SaaStr - Live Workshop Wednesday: What to Expect from Your New CRO/VPS with Zensai's CRO
The conversation highlights the critical role of a CRO in aligning with the CEO and executive team to drive commercial success. Kathy Lord, with extensive experience in sales leadership, shares insights on what CEOs and founders typically expect from a CRO, primarily focusing on sales and revenue growth. The discussion emphasizes the importance of understanding the company's stage and aligning expectations accordingly. For instance, a company at $3 million ARR may need a different approach than one at $30 million ARR. Kathy stresses the need for a CRO to have a strong understanding of the business, market, and pipeline, and to develop a clear action plan for scaling the organization. She also discusses the differences between a CRO and a VP of Sales, noting that a CRO should focus on strategic alignment and scalability, while a VP of Sales is more involved in day-to-day revenue operations. Practical examples include developing a go-to-market strategy, aligning sales resources, and creating a consistent revenue operating model. The conversation also covers the importance of clarity, alignment, and empowerment in ensuring the success of a new revenue leader, and the need for CEOs to remain engaged in sales processes even after hiring a CRO.
Key Points:
- Align expectations between CRO and CEO from the start to avoid misalignment.
- CROs should focus on strategic growth and scalability, while VPs of Sales handle daily operations.
- Develop a clear 90-day plan with actionable steps for the CRO to follow.
- Ensure cross-functional alignment with marketing, finance, and product teams.
- CEOs should remain involved in sales processes to maintain market insight.
Details:
1. 🎙 Introducing Kathy Lord: Insights into CRO's First 90 Days
- Kathy Lord, currently CRO of Zeni, has a notable career trajectory including roles as Director of Sales, VP of Sales, and COO at Intacct, which was acquired by Sage for $1 billion.
- She remained at Sage for several years post-acquisition as a GM/COO, underscoring her leadership acumen in both startups and large public companies.
- Kathy recently transitioned to a mid-stage scale-up, Zeni, with approximately 225 employees, marking a significant shift back to a more hands-on sales leadership role.
- Her decision to join Zeni offers insights into the strategic considerations and expectations for a CRO in the first 90 days at a mid-sized company.
- The discussion aims to reveal realistic expectations and strategies for CROs in similar transitions, drawing from Kathy's extensive experience.
2. 📋 Aligning Expectations: Navigating Executive Misalignment
2.1. Importance of Aligning on Goals and Expectations
2.2. Key Areas to Address for Commercial Success
3. 🔄 Understanding CEO Needs and CRO Capabilities: A Dual Perspective
- CEOs and Founders prioritize sales and revenue, with needs varying by company stage. At a few million ARR, focus is on product-market fit and identifying the ideal customer profile, target markets, and the right feature set.
- At 20-30 million ARR, the focus shifts to scalability and predictability, requiring clarity and intellectual honesty in understanding organizational stage and alignment of ambitions.
- Misalignment often occurs between CEOs and CROs due to differing perspectives, especially concerning whether a company needs a CRO or a VP of Sales, which depends on the company's size and stage.
4. 📈 Building Foundations: CRO's First 90 Days Blueprint
4.1. CRO's Initial Approach and Strategy
4.2. Execution Strategy and Metrics
5. 🔍 CRO vs. VP of Sales: Defining Roles, Expectations, and Strategic Focus
5.1. Assessment of Revenue Organization
5.2. Culture and Alignment
5.3. Revenue Operating Model and Consistency
5.4. Action Plan and Cross-Functional Alignment
5.5. CRO vs. VP of Sales Role Differentiation
5.6. Go-To-Market Strategy and Ideal Customer Profile
6. 🔑 Alignment, Success Metrics, and Organizational Culture
- Initially, the sales team lacked a focused market strategy, spreading resources across 50 countries with a 'one size fits all' approach.
- A strategic shift was implemented to align resources with the ideal customer profile (ICP) and market strategy, leading to a more organized resource distribution.
- A global Revenue operating model was introduced to standardize working methods, addressing vision, strategy, behaviors, beliefs, and communication.
- The model incorporates structured revenue cadences for new logo acquisition, expansion, and retention, emphasizing data-driven improvement and clear performance expectations.
- Accountability and success measurement frameworks were established across a 70-employee global revenue organization to ensure consistent performance.
- A methodical approach to funnel measurement was adopted, focusing on data-driven resource allocation on regional and global levels.
- A three-quarter action plan was initiated after the first 30 days, detailing strategic transformations to fulfill organizational ambitions.
- The initial 90-day plan highlighted the importance of organizational focus and clear communication of anticipated changes throughout the organization.
- The process includes identifying immediate versus future organizational needs, particularly in sales leadership investment to meet growth targets.
7. 🚀 Empowerment and Clarity: Keys to Sustainable Growth
7.1. Importance of Role Clarity
7.2. Pattern Recognition and Alignment
7.3. Cross-Functional Alignment
7.4. Empowerment and Decision Making
8. 🤝 Ensuring Cross-Functional Alignment and Empowering Leaders
8.1. Empowering Revenue Leaders
8.2. Aligning on Revenue Plans
8.3. Data-Driven Decision Making
8.4. Strategic Planning and Execution
9. 🔧 Exploring Demand Generation and Revenue Leadership Dynamics
9.1. Evaluating and Committing to Revenue Plans
9.2. Ownership of Demand Generation
10. 📊 Strategic Decisions: Topping a VP of Sales
10.1. Demand Generation and Sales Leadership
10.2. Topping a VP of Sales
10.3. Cultural Dynamics and Leadership
11. 🛡 Open Conversations on Growth and Performance
11.1. Transparent Conversations on Scaling VPA Sales
11.2. Challenges in Honest Conversations
11.3. Decision Between VP Sales and CRO
11.4. Adaptation of Founders in Evolving Roles
12. 🤔 CEO's Role in Sales and Leadership Dynamics
- Clear alignment between the CEO and sales leader is crucial for role clarity and preventing miscommunication.
- CEOs must trust the sales leader to manage sales independently while providing necessary support and visibility.
- Maintain open communication to ensure both parties understand their evolving roles and responsibilities.
- CEOs, especially product-focused, should remain involved in sales to understand market needs and customer feedback.
- CEOs should allocate 10-20% of their time to engage with customers and partners.
- Hiring a strong sales leader should not mean complete withdrawal from sales for CEOs; they should remain involved in key deals.
- If a CEO finds they have completely stepped away from sales, it may indicate insufficient leadership in the sales department.
13. 👋 Wrapping Up: Future Goals and Reflections
- Staying engaged with customers and the market is crucial for ongoing success.
- The goal is to reach $100 million in annual recurring revenue (ARR) as a milestone, with a future target of $1 billion.
- Continual learning and adaptation are necessary for achieving these financial targets.