A Chief Revenue Officer vs A VP of Sales: Which Leader Owns Growth?

Who owns net revenue retention, who owns new ARR, and who sets the handoffs between marketing, sales, and success? A Chief Revenue Officer or a VP of Sales? Titles can blur, accountability can’t.

The CRO orchestrates demand, conversion, and expansion; the VP of Sales runs quota, methodology, and coaching. So, which role should you hire for to scale your startup?

Is the understanding of a Chief Revenue Officer vs a VP of Sales enough? Or do both roles work side-by-side?

In short, if you need tighter sales execution, hire a VP of Sales. On the other hand, if you need one owner for pipeline, bookings, retention, and pricing, hire a CRO.

Sales reps only spend about 30% of their week selling. So, a bad executive hire with poor decision-making intent can have a significant impact quickly. In this blog, we’ll compare their responsibilities, core KPIs, and a quick table that you can use in your next hiring brief.

Key Takeaways

• The CRO oversees all revenue functions, sales, marketing, and CS, while the VP of Sales focuses solely on sales.
• CROs drive multi-quarter strategies for long-term growth, while VPs of Sales focus on short-term sales targets and immediate execution.
• Hire a VP of Sales for immediate sales execution and process optimization. Bring in a CRO when aligning sales, marketing, and CS across departments for sustained growth.
• Since only 30% of the time of weekly selling is the reality, a bad executive hire will bring more challenges.
• CROs focus on metrics like LTV and channel ROI, while VPs of Sales track win rates, sales cycle, and quota attainment.

What Happens When You Hire the Wrong Leader for Your Business?

When scaling a business, hiring the right leader can rewrite your business's net worth. Fortunately, a Chief Revenue Officer (CRO) and a VP of Sales may both drive revenue. However, they each bring a different set of tools and focus areas to the table.

The challenge is understanding which one aligns best with your company’s growth stage and goals.

Here’s Why the Right Choice Matters:

• Impact on Alignment and Execution: A CRO looks at the big picture, aligning all revenue-generating functions (sales, marketing, customer success (CS)) to optimize the entire customer journey. A VP of Sales, on the other hand, focuses intensely on optimizing the sales process and ensuring your team hits quotas.
  A misaligned leadership hire can create silos or gaps in the funnel, slowing growth.
• Growth Stage and Complexity: Early-stage companies often require a VP of Sales primarily to drive growth. As your company scales, a CRO becomes essential. Hiring otherwise will create a stalled pipeline.
• Cross-Functional Coordination: A VP of Sales focuses on optimizing the sales cycle from lead generation to deal closure. However, when your company needs to unify sales efforts with marketing and customer success, a CRO brings that cross-functional collaboration into play.

That's why any lack of this coordination could lead to lost opportunities, churn, and gaps in your customer journey. Knowing the difference ahead of time equips you to make the right decision, scaling faster and with fewer roadblocks.

Also Read: 7 horrible mistakes you are making with hiring

A Glance at the Table of A Chief Revenue Officer vs a VP of Sales

The CRO has a much broader scope, overseeing all revenue streams across the organization. This includes managing the entire customer journey from initial awareness through to retention and expansion.

In contrast, the VP of Sales manages the sales team and is responsible for optimizing the sales process. While they may collaborate with marketing and customer success, their primary responsibility is to manage and grow the sales organization.

Before understanding the nuances, use this high-level framework to diagnose which role aligns with your current strategy. This is about scope, focus, and fixing the right problem at the right time.

You’ve seen the table, but here’s the real question: How do you know if your sales leadership is actually setting your company up for sustainable growth? As a CEO, you need to decide which leader can solve your biggest problems.

Is your sales pipeline healthy but stuck at conversion? Or is your marketing struggling to align with sales, or are customer success and renewals lagging behind? Let's understand this in detail below.

Ready to scale with the right leadership? Hiring VPs of Sales from Activated Scale's Fractional Sales Leadership service can help you craft the right go-to-market strategy.

