Tech Stack Consolidation

What is Tech Stack Consolidation?

Tech stack consolidation is the process of simplifying an organization’s technology infrastructure by reducing the number of software tools and platforms in use. It involves identifying and eliminating redundant or overlapping technologies, integrating essential tools, and often moving towards a more centralized or unified system.

The main objectives of tech stack consolidation include:

• Reducing technology costs by eliminating redundant tools
• Improving operational efficiency by reducing complexity and promoting standardization
• Break down information silos caused by poorly integrated technology
• Bolster security by making it easier to monitor and protect the organization’s data
• Create a more intuitive and less fragmented user experience

Consolidation entails creating a strategic plan that outlines which tools will be eliminated, which will be integrated, and how the transition will be managed. To effectively consolidate a tech stack, businesses have to choose tools that are multifunctional, scalable, and offer seamless integration with existing systems.

Synonyms

• Tech stack optimization
• Software rationalization
• Platform consolidation

Tech Stack Challenges

While technology is designed to make our lives easier, managing too many disparate tools and platforms can actually create inefficiencies in your workflow. When this happens, you get “tech stack sprawl” — a term used to describe the uncontrolled growth of technology within an organization.

One of the primary consequences of a bloated tech stack is the financial burden it places on the organization. With numerous overlapping tools, the costs of software licenses, maintenance, and support can escalate rapidly. This financial strain is compounded by the hidden costs of training employees on multiple systems and managing various vendor relationships.

Beyond this, an unmanaged tech stack comes with serious problems:

• Shadow IT — This occurs when employees use software without the approval or knowledge of the IT department. It sometimes causes significant security and compliance issues, as well as redundant expenditures on software licenses.
• Vendor management complexity — Managing relationships with multiple vendors can be overwhelming and time-consuming. It increases administrative overhead and complicates the coordination needed for troubleshooting and support.
• Integration issues — As different tools may not seamlessly integrate with each other, data synchronization becomes a challenge. This leads to inconsistent data across platforms, making it impossible to operate with a single source of truth.
• Employee productivity limitations — When team members have to work with multiple interfaces (and, often, manually transfer data) on a daily basis, the amount of time it takes for basic tasks (e.g., product configuration and the quoting process) is significantly higher.
• Security vulnerabilities — From a security perspective, multiple logins and data storage points translate to more opportunities for cybercriminals to attack an organization, or for sensitive information to fall into the wrong hands — internally or externally.

You can fix all of these issues by optimizing your tech stack for (a) limited vendors, (b) well-integrated software tools, and (c) standardized processes.

Importance of Tech Stack Consolidation

The #1 reason to consolidate your tech stack is to cut costs. By leveraging the same tool for multiple functions, you reduce subscription fees and dependence on multiple different vendors. At the same time, you can eliminate redundant software, reduce your IT burden, and allocate resources more strategically.

In addition to this significant bottom-line benefit, there are several other reasons that businesses are increasingly prioritizing tech stack consolidation:

• Better management of data and insights. Consolidating your tech stack allows you to unify customer data and insights. As a result, businesses get a more comprehensive view of their customers, resulting in better segmentation, targeting, and personalized marketing.
• Stronger security posture. Organizations that use numerous tools to fulfill different functions face a higher risk of data breaches. With fewer tools to monitor and secure, businesses can more easily implement stricter security protocols.
• Improved user experience. Consolidation reduces the clutter and complication that comes with managing multiple tools. As a result, it becomes easier for employees to navigate through various systems and processes, improving overall productivity.
• Future-proofing your stack. By consolidating now, organizations are better prepared to handle future technology changes or disruptions. With a simplified tech stack, it is much easier to add new tools or replace outdated ones as needed.
• Better team efficiency and collaboration. With a consolidated tech stack, employees can work more seamlessly across different teams and projects. Processes are streamlined, and everyone can work in the same UI with access to the same data.

Not to mention, the data you’ll have will be much more accurate. With all your systems connected, it’s much easier to make accurate financial projections, communicate sales performance with stakeholders, and understand how different sales, marketing, and customer success tactics contribute to your bottom line.

How to Consolidate Your Tech Stack

While the exact actions you take in each step will depend on your current software infrastructure and what you need to optimize for, there are specific steps you have to follow to successfully consolidate your tech stack.

1. Audit your current tech stack.

Start by conducting a comprehensive audit of all the tools and software currently in use across your organization. Gather data on each tool’s usage, cost, integration capabilities, and user satisfaction.

