thereafter – and being such early stagestartups, we did not have the luxury of any formal sales operationsdepartments. Unbeknownst to me at the time, I was basically doing salesoperations as a function of my wider sales role, so that was my initialbackground. When I joined BMC Software, I was originally recruited to developand run a full-scale sales operations team of 35-40.
RB: So, looking atthe VP sales role and the VP of sales ops role, what are the fundamental thingsthat you think both roles are covering and where do they split?
TS: Well firstly, there is typically no revenue contributionon a VP of sales ops role, whereas on a VP sales role, you are always driving arevenue number. Secondly, in my world, the VP of Operations role also carriesChief of Staff responsibilities. In this role, you take on the responsibilityof being a chief of staff because you are thinking very similarly, whether itis about channel coverage, quota and compensation, or rules of engagement. Andbecause I’ve done the role on the revenue side, I have gained the respect andconfidence to give our CRO guidance.
RB: You’ve mentioned that the VP of Sales has a revenue number that they’re chasing, and the VP of Sales Ops doesn’t do that directly. So, what is success for a sales ops function and have you seen any ways of measuring that?
TS: Yes, absolutely. If people ask what our mission statement is, it’s to increase the efficiency and productivity of the field sales organization. There are different ways of measuring that. Here we base it on sales rep productivity and we have built a productivity model that drives the hiring, the coverage, the success and the metrics of a region. So if you are expecting a certain amount of productivity from a rep, you can measure that using data such as when they come on board, how productive they are on a quarterly basis, and even look at their attainment vs the quota to see who is operating with a headcount that is below productivity.
RB: Nice. Could youexpand on that model a little more?
TS: Sure. We have developed such a model that incorporates aramp for each role - enterprise rep, mid-market rep, inside rep, and so forth.which is really just an expectation on how long it would take them to reachfull productivity - it could take 3 months, 6 months, or even 12 months toreach the stage where they are fully hitting their target. We model that withother assumptions like their quota, the ramp, the churn per quarter and soforth. We then put that all into the model and it gives us an expected coveragerate. Then you can start tweaking the assumptions to see what the impact ofchanging a ramp or the impact of decreasing churn would be on your productivity. As an example, if yourproductivity is too low that could mean changing your quotas or adding moresales reps. We call that your productivity model and that’s what we drive ourbusiness by.
RB: I really likethat, thanks. When looking at the insights that you get, how much of those aregoing to your CROs and VP Sales level to help them, and how much of it is goingup to help set expectations with your C-level?
TS: It goes to both, the Executive team as well as the Regional Vice Presidents. Productive Capacity is referenced on Weekly Executive Forecast Calls as well as weekly regional forecast calls. It is definitely in the water supply and if you were to speak to someone in Finance, Sales or even HR, they would be able to clearly explain what productive capacity is and why it’s important to not only Sales but the company.
On the same note, we build the productivity model so thatwhen we come into our budgetary period, we can work with finance to ensure wehave the productive capacity to meet our growth targets. For example, we willrun the productivity model based on the current head count that we have, thengo back to finance and say, ‘based on these assumptions, if you want us toachieve 100 million dollars of bookings, the model shows we can only do 94’.So, as a company we need to build that into our headcount plan. We have a verygood cadence with them, and they understand the productivity model across theboard.
RB: One of the bigproblems for people in the community will be rolling out new processes andmaking them stick, making them tight, and making them useful for everyoneinvolved. How do you go about rolling out a process and making sure that itsticks?
TS: It can be challenging for sure. It really comes down tocommunication, enablement and accountability. As an example, in a previouscompany we built a Deal Desk to review every deal over a certain dollar amount.The goal of the Deal Desk was to ensure that the deal was structured correctly,had appropriate discount levels and met the company’s rules around revenuerecognition. Before launching the Deal Desk, we communicated to the sales forcevia email and webinars on how the Deal Desk worked, why it was being rolled outby the company and what it meant to the sales teams. We then offered weekly“Office Hours” to answer any questions post communication. Finally we ranweekly reports out of SDFC that measured what deals were already reviewed bythe Desk and which deals were not. Any deals that should have been reviewed bythe Desk but hadn’t were escalated to the EVP of sales. It didn’t take long,maybe one quarter, until the Deal Desk reports had very little escalations andwere an integral part of the Sales Cadence.