1. Scope

A Chief Revenue Officer (CRO) is responsible for the entire revenue ecosystem. So, they are focused on creating a customer journey from awareness to retention, and everything in between.

The Vice President of Sales (VP of Sales)'s primary mission is to build, coach, and scale a sales team that hits ambitious revenue targets..

2. Goal

CRO's goal is to drive sustainable growth. They do it by aligning departments, setting overarching revenue targets, and ensuring the customer lifecycle is optimized for long-term profitability.

The VP of Sales is deeply involved in sales strategy, from pipeline management to closing deals. It ensures that the sales organization is executing with precision and meeting short-term revenue goals.

Let our Fractional Sales Leadership service equip you with the right sales leader to scale your revenue operations. With Activated Scale, a cross-functional approach is possible.

3. Levers

The CRO manages the lifecycle of the customer journey. Additionally, the CRO plays a key role in setting pricing and packaging strategies, making sure that the company’s offerings are aligned with market demand.

They also manage the channels through which revenue is generated and work closely with marketing and sales to drive customer retention and expansion. This is crucial as a 5% increase in retention rates could potentially boost profits by 25% to 95%.

The VP of Sales works primarily within the sales department. They use levers such as coaching cadence, pipeline hygiene, and territory and compensation design to ensure the sales team meets their targets.

4. Budget Control

One of the key distinctions between the two roles is the CRO’s ability to reallocate budgets across various customer-facing functions. They have the authority to move resources between sales, marketing, and customer success based on strategic priorities.

This gives the CRO the flexibility to optimize revenue generation by investing in the areas of the business that will yield the highest returns.

The VP of Sales, on the other hand, has authority within the sales function but doesn’t control the budgets for other departments like marketing or customer success. Their power is confined to managing the sales team’s resources, compensation plans, and sales-related investments.

5. Time Horizon

The CRO is responsible for multi-quarter growth strategies. This means they set long-term revenue goals and plan for the next several quarters or even years. The CRO helps the organization scale by building sustainable growth across all functions.

The VP of Sales, on the other hand, focuses on quarter-by-quarter delivery. Their primary responsibility is to ensure that the sales team meets immediate sales targets on monthly or quarterly quotas. While they may contribute to long-term strategy, their focus is on hitting immediate goals and maintaining a steady pipeline.

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6. Reporting Lines by Stage

Early Stage: VP of Sales → CEO. The VP of Sales is focused on building and executing the sales strategy, optimizing the sales process, and hiring the right team. They may take on some CRO duties, but mainly drive sales execution.

Scaling: Add CRO to unify marketing, sales, CS, and RevOps under a cohesive revenue strategy. The VP of Sales now reports to the CRO.

Mature Stage: CRO owns end-to-end revenue, driving overall strategy and cross-functional alignment. The VP of Sales runs the sales team with a strong management layer, focusing on optimizing processes and performance.

7. Core KPIs

Each role owns a different set of KPIs, aligned with its scope and mandate. Understanding these KPIs can help you identify the right fit for your organization’s current growth stage and objectives.

CRO KPIs

• CAC Payback: The time it takes to recoup the cost of acquiring a customer. A faster payback indicates efficient revenue generation and marketing spend.
• LTV: CAC Ratio: Measures the lifetime value of a customer relative to the cost of acquiring them. This helps determine the sustainability of revenue growth.
• Gross Revenue Retention (GRR) / Net Revenue Retention (NRR): Measures how much revenue is retained from existing customers, factoring in churn, expansion, and upsells.
• Stage Conversion (MQL→SQL→Closed Won): Tracks how effectively marketing and sales teams are converting leads at each stage of the funnel.
• Activation Time and Expansion Mix: Time taken to convert leads into paying customers and the mix of upsell/cross-sell revenue as part of overall growth.
• Channel ROI: Measures the effectiveness of different revenue channels, helping the CRO optimize where to allocate resources for maximum return.