From there, map out which members of your team use each tool, and what for. Look for overlapping functionalities among tools. And, if multiple tools serve the same purpose, evaluate if all are necessary.

Your final step here is to assess how well each tool integrates with others in your stack. On your map, show how it connects with others in your end-to-end workflow.

For example, if you’re evaluating your sales workflow, you might start with a CRM for customer data. But the next step in the sales process involves configuring a product, calculating a price, and developing a quote or proposal. So, you’d want to check how well your CRM translates customer data to your CPQ.

As you move through these processes, make note of redundancies (two tools performing the same function), integration problems, and what tools may be missing from your tech stack.

2. Categorize tools based on their functionality.

Next, group tools into categories — e.g., sales, marketing, customer service, and finance — based on their primary functions.

Within each category, identify tools that perform similar tasks. This will help in pinpointing redundancies and opportunities for consolidation. For tools like CRM that are critical for multiple functions, include them in each relevant category.

3. Assess the value of each tool.

It’s quite difficult to assess the ROI of a specific tool because of how many variables are at play. However, you can get a general sense of each tool’s value by looking at its use cases and features.

Evaluate the following factors for each tool in your stack:

• Productivity impact
• User satisfaction
• Cost vs. alternatives
• Alignment with current and future business objectives

Depending on the number of tools your organization uses, you might use a scoring system to rate each tool’s importance in your tech stack based on these factors.

4. Develop a consolidation plan.

Once you have everything in order as far as what you need to change and what you don’t, it’s time to develop a plan of action for consolidating your tech stack.

Start by rationalizing non-essential tools. Decide whether to eliminate them, integrate point solutions into a comprehensive platform, or invest in multifunctional tools that cover multiple needs.

In general, the larger your business, the more you’ll benefit from a comprehensive solution. You might be able to get away with multiple single-purpose tools as a small company. But that’s very challenging to maintain as you scale because of the lack of structure.

If you are planning on replacing multiple tools with a single platform, focus on tools that offer seamless integration to minimize data silos and improve efficiency.

Finally, develop a timeline and assign responsibilities for the consolidation and data migration processes, ensuring minimal disruption to business operations.

5. Get feedback from stakeholders.

You have to involve team members and other stakeholders in the decision-making process to ensure the selected tools meet their needs.

Your stakeholders should include:

• End-users
• Team leaders and managers
• IT support and other technical staff

Ask them to provide feedback on the current tech stack, including any pain points they experience. Share your consolidation plan with them and get their input. And adjust your consolidation plan based on the feedback received to ensure buy-in and smooth adoption

If you’re looking at replacing something, have users test potential replacement tools and gather feedback on their effectiveness and user experience. Also test them at different usage levels to evaluate their scalability.

6. Implement the consolidation

Before executing your consolidation plan, inform all stakeholders about the changes, timelines, and benefits of the new consolidated stack. Then, eliminate non-essential tools, migrate data and workflows to the new tools, and train team members on how to use them. For large-scale implementations, work with your vendor to ensure a smooth transition.

It’s also essential to have a phased implementation approach for the consolidation process, starting with non-critical tools and moving towards more critical ones. This minimizes disruption and allows for adjustments along the way.

7. Maintain and optimize your tech stack.

You need to periodically review and optimize your tech stack to ensure it continues to meet your business needs.

Look out for:

• New redundancies or opportunities for further consolidation
• Tools and technologies that could offer better integration or improved functionality
• Continuous improvements based on user feedback and changing business requirements

Regularly reviewing and optimizing your tech stack will help streamline your operations, reduce costs, and keep you up to date with the latest technology trends. It’s an ongoing process that should be integrated into your organization’s technology strategy. 

RevOps Tech Stack Essentials

Revenue operations (RevOps) is the strategic blending of sales, marketing, and customer success operations to drive revenue growth. Businesses are largely switching to RevOps from the traditional sales approach because it provides a more holistic and seamless experience for customers, increases efficiency, and improves ROI.

A robust RevOps tech stack is essential for aligning processes, data, and tools across these departments.

Here are some key areas within the RevOps tech stack that should be focal points of consolidation:

CRM (Customer Relationship Management)

CRM software is at the core of all revenue operations. It’s the house of all your customer data and serves as a central hub for managing the entire customer lifecycle.

Your sales team uses it to track deal progress in the pipeline. Marketing uses it for leads and campaigns. Customer success uses it to monitor retention and identify upsell opportunities.

