Having clearly defined business practices and policies is critical to enable continued growth.
Key takeaways
Teams should take a holistic look at how automation might benefit various parts of the business.
Improving customer journey processes becomes more important as business grows.
Established technology companies that have experienced rapid growth reach a point where they are often looking to scale technological aspects of their business to reach operational maturity. Doing so can help them ensure a consistent, reliable service and/or product for their customers.
Companies that reach this stage should be strategic about decisions to upgrade and adapt aspects of their operations rather than investing in a host of new technologies for the sake of it. Knowing where to focus your team’s efforts is a critical factor in determining the business’s continued success.
There are three essential areas leadership teams should focus on to foster operational maturity during this stage: defining business policies and an operational framework, harnessing automation and streamlining customer processes. And while these actions will be useful no matter the economic environment, times of potential downturn underscore their importance.
1. Define business rules, policies and operational framework
Having clearly defined business practices and policies is critical to enable continued growth. These practices and policies include defining the company’s product and bundling strategy, its go-to-market strategy, the product catalog and a formalized approval process. Getting standard contracts and terms in place—as well as identifying standard exceptions—is another important aspect of defining business policies.
Teams should ensure an operational control framework is in place to capture who owns which processes and responsibilities and how the teams will monitor and manage various risks. This framework should also address who has oversight of deal approval.
Companies should also invest more in key operational functions, including sales operations, renewal operations and the deal desk function, and ensure these functions are positioned to provide strategic value, not just administrative support.
2. Harness automation
Automation can be critical for technology companies throughout the lifecycle, but especially further up the growth curve when a business has clear, repeatable processes in place and has already reached a significant volume of customers.
Teams should take a holistic look at how automation might benefit various parts of the business. For instance, this might look different from a human resources perspective than from a finance perspective. One crucial area where automation can improve efficiency is the quote-to-cash process. Using technology to automatically handle amendments, extensions, renewals, upgrades and terminations can result in significant process improvements and reduce errors and delays. Companies can also use automation to streamline tiered pricing structures.
Integrating various software solutions can also boost the reach of automated capabilities. For example, NetSuite can easily integrate with Salesforce for complete lead-to-cash automation, Avalara for tax automation and compliance, and Concur for expense management. Leadership teams should assess where there may be opportunities to maximize the capabilities of such technologies when combined.
As part of harnessing automation, companies taking steps to reach operational maturity should seek opportunities to upgrade, integrate and be intentional with the various components of their tech stack. Taking steps to reach operational maturity will involve assessing the compatibility of systems in the current tech stack and ensuring those tools enable a streamlined experience for both customers and employees.
3. Streamline customer processes
Improving and updating processes involved in the customer journey becomes increasingly important as a tech company grows. A key inflection point is around the $80 to $100 million revenue mark; at this time, growth and volume can become difficult to manage, and revenue leakage may be more likely to occur.
Businesses need to evaluate the ease of a variety of customer processes, including intake, renewals and price changes. For many companies, improving the customer experience will necessitate the implementation of cross-functional processes that break down operational siloes. Needs may vary depending on whether the business uses a more traditional, transaction-based model or a subscription-based model.
Much like integrating various software solutions can create greater returns for automation, such integration can also help give a more accurate, 360-degree view of the customer. Still, it’s important to keep the capabilities of technological tools in perspective.
We continue to see the buying of technology solutions to solve a retention problem when really the technology should enable the humans in an organization to have a better understanding of and have better interactions with the customers.
Kim Susko, principal, RSM US LLP
A proactive approach is essential to all of these key focus areas. Technology companies should not wait until a time of crisis to implement automation or improve processes. Businesses that move quickly and decisively to adapt their operations in these three areas will be set up for greater success as they mature.
Related insights
