Are you watching these 3 sales operation nutrients for a healthy SaaS diet plan?
Eat smaller portions more often. How many times have these “watch-your-diet” debates gone through your head while stuffing yourself with one more slice of that scrumptious pizza? More times than we’d like to admit!
Smaller portions mean more choices and greater control. Software-as-a-Service (SaaS) business models are no different. They are a smart way of delivering digital products to customers in a pay-per-use or subscription-based model. The SaaS industry has skyrocketed over the last couple of years with a predicted global revenue of 143.7 billion by 2022.
Most organizations have either already moved to SaaS or are planning to move to SaaS. And why not? It is a ‘zero-anxiety’ offering for the customers. Rapid deployment, reduced maintenance, improved flexibility,better data privacy & security,easy scaling and lower cost are some of the attractive features of this model. All the heavy lifting is done by the provider. The software updates and installations are automated without any customer intervention or any hardware-software requirement on the customer end.
Since the consumption is based on the usage metrics, it is important for the SaaS provider to be disciplined and focused on expanding their consumer base and encouraging a recurring revenue model. Running a healthy SaaS business requires a thorough look at all the key business processes. The model heavily relies on cross-selling and upselling into existing accounts and viewing business processes through a data lens with a very targeted set of metrics to keep track of growth and future decision-making. The software ticket size here is smaller as compared to that of an on-prem offering. Hence, providers have the choice of tapping into a wider market. It also gives customers, large or small, the option to add sophisticated software into their value chain.
One of the focus areas in a SaaS business model is Sales Operation Planning.
A well-rounded sales operation stands on thought-through strategies for achieving KPIs, new age technologies to drive extreme automation, real-time performance evaluation and streamlined operation management for business scaling. When businesses are nurturing the SaaS mindset, it becomes imperative for CRMs and ERPs to be able to communicate effectively; with an overlay of quality data and advanced prescriptive analytics running through key metrics to gauge consumer, partner and sales personnel’s behaviors and device dynamic action plans to reduce churn rate and improve customer experience.
It requires nothing short of a transformation to strategize and mobilize the sales unit of a business to successfully maintain its SaaS health quotient. As scary as it may sound, it is absolutely doable with careful planning around it.
Let us take a deep dive into the 3 key drivers of sales operation transformation in a SaaS model, to understand, how realigning our focus could be a game-changer.
Smart Configure Price Quote (CPQ)
Product offerings and discounts in a SaaS business model are bundled to suit customer needs. Continuous analysis of micro trends of customer purchase behavior gives actionable insights for businesses to quickly adjust their offering packages as per the changing demands. CPQ is a software used by sales teams to produce highly precise, quick and configured quotes, pricing for all complex products with a centralized access. Making your CPQ process intelligent will ensure accurate and consistent pricing for a streamlined sales process. The following are the process hotspots that must be automated for your CPQ to work to like a well-oiled machine:
· Customer and Product Information Management
· Product Configuration and Rules
· Pricing and Discounting
· Quote Creation and Management
· Credit Check and Export Compliance
Intelligent CPQ will help you maximize sales with smart quotes by analyzing deal profitability, contract negotiation, increased accuracy and shorter sales cycle.
Augmented Order-to-Cash (OTC)
OTC is a set of business processes that involve receiving and fulfilling of customer requests for products and services. The subscription plans for a SaaS-based product are usually monthly, quarterly or biannually. Building payment plans, which, respond to customer needs, will encourage higher frequency and larger volume of renewals rates. An automated, integrated and data augmented OTC process is a must for the process to touch every channel, every department and every customer. The hotspots for improvement here are:
· Contracts and Subscription Management
· Usage Data Capture
· Service Charge Rating and Mediation
· Billing management
This data augmentation will enable faster sales cycle, order accuracy, evaluate deal risks, reduce churn rates with a monitored contract management, positively impacting the revenue model.
Return-based Sales Incentive Planning
Sales compensation is slightly complex in a SaaS-based model. Unlike traditional software companies, the work of a sales personnel does not end when a new customer signs a contract. It is crucial to retain and expand customer base over longer duration. It is necessary to align the sales behavior with business objectives. With new monthly recurring revenue (MRR) and annual recurring revenue (ARR) models in place, it is important to reduce customer churn rates. Sales thrives on competition. A return-based sales compensation plan for partners and sales agents needs to be implemented keeping in mind the long-term customer engagement plan.
The Bottom-line: Embracing the SaaS-route is a mindset. Business goals, KPIs, people, processes, systems; all must undergo transformation in this model. Without purpose and direction, one would be stuck in dealing with process lags, unforeseen loss of deals and quick churn rates. Other than sales, finance, customer engagement policies and product bundling must be tightly coupled to yield faster, continuous and positive outcomes. We are excited about how SaaS presents numerous growing opportunities for businesses. Enquero continues to help businesses achieve their end-to-end healthy SaaS business model by evaluating change assessment on data, policy and systems, updating business goals and KPIs, identifying key gap drivers and strategizing to implement tech roadmaps to smoothen out the operational kinks.