RB: Thats sounds likean excellent plan. It seems like potential rep productivity and ramp up timeare areas of focus for you. When you look to move the needle on those, how doyou go about identifying the right data points to observe these measurables?
TS: In BMC days we had a very simple productive ramp. Insidesales reps were expected to have 3 months of low productivity and be fullyproductive by 4 months. Outside sales reps had 7 months to reach fullproductivity. That is how we started the model and built quotas; it was simple.Fast forward to where we are now, and it’s a bit more challenging, especiallyin the Telecommunication Industry where sales cycles can get very complex andcompanies take longer to make strategic decisions. So to try and get asaccurate data as possible in regards to ramp, I have my team build a cohort ona pool of reps, twice a year, to ascertain how much they are selling and howquickly they are selling it. These cohorts provide the foundation for the rampthat we use in the productivity model.
RB: Let’s say youguys want to improve your ramp. Where would you identify how you might do that?
TS: Sales enablement is one of the KPIs that we focus on. We try to find where enablement needs to focus. We look at the velocity of an SDR moving stage to stage and identify what areas they are getting stuck in. We also use things called ‘leading indicators’. They are the number of direct meetings, new partner meetings, and what we call ‘visible opportunities’ that have a certain monetary value, customer commitment and so forth. They need to have so many of these opportunities per quarter, because it correlates to their sales productivity. If we see that their leading indicators are dragging, we compare that to their attainment, and we decide whether this person needs more enablement. If so, we put them into a pitstop and we reinforce certain areas. And the whole objective of that is increasing their positivity and decreasing their ramp.
RB: A pitstop – that’s a nice idea.
Let's talk about turning insights into action. Say you discover an insight through data, what’s the process in taking that to the right people and turning it into something that happens as a result of it?
TS: At one of my previous companies we had to build a dealdesk. After the close of every quarter we would review the amount of deals thatwere reviewed by the desk to see if there were any trends that we foundinteresting. In one case we found that for a specific product line almost everysingle deal was at a 90% discount, and our average discount overall was about40%. I took that data to the SVP of that product line and highlighted theconsistently high pricing on his product lines, which was making us provide a90% discount. He said that frankly he hasn’t checked the pricing in a while,and I suggested that he should look at the competitors, because that trend isway too high. Subsequently he adjusted his list price to be more in line withthe market and we saw our discounting fall more in line with the companyaverage.
RB: A good example,thanks. How much of your role consists of that kind of ‘practice recovery’ asopposed to dealing with requests and ongoing processes that are part of thestrategic picture?
TS: The amount of practice recovery in sales ops really varies by size of company. In the larger companies, where you have bigger teams, you often have the luxury of being more strategic with the data. In smaller companies there is more firefighting going on so the practice recovery is less as you are personally dealing with these fires. It also depends on how extensive your tech stack is as well. Smaller companies may not have the luxury of an extensive tech stack and be limited to only a CRM and maybe only a single analyst or admin. We are fortunate here at Fuze in that we have a deep tech stack that allows us to look at data and act upon that data in a more proactive nature.
RB: How do youprioritise where you look first? Is there a system or is just random?
TS: We have a rhythm - there are QBRs which are on the salesside, and we have a monthly operating rhythm which is on the company side. Myteam is building the presentations for both. At least once a month we arebuilding the monthly operating rhythms, looking at the specifics of everythingwe have talked about today as well as the qualified pipe and the metrics aroundthat.
RB: If you take the relationship between you and a VP of sales, what kind of famous double act or duo could you liken to that relationship, and why?
TS: It depends on the relationship between the two and howvaluable they believe the operations role to be. There have been some that Ihave had a strong relationship with – one VP even took me to India with him,and I was like his proxy. That is when you know that you are providing value.If they believe that you wholeheartedly have their back, they give you fullresponsibility and they trust what you are telling them – I would liken it toBatman and Robin.
RB: That’s a sensible answer. It’s been a pleasure Tom.
Want to get more insights from sales ops leaders? Check out our other interviews in the sales ops interview series.
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