Realities of Renewals: Five Keys to Business Transformation
Once an afterthought on the balance sheet, recurring revenues are gaining new respect and attention in the business world. Many companies are adopting subscription-based offerings alongside traditional sales models. Some are moving completely to a subscription model. And many sense that their existing renewals business is underperforming, leaving revenues untapped.
If your business is just starting, you can build a renewals culture from scratch using proven best practice – we publish plenty of them in this blog. But if you have an established business, you face the process of changing existing sales practices to transform renewals performance. It may be like changing direction on an ocean liner – something best done in stages.
At ServiceSource, I work with businesses of all kinds as they seek to transform their renewals performance, sometimes encountering roadblocks and challenges along the way. It’s not as simple as training people to phone (or email) and ask for renewals. The more entrenched your business practices, the more complexity you will have to manage in order to achieve your desired results. The good news is that a successful recurring revenue business plan can be distilled down to the “Five Keys to Business Transformation”:
Find the template for your business
The first step is to understand the size of the gap between where you are today and where you want to be. What vision are you hoping to achieve- what kind of recurring revenue growth, for example, or what percentage of your revenues do you want to achieve on a recurring basis? And how far are you from that today?
Starting with an honest assessment of where you are today is critical to long term success and will pay big dividends downstream by establishing a firm foundation from which to build your transformation on.
I’ll address each of the five keys in future blogs as I publish this series about the realities of building a renewals business. But as you set out, remember that no two businesses are exactly alike. Changing course may require time and effort. The larger the renewals business, the greater the potential payoff from your efforts.
In the time being, see how strong your current renewals performance is so you can better drive future results using these 12 essential key performance indicators (KPIs.)
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