3 | Enabling Revenue Operations in a 21 st Century Commercial Model Copyright © Revenue Enablement Institute Complex enterprises with revenues of $500 million or more struggle to grow and adapt to market demand because they are stifle d by functional silos which lead to the fragmented management of revenue teams, the cross functional customer journey, and the ope r ations that support sales, marketing, and services. This can lead to an overly complicated commercial technology portfolio and disco nnected customer engagement data sets as well as key points of failure where revenue and margins are lost in the customer jo urney. Slow growing enterprises with limited demonstrated ability to sustain growth or capture new markets suffer from lower than average growth and valuations relative to their industry peers. The average enterprise listed on the S&P 500 grows at 3.9% and has a value of 18 times earnings before interest, taxes, and depreciation (EBITDA). 52 Even large and slow growing o rganizations in mature markets can generate more profitable growth by tightly managing their commercial processes and intelligently allocating their commercial resources to the activities, accounts, and opportunities w ith the greatest potential. “Margin ma ximizers” generate more profit at lower cost to sell by demanding that every commercial asset and resource demonstrate a financially valid return and tuning their commercial architectures to generate the most profitable sal es from limited resources. C EOs a nd CX Os that seek to grow at scale are increasingly unifying the commercial operations that support sales, marketing, and customer support to generate more scalable growth from their revenue teams. To do this, the CEOs of “Agile Enterprises” are p utting in place growth leaders with a broad span of control over all revenue teams, and a mandate to better leverage technology as a fo rce multiplier and transform the commercial model to become more data - driven, digital, and accountable. Investors and boards are p utting pressure on every business to generate more predictable and profitable growth by transitioning some or all of their offerings to a recurring revenue model by introducing cloud solutions, SaaS offerings or subscription service s. Business model transf ormation like this requires strong leadership from the top to create incentives and systems that align product, marketing, and customer success teams on generating annual recurring revenues and the high growth rates required to make the transition to a clo ud business. Businesses that successfully transform into cloud businesses are rewarded with earnings multiples in excess of f orty five times EBITDA. 54