Addressing a long-standing industry challenge, Accenture (NYSE:ACN) and ServiceSource® (NASDAQ:SREV) have formed a global alliance to make it easier and faster for companies, such as manufacturers of computer software and equipment and medical technology devices, to generate and retain more recurring revenues from their customers. These revenue streams flow from various types of agreements such as hardware and software maintenance and support contracts, subscriptions offered by software as-a-service providers, and warranties for health and life science equipment.
These types of agreements are sold initially by the original sales teams, but then must be renewed periodically to ensure that companies continue to deliver the service and collect the revenue. For the past two decades, however, renewal processes and related data have become overly complex, disaggregated, and time-consuming to navigate. As a result, companies often have not invested the time needed to pursue these ongoing revenue opportunities with existing customers, and when they have, the results have generally been poor.
“Accenture and ServiceSource recognize the challenges associated with the recurring revenue sales process and see a big opportunity for technology companies to drive more recurring revenue — potentially $30 billion per year according to ServiceSource analysis – if they can transform this increasingly strategic piece of their business,” said Mike Smerklo, chairman and CEO of ServiceSource. “Most companies incorporate a significant recurring revenue component for much of what they sell including renewals for hardware, software, software-as-a-service and other subscription services. In fact, these renewals often account for 30-40 percent of a technology company’s revenues and as much as 50 percent of its profits.”
Working together, the two companies will combine leading technology, services and best practices to drive companies’ top-line results around existing and emerging recurring revenue streams. Accenture will deliver capabilities in systems integration, consulting, business transformation, and predictive analytics.ServiceSource will deploy Renew OnDemand™, its cloud-based application that provides the data management, sales automation and sales analytics capabilities needed to maximize recurring revenue. Together, Accenture and ServiceSource will create a comprehensive “Recurring Revenue Blueprint” to help technology companies capitalize on these opportunities, including:
- Innovative industry practices for targeting recurring revenue and renewal opportunities, data management, value selling and minimizing churn;
- Integration of existing systems and data including customer relationship management (CRM), enterprise resource planning (ERP), and billing applications;
- Sales transformation for incorporating new recurring revenue and renewal processes and practices into existing sales operations;
- Technology solutions based on ServiceSource’s Renew OnDemand, the only cloud application purpose-built to maximize recurring revenue; and,
- Selling and enablement managed services to enhance coverage and performance in recurring revenue.