VP of Sales KPIs

• Win Rate: The percentage of deals closed relative to the number of opportunities. A key indicator of sales effectiveness.
• Sales Cycle: The time it takes to move a deal from first contact to closing. Shorter sales cycles usually indicate a well-oiled sales process.
• Average Sales Price (ASP): The average value of each sale. A higher ASP indicates that sales teams are successfully closing larger deals.
• Quota Attainment: Tracks how well the sales team meets set quotas. This KPI is a direct reflection of the team’s performance.
• Forecast Accuracy: Measures how closely sales forecasts align with actual sales outcomes. Inaccurate forecasts can lead to resource misallocation.
• Pipeline Coverage by Segment/Rep: Indicates whether the sales pipeline has enough deals at each stage to meet future revenue goals. A healthy pipeline ensures consistent sales performance.
• Rep Productivity: Measures the output of each sales rep. Higher productivity leads to more closed deals and greater revenue.

8. Decision Checklist: Which Role to Hire

Deciding between a CRO and a VP of Sales isn’t always clear. The role you hire depends on the state of your sales process, the scale of your business, and the challenges you're facing. Let’s break it down:

Pick a VP of Sales if:

• Pipeline exists, but win rate and late-stage progression are shaky: If your company has leads flowing in but struggles to convert them into revenue or maintain sales momentum, a VP of Sales is essential. They focus on tightening the sales funnel and ensuring leads progress through the pipeline efficiently.
• Forecast is noisy, and coaching and methodology are thin: If your sales team lacks structure, process, or guidance, it’s time to bring in a VP of Sales. Since only 35% of sales professionals trust the accuracy of their organization’s data, a VP of Sales will work on improving it.
• You need territories, compensation plans, a manager bench, and a durable playbook: A VP of Sales can design territories and compensation models to motivate salespeople. They’ll also build out a sales playbook that guides reps on how to convert leads to customers.

Pick a CRO if:

• Marketing, Sales, and CS operate as silos; handoffs leak: If each department is working in isolation and not collaborating to drive revenue, it’s a sign you need a CRO.
• Ads promise one thing, sales pitches another, onboarding delivers a third: Misalignment across departments can confuse customers and cause churn. A CRO will bring all these teams under one umbrella and ensure consistency in messaging and offers.
• Churn or NRR (Net Revenue Retention) is stuck; expansion is ad-hoc. If you are struggling with churn or not effectively growing existing customer relationships, a CRO is essential. They optimize cross-sell/upsell opportunities and drive expansion revenue.
• One leader must move budgets across teams and set lifecycle targets: If you need someone who can prioritize resources effectively and track lifecycle KPIs from top to bottom of the funnel, a CRO is the key hire.

Activated Scale provides Contract-to-Hire Sales Recruiting service that fits your company’s needs. In this way, you can decide and test which leadership role works for you without hiring them full-time.

Wrapping Up

So, the question is no longer: A Chief Revenue Officer vs a VP of Sales. It's about aligning your leadership to match the growth phase of your business. If you're focused on optimizing your sales team or unifying cross-functional efforts for sustainable revenue growth, the right leadership can make all the difference.

Understanding the scope, horizon, and objectives of each role ensures you’re investing in the right leader at the right time. If you're at a crossroads and need guidance on the right leadership strategy for your sales engine, it's time for a fresh perspective.

Book a demo with us today and see how Activated Scale can help you with your business sales needs.

FAQs

1. Can a VP of Sales transition into a CRO role later on?

Yes, but only if they have experience in cross-functional leadership beyond sales. This includes marketing, customer success, and revenue operations. A CRO requires a broader skill set than a VP of Sales.

2. What’s the first sign that you need a CRO?

If your marketing, sales, and customer success teams are working in silos and not aligned under a unified revenue strategy, it’s time to consider a CRO.

3. Can a VP of Sales handle customer success?

Typically, no. A VP of Sales focuses on driving sales outcomes. On the other hand, customer success requires a different set of strategic priorities aimed at retention and long-term client relationships.

4. When should a company switch from a VP of Sales to a CRO?

When your company scales, you need more than just a sales leader. You need someone who can unify sales, marketing, and customer success under one revenue-focused strategy for growth.