It’s that time of year again – budget planning is in full swing. And preparing for 2024 looks different than years prior.
And if we’ve learned anything from the economic challenges over the past year, it’s to be more critical of the technologies that earn a piece of the pie. While many of us previously had the luxury of seemingly unbridled spending, we now find ourselves seeking out ways to discern the optimal areas for investment that yield the highest ROI.
With this, the motto has drastically changed, going from “growth over everything” to “consolidate to elevate.”
In case you missed our latest webinar “Catching Opportunities to Consolidate Your 2024 Budget,” Brad Smith, Co-founder and CEO of Sonar and Feras Abde, Senior Director of RevOps at Outreach, are shedding light on tactics to identify and eliminate redundant tools in your tech stack.
Below, we’re filling you in on the key takeaways from that discussion while also providing an inside look at which platforms warrant investment in tough times.
Tech Stack Consolidation
Currently, the tech space is experiencing a notable trend towards consolidation, a response to the abundance of duplicate functionalities across B2B tech. Consolidating tools is also a great way to free up budget. But before you can jump into just cutting tools, you need to consider a couple of questions:
- What tools are mission critical to get the job done?
- Where is their feature redundancy across your tech stack that can enable you to consolidate?
1. What tools are mission critical to get the job done?
As the RevOps voice gets louder and louder in the decision making process when it comes to necessary tools, the question every leader should be asking themselves is: what tools are needed to get the job done? The fundamentals, of course, include:
- CRM software
- Marketing automation
- Analysis and BI tools
- Sales enablement tools
- Data integrate and management tools
- Project management and collaboration tools
- Customer support and success platforms
- Financial planning and analysis software
And of course, what tools are currently integrating with these core systems that are helping you have full visibility over data, manage compliance, streamline processes for your GTM teams. An indicator of how critical a tool is for your operations is by understanding how closely it integrates with Salesforce. Using Sonar’s new Integration Blueprint feature, RevOps can map and document which systems are reading or being populated by Salesforce data.
The nice-to-have tools no longer have a stake in the game. With tighter budgets in place, the main priority for RevOps teams is determining which tools they can’t function without.
2. Where is their feature redundancy across your tech stack that can enable you to consolidate?
We know… your teams really love particular heat mapping and sales enablement tools. But in today’s ever growing tech landscape, there’s likely a variety of feature overlaps. ANd if one tool can do the same job two are currently doing, it’s time to consolidate where you can. Taking a step back to identify feature redundancies can require a variety of steps. Here’s some tips for where to get started:
- Step 1: Inventory and categorization: List all the tools that are currently being used across different departments. Categorize them based on their primary function, such as CRM, marketing automation, analytics, etc.
- Step 2: Feature mapping: For each category, map out the core features of each tool. This involves detailed documentation of functionalities.
- Step 3: Usage analysis: Access how frequently each tool and its features are being used. You can achieve this through surveys, user logs and feedback sessions to gain insight into actual usage patterns.
- Step 4: Overlap identification: Identifying overlaps where multiple tools provide the same functionality. For example, if your Hubspot CRM measures multi-touch attribution, and you’re also paying for Bizible, you have feature overlap and might be able to identify consolidation opportunities.
- Step 5: Integration check: Evaluate how well the tools integrate with one another. Poorly integrated systems can create inefficiencies even if they don’t have feature overlap.
- Step 6: Cost-benefit analysis: Analyze the cost of maintaining each tool versus the benefits it provides. This should include both direct costs and indirect costs such as user training and support.
- Step 7: Research new technologies: Another important question to ask is are there new tools available today that have the potential to consolidate or displace my current tools and prove a better ROI? Conduct the necessary research to ensure no cost savings opportunities are overlooked.
- Step 8: Stakeholder consultation: Engage with the primary user of each tool to understand their preferences, pain points, requirements and suggest any new tools you have discovered along the way and encourage their feedback.
- Step 8: Trail and testing: Before making any final decisions, trail the consolidation strategies on a small scale to gauge the impact.
- Step 9: Decision making: Based on the findings, decide which tools to keep or replace, which to centralize and where to consolidate.
In this consolidation era, several predictions come to the forefront:
- Increased tech acquisitions: We can expect significant acquisitions to disrupt the CRM market, potentially reshaping industry competition as orgs seek to streamline their operations.
- Monetization being the priority: Tools that were once seen as revolutionary are now shifting towards a more monetized model, highlighting the evolving nature of the tech landscape.
Best Practices for Approaching Budget Cuts
In the quest for securing budget by demonstrating value, several key factors come into play. In order to get approval across the finish line, let’s take a look at what it takes from an internal and external perspective.
1. Empower RevOps to truly own their own tech stack
From an internal perspective, there’s still some maturing that has to happen within companies to truly figure out operations. Companies still look at RevOps like SalesOps, but instead of owning the sales tech stack, RevOps has evolved to own a bigger piece of the pie. In fact, RevOps should be owning the entire GTM tech stack since their work goes across not only sales, but marketing and customer success. In an ideal world, the GTM tech stack should have its dedicated budget falling under RevOps specifically, rather than being sourced from other departments.
There’s a variety of benefits that come from RevOps owning their own budget:
- Tools are critical to their success: Your Revops team is responsible for the architecture and improvement of your customer journey. They and only they will have a true understanding of the technologies that are needed to support it.
- They’ll adjust around the budget as needed: As discussed, there isn’t an endless piggybank of funds and when the money is out, it’s out. And with RevOps already being pros at optimization, they’ll be most critical of where and how the budget is being spent.
- They’ll be more invested: By procuring and owning the tech stack, they will be more invested in end user training, adoption, and monitoring of new features and functionality.
2. Know how to explain the true why behind needing software:
To effectively secure the budget needed, it’s crucial to present a compelling ROI statement when approaching a CFO. This statement should outline not only how much you plan to spend on a tool but also precisely what impact it will have, such as the efficiency it will help drive, the risk it will mitigate or the revenue it will help generate for the business.
The key is to stay focused on the tangible benefits a tool can make, moving it from the nice-to-have luxury category to a worthwhile investment that brings real value. To help, utilize this RevOps ROI Statement to help you clearly communicate the why behind the tools you absolutely require.
As we approach 2024, it’s clear that effective budgeting is more crucial than ever. Brad Smith and Feras Abde offered fresh insights and innovative tactics to put into action including weeding out redundant tools, informed investment decisions, and how to resource your team in today’s market. As you prep your 2024 budget, be sure to watch the full, ungated session here.
As budgets get tighter, the ability to do more with less becomes critical. Especially when it comes to your CRM. To help streamline processes and avoid devastating breaks, Sonar is a must-have for RevOps teams. But don’t take our word for it. Try Sonar for yourself today.