Your CRM should integrate with:

• Marketing automation tools
• Sales engagement platforms
• Customer success software

Consolidating your CRM with other tools like digital contract management software and e-signature solutions can streamline your entire sales process, from lead to close. This approach provides complete visibility into the customer journey, eliminates data silos, and enhances collaboration across teams.

It should also integrate with any data analytics platforms you use to report on revenue, sales performance, or customer health.

CPQ (Configure, Price, Quote)

CPQ (configure, price, quote) software is a core component of sales tech stacks that automates the entire quoting process and ensures accurate, timely, and professional proposals. It allows sales reps to configure products and services, calculate pricing, and generate quotes in minutes.

Integrating technology into the quote-to-revenue process eliminates manual errors and shortens the sales cycle. As a result, it can significantly improve customer satisfaction rates and win rates.

While it should integrate with your CRM software (and ERP if you’re a B2B manufacturer), the best solution is to take an integrated approach with other tools in the quote-to-cash process. This simplifies your entire workflow and streamlines the handoff between your sales and finance departments.

For example, DealHub’s revenue amplification platform includes CPQ for quoting, a digital sales room (DealRoom) for sales conversations, e-signature and contract management for closing deals, and billing for collections.

Sales Enablement

Another core component of any sales stack is sales enablement technology. These tools provide sales reps with the resources, training, and support needed to effectively engage with buyers throughout the entire sales cycle.

Sales enablement tools include content management, e-learning, sales coaching, sales playbooks, and sales call recording/analysis software.

A lot of sales enablement tools perform individual functions, like content management or sales coaching. However, you can consolidate by looking for CPQ that offers sales playbooks and guided selling, sales engagement platforms that include content and coaching, or a digital sales room that facilitates customer conversations and file sharing in one integrated solution.

Marketing Automation

Marketing automation tools come in all shapes in sizes. Their core function is to automate manual marketing tasks, like email campaigns, social media, and lead nurturing. They also track user behavior and provide insights for segmentation, personalization, and campaign optimization.

Examples of consolidated marketing automation solutions include:

• HubSpot, which has a CRM and marketing automation platform
• Marketo for email campaigns, lead nurturing, and social media
• Pardot for B2B marketing automation
• Mailchimp for email marketing automation

You want to use larger platforms like these because it makes revenue attribution a lot easier, especially if the customer journey has dozens of touchpoints across different channels.

Integrating your CRM with a marketing automation tool can help you better align sales and marketing efforts, allowing for more targeted and coordinated campaigns. In some cases, like HubSpot, you can consolidate your CRM and marketing automation platform into one tool.

Business Intelligence

Business intelligence (BI) tools like Power BI and Tableau help businesses make data-driven decisions by analyzing large sets of data. You can use them to monitor sales performance, track customer behavior, identify trends and patterns, and make projections for future growth.

While your CRM may have some built-in reporting capabilities, integrating it with a BI tool can help you take a deeper dive into your data and gain more insights. This can be especially useful for revenue operations, as it allows for better tracking of revenue metrics and cross-departmental data analysis.

If you use a consolidated sales platform, it’s easy to integrate with a revenue intelligence platform to get an accurate view of your pipeline. For instance, DealHub integrates with Gong to provide sales teams with real-time insights into buyer intent, deal sentiment, and pipeline risk.

Billing Software

Billing software connects your sales workflow to finance operations. It streamlines the billing process and allows for easy invoice generation, payment tracking, and, for businesses with recurring revenue, subscription management. 

Integrating your CRM with a billing software can help you stay on top of overdue payments, renewals, and other critical financial metrics.

Some popular billing tools include: 

• QuickBooks for small businesses
• Stripe for online payments
• DealHub for subscription billing and management

Integrating your CRM with billing software can help you stay on top of overdue payments, renewals, and other critical financial metrics. And using a consolidated sales platform (like DealHub) or financial management platform (that integrates billing and accounting) can help you streamline your workflow and eliminate manual data entry.

Benefits of a Consolidated RevOps Tech Stack

Integrating all of your sales, marketing, and finance tools with your CRM can bring numerous benefits to your business.

Some of the key advantages include:

• Shorter sales cycles with better lead nurturing and pipeline tracking
• Greater alignment between sales, marketing, and finance teams
• Improved data accuracy for forecasting and decision-making
• More personalized customer experiences
• Better marketing targeting and campaign management
• Proactive churn management for customer success teams
• Faster collections times with fewer instances of revenue leakage

In other words, investing in RevOps tech stack consolidation results in overall higher efficiency and productivity across the whole company.

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