Beyond KPIs: Self-Service Strategic Planning with Benchmarks

Beyond KPIs: Self-Service Strategic Planning with Benchmarks

Big Data used to hold so much promise, didn’t it?

In theory, massive volumes of data points to classify, categorize, study, analyze, and chart should provide Revenue Operations professionals with a plethora of insights that could be used to make better decisions for their customers and company. But so often, Big Data projects never get to the point of producing benchmarks, falling far short of delivering on these lofty goals.

Why is that?

Among the myriad of reasons for data project failures identified by tech reporting outlets and business schools, the ones that bubble to the top most often are a lack of skills, strategy, and, ironically, data.

Self-Service Reference Points on Demand

Too often, organizations don’t have the capacity to identify the questions nor build and maintain the data pipeline and reports that will create the unlocks sought from Big Data projects. In our annual SEI Report, Zuora combines our unparalleled access to historical recurring relationship data with in-depth analysis identifying the qualities of companies which lead the growth pack.

Our in-app Benchmarks Dashboard now translates this analysis into a shortcut for our customers to use Big Data to their advantage with personalized insights for key areas of the Order-to-revenue process.

 

Now, let me introduce the different types of benchmarks you’ll find embedded within Zuora.

Payment & Collections Optimization

Prompt payment collections are the lifeblood of any business, enabling companies to maintain healthy cash flow, meet financial obligations, and fuel growth initiatives. Implementing streamlined payment processing systems and incentivizing timely payments can accelerate revenue realization and minimize the risk of late payments, write-offs, or cash flow gaps. A lower score in these areas might indicate that it’s time to explore adding new payment gateways, offering incentives for early payments, and utilizing automated payment reminders and dunning processes.

Automated Billing Efficiency

This benchmark offers a glimpse into the degree to which a Zuora customer has been able to automate their billing process by comparing how many invoices are produced each time a billing process is run. A higher volume of invoices in fewer jobs is preferable because this suggests that billing specialists don’t have to spend their time with manual intervention for one-off, bespoke invoicing.

When this score is lower than desired, it could indicate there are places where a more standardized Order to Revenue process could help the business. Levers to try include restructuring or reducing product catalogs to limit the permutations of bill runs needed, providing guided options to help sellers choose standard contracts more often, and aligning bill dates to specific days.

Speed to Close Books

Timely financial reporting is essential for informed decision-making, regulatory compliance, and investor confidence. Companies with shorter closes can gain a competitive edge by accelerating financial insights into the hands of executives and enabling agile decision-making. They also tend to have happier, less stressed accounting employees who don’t have to spend their nights and weekends putting in overtime for the first 2 weeks of the month. To increase this score, it’s helpful to look for bottlenecks that can be streamlined. Often implementing an automated revenue reconciliation tool such as Zuora Revenue can speed this process along as well.

Regularly Updated Pricing Plans

It may seem counterintuitive, but in today’s dynamic market landscape, updating pricing often is a mark of an organization that is in tune with the market, the competitive landscape, and customer preferences. Additionally, companies that regularly update pricing plans to reflect market dynamics, customer feedback, and competitive benchmarks can maximize revenue realization and customer retention.

Conducting market research, analyzing customer behavior and preference towards a specific pricing or packaging model, and monitoring industry trends can inform companies where there is room for price optimization.

Blended Use of Consumption & Subscription Models

Consumption-based billing models are all the rage right now. They offer flexibility and value for businesses and customers, allowing companies to align pricing with actual usage and deliver personalized pricing plans. The drawback is that usage-only models don’t provide the revenue predictability that subscription plans do.

We’ve found the most successful companies tend to have a mix of both types, effectively building a Total Monetization strategy that proportionately leverages both categories of pricing to provide a base level of forecasting predictability without losing the opportunity to scale pricing for customers according to their actual usage of the product.

Beginning to offer flexible payment options like pay-as-you-go, prepaid with drawdown, and more can help companies cater to diverse customer needs, optimize revenue streams, and foster long-term customer relationships with customers who understand the value they are paying for.

Customer Flexibility

This metric tracks how often your customers change their relationship with your company. Companies that offer flexible subscription options, such as customizable plans, scalable features, and easy upgrade/downgrade/pause/resume options, can better meet the evolving needs of their customers and prevent churn. Frequently changing product selections is indicative of engaged customers who can scale their use according to their current needs.

To increase this score, companies can consider offering new rate plans and making it easier for their customers to self-manage products and subscriptions within a portal, checkout experience or even within a digital service interface.

Putting Benchmarks to Use

Whether your goal is to propel your company to the very top of the SEI or simply to start on a path of continuous, incremental improvements, these benchmarks are invaluable in strategy ideation. Now, they are available for Zuora customers 24/7. Scores and cohorts also update daily, so as you try out new strategies, you’ll get immediate feedback on the efficacy of your updates without waiting months for anecdotal feedback.

As a Zuora Customer, you can harness the power of over 16 years’ worth of analysis and insights from the best companies focusing on recurring relationships. Contact your CSM to start the conversation today for more guidance on leveraging the Journey to Usership benchmarks within your company.

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