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Why silos are stunting your company’s growth

It is no secret that inefficiencies can be a major source of lost revenue in today’s fast-paced business world. The most common inefficiencies we have encountered include poor system implementations and integrations, bottlenecks, lack of insight, loss of operational performance and silos.

A recent study by International Data Corporation (IDC) revealed that companies lose 20 to 30% of their revenue due to inefficiencies each year. Silos constitute a significant problem for many businesses. Understanding how to prevent or fix them is key to staying competitive.

Companies can eliminate problems like silos and achieve competitive advantage by adjusting their revenue operating models. Changing their approach to generating and capturing revenue creates better value for companies and customers.

The problem with silos

Traditionally, divisions typically operate independently in business. Each has its own operations team and specialises in the functions it serves. This structure encourages heads of departments to determine their priorities. For example, the director of sales operations decides their team’s goals and objectives. Likewise, the head of marketing sets the expectations of the team.

In most cases, this approach works. However, it fosters an environment of competition rather than cooperation. This creates silos, with each department operating individually with varying goals, incentives, and priorities. As a result, it obstructs the free flow of information, and the coordination between departments deteriorates. Ultimately, this leads to a loss of revenue and wasted time resolving issues created by a lack of cohesion.

Why RevOps are needed

RevOps is not a function but a way to better align a company. It addresses challenges created by siloed operations by aligning revenue goals throughout marketing, sales, and service teams. According to SiriusDecisions, organisations that focus on alignment achieve up to 19% faster revenue growth and up to 15% higher profitability than other companies.

However, simply thinking of a revenue operations function that encapsulates marketing, sales and customer success is limited. Silos affect all areas within a business – even if only one department operates in such a way – they have a domino effect.

RevOps owns the operating engine of a company. It ensures that proper infrastructure is in place for each business area. It equips and empowers a company to perform to its maximum potential. It allows more streamlined operation for added value, engagement, collaboration and feedback.

The advantage of using RevOps is that it is a powerful operating model that drives efficient, predictable revenue. Some specific approaches include adopting a lean, agile GTM (go-to-market), moving to a data-driven decision framework, and building a resilient, forward-looking organisation. According to McKinsey & Company, centralising GTMs and creating agile operating models have a domino effect, which can achieve a 20%+ ROI in sales.

Finally, RevOps guarantees all GTM departments are centralised, moving towards the same goal; keeping every department accountable to revenue. It ensures that every initiative has a measurable impact on every aspect of business operations, from awareness to expansion. According to SiriusDecisions, this alignment can drive up to 36% of your growth.

Catherine Mandungu is the Founder of Think RevOps


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