What are good OKRs for revenue operations?

First and foremost, whatever the OKRs you choose need to check two basic principles in my opinion:

1.Alignment with Business Objectives: Each OKR has to be directly tied to the broader goals of the organisation, ensuring that the efforts in RevOps contribute tangibly to the company's overall success.

2.Passing the "So What" Test: The chosen OKRs must be crafted not just to track activities but to generate meaningful outcomes. They should answer the "so what" by demonstrating how each key result impacts the business either by driving growth, efficiency, or helping with market expansion.

Here are some examples of some good OKRs you may want to start with:

Objective 1: Improve Sales Efficiency

• KR1: Increase the lead-to-close rate by 15% by the end of Q2.

• KR2: Reduce the sales cycle length by an average of 10 days by Q3.

• KR3: Implement a new CRM system with at least 95% adoption rate among the sales team within 4 months.

Objective 2: Enhance Customer Retention and Expansion

• KR1: Achieve a customer retention rate of 90% by the end of the fiscal year.

• KR2: Increase upsell and cross-sell revenue by 20% by Q4.

• KR3: Implement a customer feedback loop, achieving a 50% response rate, to inform product development by the end of Q3.

Objective 3: Optimize Revenue Operations Processes

• KR1: Automate 30% of manual reporting tasks by the end of Q1.

• KR2: Reduce operational costs by 10% while maintaining or improving service quality by the end of the year.

• KR3: Develop and launch a training program for new RevOps tools with 100% team completion by Q2.

Objective 4: Strengthen Data-Driven Decision Making

• KR1: Increase the accuracy of sales forecasting by 25% by Q3.

• KR2: Implement a new analytics dashboard used by 100% of the sales team weekly by Q2.

• KR3: Conduct quarterly data audits to ensure 98% data accuracy across all sales and customer platforms.

Objective 5: Expand Market Reach and Revenue Streams

• KR1: Launch two new product lines contributing to a 15% increase in total revenue by Q4.

• KR2: Enter two new geographic markets, achieving a sales target of $X by the year-end.

• KR3: Establish three new strategic partnerships that enhance product offerings by Q3.

Each of these objectives tackles a different aspect of Revenue Operations, from sales efficiency and customer retention to process optimisation, data-driven decision-making, and market expansion. The key results are quantifiable and time-bound, providing clear targets to aim for. Remember, OKRs should be reviewed and adjusted regularly to reflect changes in the business environment and organisational priorities.

Since what constitutes a good OKR is contextual by org, I'll share guiding principles I use to develop strong rev ops OKRs:

1. Align OKRS directly/indirectly to the company's top priorities

2. Vet OKRs with key stakeholders in the org

3. Define OKRs with key results that are easily understood and measurable

Company Alignment - you define OKRs to ultimately help your org/team achieve your company's top priorities. If you can't easily articulate how your OKR helps achieve a top company goals, consider revisiting its definition so that it does. Otherwise you'll misdirect valuable resources that are focused on progressing the wrong priorities.

Vet OKRs w/Stakeholders - you risk undermining OKR adoption and achievement of targets if you don't get buy in from the parties that will own the OKR. I've seen too many times where rev ops defines OKRs in isolation without obtaining feedback from the sellers that own it. Sellers then make little to no effort taking action against the OKR. Make sure you involve the parties responsible for owning the OKR early on in the definition process to maximize OKR success.

Define Measurable and Straightforward OKRs- while this sounds pretty obvious, I've regularly seen key results - especially in teams with highly technical and analytical staff - that are too generic or difficult to measure (e.g. >X% of new opportunities use consistent software deployment configurations). If you find your audience struggling to understand the OKR definition or how to take action and/or have no idea how to actually measure the key result attainment, chances are you need to redefine the OKR. Remember, the simpler the OKR, the higher likelihood of its adoption.

At a high level, there's generally two buckets of metrics that Sales/Rev Ops teams look at that are fundamental to understanding the health of the business: revenue generation and revenue retention.

1. Within revenue generation, the main three categories of KPIs are pipeline execution/progression, pipeline generation, and pipeline coverage.

   • Pipeline progression and execution is about how much of the existing pipeline the sales team has progressed (matured from one stage to the next) or closed (booked $'s). Focus is on current quarter. Typical KPIs are $'s booked, the amount of pipeline in various stages of maturity, and close ratios. For $'s booked, the two main levers we evaluate are $ attainment vs. target and Y/Y growth. Both are important because they measure different things. Targets measure expectations. Y/Y growth measures pace. You can have a product growing 100% Y/Y (fast pace) but it could still be short of targets because expectations are even higher.

   • Pipeline generation and creation is about how much pipeline is being created. Focus is on future quarters, with longer timeframe ranging from Q+1 to Q+4 or even Q+6 depending on length of the sales cycle. Typical dimensions that pipeline generation are tracked against are:

     • Creator type - who's sourcing the pipeline? Is it a BDR, an account executive, etc.? This matters because oftentimes, different sources of pipeline will have different rates of conversion.

     • Pipeline composition - what's the product mix of the pipeline? What's the deal type mix? Is it a lot of upsell? Cross-sell? Are we building enough pipeline across the portfolio?

     • Close quarter - when is this pipeline expected to close? Are we building a lot of pipeline for the near-term and medium-term future?

   • Pipeline coverage is the amount of pipeline in flight. Focus is typically on immediate next quarter. The KPIs ops and sales will focus on are coverage ratios - the ratio of pipeline in a given timeframe vs. the sales targets for that timeframe. E.g., if we have $100m of pipeline against a $25m target for Q2, then we'd have a 4x ratio. This is typically the main early indicator of future success, but there are many other ways you could investigate this, including looking at mature vs. total pipe coverage. Looking at historical conversion rates, and in-quarter create and close rates, etc. to understand what is "sufficient" coverage.

2. Within retention, the main categories of KPIs are attrition, renewals, and usage/adoption.

   1. Attrition - this is a fun one. How much revenue did you lose from existing customers. Typically this is measured against targets. Very straightforward to understand and typically broken up into full attritions and down sells.

   2. Renewal Rates - very similar but rather than absolute $'s lost you look at %'s. Two flavors of this that I've typically seen. Renewal rates against RBOB (renewal book of business) and Retention rates against BOB (book of business).

      1. RBOB Renewal % - of the $'s that were up for renewal this year (or quarter), how much of it did you renew?

      2. BOB Retention % - of your total annual recurring revenue, how much of it did you retain?

   3. Product Usage/Adoption - are customers getting the most out of their existing products? What's their usage % (# licenses utilized, # activations, etc..)?