Companies are moving to recurring revenue models to provide durable new streams of revenue

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17/02/20

A recent IDC Market Spotlight, sponsored by PwC, Lead-to-Cash Transformation, states that: “Nurturing a customer lead all the way to recognised revenue is a manual and complex process for most companies. The journey spans multiple departments using several business applications that must work in concert to do business efficiently. This complexity is even higher for companies that have grown by acquisition because they must merge this process with their standard operations, applications, and data. The result is a lead-to-cash process that is inefficient and patched together with spreadsheets to handle the customisations.”

There are four key takeaways from the paper:

  1. The lead-to-cash process is typically complex and manual as well as inefficient and inflexible to change.
  2. Many companies are moving to recurring revenue models to provide durable new streams of revenue.
  3. Automating the lead-to-cash process while enabling new business models is possible with technology but significantly impacts the organisation and how it operates.
  4. Companies need to create and execute a comprehensive plan that focuses on the customer and includes both organisational and technology change.

The paper has a message from PwC as the sponsor:

“The journey to straight-through lead-to-cash automation, the adoption of subscription-based revenue models and related accounting changes pose a major challenge for companies across their data, business processes, systems and internal control programs. To effectively navigate these challenges, executives must clearly define enterprise business and pricing model requirements in terms of present and future needs. This is a large transformational change. Thus, effective change management is extremely important. Transitioning to a recurring business model, for example, will affect many operational functions, change the way performance and incentives are measured, and lead to new reporting requirements. PwC's phased approach to assess, convert, embed and optimize lead-to-cash transformation is designed to help companies through these challenges. This comprehensive strategy, along with structured procedures, project-enabling tools, accelerators and vendor knowledge are designed to assist clients in this transformation journey.”

Peter Schraeder, Partner, PwC Risk Assurance said: "Revenue automation can be a significant transformational change for clients today.  Transitioning to a recurring business model, for example, will affect many accounting and operational finance functions, change the way performance and incentives are measured, and lead to new reporting requirements. PwC's phased approach to optimize lead-to-cash transformation is designed to help companies through these challenges. This comprehensive strategy, along with structured procedures, project-enabling tools, accelerators and vendor knowledge are designed to assist clients in this transformation journey."  

 

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Rob Donnelly

PwC Global Analyst Relations, New York, PwC United States

+1 (917) 471 3355

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