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PS in the Cloud © Begun Consulting 2009, 2010
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Study Process
• Best practices interviews– 10 companies– CEO or VP/Director of PS or Services– Mix of sizes, software types, and maturity
levels
• Follow-up written survey
PS in the Cloud © Begun Consulting 2009, 2010
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SELECTED DATA -- PARTICIPATING COMPANIES
Highest Lowest Average(wIthout outliers)
Person time to implement (average, in hours) 4500 3 500Elapsed time to implement (average, in days) 100 30 80Average annual subscription revenue per cust ($1000) 1500 8 225Initial services revenue per cust ($1000) 350 2 180Initial services revenue / annual subscription revenue 75% 25% 50%Consultant billing rate $250 $90 $145% implementations that are fixed price 100% 2% 80%
Annual Revenue ($million) 900 30 300Customers 4000 15 1100Years operating under SaaS model 12 1 7Product complexity rating (1-10, 10 = most complex) 10 1 5.5
PS in the Cloud © Begun Consulting 2009, 2010
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Client Services Themes
• Very broad range of delivery effort– Delivery effort/time varies considerably– Different models (within vendor) for different
customer bases and/or product configurations– Goal is to minimize implementation time, both
person (especially vendor) and elapsed • Self service is not necessarily seen as goal
• Customer expectation setting is a key factor that impacts most important metrics
PS in the Cloud © Begun Consulting 2009, 2010
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Client Services Themes (cont)
• Continual customer satisfaction and success are critical– Key to retention and increased adoption/usage– Not just a services responsibility
• Must be a pervasive company value and strategy, not an afterthought or band-aid
• DNA matters, both vendor’s and customer’s
PS in the Cloud © Begun Consulting 2009, 2010
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Services Effort Dependencies• Complexity of problem that software solves
– Complexity dimensions (both quantity and complexity within dimensions matter)
• Transaction processing• Workflow• Data integration• Analytics• Features / functions• Rules
• Customer expectations, motivation, cooperation, and capabilities
PS in the Cloud © Begun Consulting 2009, 2010
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Services Effort Dependencies (cont)
• Product maturity and x-abilities– Broad and easy configurability is the key
• Tailored services models and phasing• Services infrastructure maturity
– Methodology and process– Tools (e.g., templates) and systems – Project discipline & customer management– Staff skillsets
As companies mature, these improve
PS in the Cloud © Begun Consulting 2009, 2010
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Factors Impacting Customer Sat & Increased Subscription
Revenue
• Product features/functions
• Customer expectation setting in pre-sales
• Active post-sales management
• More/better self-service capabilities
• More/better training/education
PS in the Cloud © Begun Consulting 2009, 2010
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Services Metrics
• Customer retention, satisfaction, usage
• Person hours to implement
• Services margin
• Days to-live
• Initial services revenue - as % of ARR
• Support case close time, initial response time, and cases per support person
PS in the Cloud © Begun Consulting 2009, 2010
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PS Best Practices in the Cloud-
Other Significant Findings
PS in the Cloud © Begun Consulting 2009, 2010
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Pre-Sales
• PS involvement if non-standard and/or complex– Otherwise sell implementation packages– Tools help standardize and contain scope
• Focus on customer approach and attitude as well as feature/function needs
• Expectation setting is critical
PS in the Cloud © Begun Consulting 2009, 2010
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Activation / Implementation
• Vendor effort from 3 hours to mid 1000s– Multiple models, 100% self-service at low end
• Minimize data integration work
• Tools are important - templates, task lists, configurators, pre-configured systems
• Process - phasing, discipline, assurance
• Consultants - less technical, remote
PS in the Cloud © Begun Consulting 2009, 2010
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Training• Pervasive, all types of media, role-based
• Becomes critical when implementation is significantly self-service
• Typically included in subscription fee
• Low touch for orientation and in-context; low/no touch at low end; higher touch is part of implementation
• Training and documentation coordinated
PS in the Cloud © Begun Consulting 2009, 2010
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Technical Support
• Self service is key to leverage– Knowledgebases– How ‘to’s
• Traditional organizational structure, case management, and metrics– Web emphasis as media– Segment cases - ops, how to, product
• Career path of engineers to implementation
PS in the Cloud © Begun Consulting 2009, 2010
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Post Sales Support & Add-ons
• Approach ranges from opportunistic to aggressive
• Premium tech support
• Follow-on training
• Additional implementation, optimization
• Add-ons -- report writing, admin, reviews
• Delivered ad hoc (T&M or fixed) or via TAM (mainly for larger customers)
PS in the Cloud © Begun Consulting 2009, 2010
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Partners (Implementation)
• In general not as prevalent as in traditional software companies
• Used more for complex applications and when company mature
• Some use at low end, ‘solution center’
• Some do not use at all and point to as success criteria
PS in the Cloud © Begun Consulting 2009, 2010
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PS Best Practices in the Cloud -
Key Survey Results
PS in the Cloud © Begun Consulting 2009, 2010
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Greatest impact on DECREASING VENDOR PERSON-TIME for initial activation / implementation
Customer expectation setting in sales cycle
Product configurability improvements
Customer self-service capabilities
Greatest impact on DECREASING ELAPSED TIME for initial activation / implementation
Configuration tools
Product configurability improvements
Customer expectation setting in sales cycle
Product feature/function enhancements
Customer expectation setting in sales cycle
Active post-sales relationship management
Greatest impact on INCREASING CUSTOMER SATISFACTION
PS in the Cloud © Begun Consulting 2009, 2010
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Active post-sales relationship management
Product feature/function enhancements
Greatest impact on INCREASING SUBSCRIPTION REVENUE
MOST DIFFICULT TO IMPLEMENT
Customer expectation setting in sales cycle
Customer self-service implementation capabilities
Technical support self-service improvements
MOST POSITIVE OVERALL IMPACT ON BUSINESS
Customer expectation setting in sales cycle
More and better self service implementation capabilities
PS in the Cloud © Begun Consulting 2009, 2010
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MOST IMPORTANT COMPANY METRICS
Profit
Customer satisfaction
Customer retention
Revenue
Customer retention
Person time for initial implementation
Customer satisfaction
MOST IMPORTANT SERVICES METRICS
Regular customer reviews
Premium level support
Ongoing retained consultant (e.g., technical account manager, dedicated analyst)
PREVALANCE OF ADD-ON SERVICES
PS in the Cloud © Begun Consulting 2009, 2010
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If you have any comments or questions, or would like to discuss aspects of the study in more detail, please contact:
Alvin BegunBegun Consulting
[email protected](650) 533-4950