BizOps. CustomerOps. SalesOps. ProductOps. PeopleOps. It seems “Ops” is in everything these days. If you haven’t seen what Ops actually does in a few startups, it can be challenging to understand what Ops is and how it can help.
Technical founders in seed and series-A stage especially are grappling with this question; I get asked about it regularly. Young startups are the main audience for this post. My goal here is to define Operations, give some examples of how Ops can help, and cover when hiring an Ops person/team may make sense.
What comprises Ops?
There are core functions, and then there are functions that help other functions. “Ops” can be used to describe both, which makes things very confusing.
“Operations” can mean core functions other than Engineering, Product, and Sales in a small startup.
- Customer support (answering tickets, designing the help center and running a peer-to-peer community) and/or customer success (typical in B2B contexts, takes care of customers post-sale from onboarding to retention) can be lumped under the “Operations” umbrella.
- People Operations typically comprises HR, Recruiting and sometimes Real Estate/Office.
- Accounting arises as a function needed by a revenue-positive startup earlier than many other functions: clients need to be billed, financial statements need to be put together.
- Supply Operations is a rather standard team in marketplace companies these days. This type of team will make sure there’s enough supply (drivers, data labelers, therapists) to fulfill the demand driven by Marketing and Sales.
“Operations” can also refer to functions that help other functions. This designation usually materializes later in a startup’s lifecycle when there are functions to help and not everything is done by the same 10 folks. You won’t find all these functions separated out in a small startup; the descriptions below are for these teams at series-C+ companies, in which you can actually start seeing the separation.
- Sales Operations makes sense only in companies that have sizable sales teams. SalesOps takes on non-customer-facing work so Sales reps don’t have to do it: strategy (e.g., which regions to go to with which products, how to split territories between reps), operations (e.g., what Rules of Engagement reps should follow, dashboard building), and enablement (e.g., sales methodology, training and coaching).
- Marketing Operations is a platform team behind Marketing. In the absence of a centralized BizTech team (see below), MarketingOps deals with Marketing systems and processes, typically related to Growth work. These include SaaS tools like Marketo that help marketers run campaigns and processes like campaign building.
- Customer Operations (a.k.a. Customer Experience Operations), like MarketingOps and SalesOps, helps Customer Success with processes and systems.
- Business Technology (a.k.a. TechOps) can be part of SalesOps or a standalone team. BizTech’s job is to manage and build internal tools for Go To Market teams, thereby codifying business logic and automating manual processes (e.g., in Salesforce).
- Product Operations can be a glue function between Product and Customer Support. ProductOps folks act as junior PMs, know the product extremely well, act as experts for customer issues and help surface those to PMs.
- Pricing may or may not be a team of its own, but there’s typically someone in charge of pricing who isn’t the founders at this point. If it’s not a stand-alone team, Pricing will typically sit in BizOps, Finance, or Analytics.
- The triumvirate of Analytics, StratFin and FP&A don’t have the word “Ops” in their name but can be done by the same people as some of the other functions here. Analytics typically comprises “people who know SQL and our company’s data structure” so they can answer complex questions like “what’s our churn by cohort.” Strategic Finance deals with things like the company’s financial model and plan, fundraises and M&A. It bleeds into Financial Planning and Analysis (FP&A) whose job is to help the leadership prepare a financial plan and track performance against it.
- Business Operations (BizOps for short) can mean any combination of the above. It can also mean a specialized group of problem solvers and project managers who run the company’s most cross-functional and ambiguous efforts and can “plug holes” when other functions don’t exist yet. BizOps is often in charge of company planning (e.g., OKRs) and the effectiveness of other internal processes.
What influences the flavor of Ops in any given company?
There are three factors that impact what Ops is in a given company:
- company business model,
- company size, and
- idiosyncrasies related to history and experience profile of people at hand.
Operations will comprise dramatically different things depending on the company’s business model. For a marketplace, Operations will often deal with the Supply side of the market. At Uber, for example, drivers need to be recruited, taken care of, and offboarded. A separate BizOps team may take on company-wide projects, a SalesOps team will help Sales.
In a B2B SaaS startup, a Supply Ops team isn’t warranted, so Ops will have a more “corporate” flavor around BizOps, SalesOps, Analytics, and Pricing.
Company size will impact what “Ops” is: as any other function, Operations will tend to branch out into more teams as the company grows. An “Engineering” blob in a seed-stage startup grows into a complex matrix organization by series-C that may include teams like Growth, Experience, Mobile, Infrastructure, etc. Operations tends to go from “BizOps” to any number of the functions we’ve listed in the previous section.
Finally, existing and new hire profiles will materially impact how functions get cut and organized in any given company. You may find a rockstar former investment banker who’s also done BizOps in a startup and combine Strategic Finance, BizOps, and Analytics under that person. Or you may decide to give People Operations and BizOps to the same leader, like Google did a number of years ago when they hired a McKinsey partner to run both.
I’m still confused. Explain this to me with pictures?
Because a 2×2 makes everything better, here’s one that plots the various functions that may be called “Ops.” “Core functions” are shown in pink; “functions that support other functions” are in blue. Pretty much any function tackles both strategic and operational questions, so the vertical placement is approximate.
When does it make sense to hire an Ops person or team?
Assuming you have customers (whether or not you have revenue), you’ll probably be hiring some sort of customer support or customer success person/team first. It’s also likely that you’ll have an HR/PeopleOps person on your team rather early.
In terms of BizOpsy folk (which may include any combination of the blue functions in the above chart), one way to look at it is: it makes sense to hire them whenever the founders become so mired in internal company stuff that they can’t pay appropriate attention to company growth, company culture, investor relations, and hiring. This is very likely to happen by series-B and often within series-A.
In the beginning, one-two-three folks will be doing _all_ of the blue functions; over time, the functions will branch out in a way that makes sense given your business model.