Revenue Management Overview

The Business Challenge Today

Business executives and leading industry and financial analysts recognize that failure to implement effective pricing strategies, enforce deal analysis discipline, effectively manage contract sales opportunities and channel relationships, and execute timely, error-free trade incentive payments costs companies millions of dollars in revenue annually. Poor revenue management also leads to higher sales and operations costs, customer dissatisfaction due to pricing irregularities, and greater financial regulatory reporting exposure.

Revenue management is a core, strategic initiative that can have a dramatic impact on both company revenue and brand viability. Industry surveys reveal that poor revenue management practices can cost companies between $20M to $40M in lost revenues for every $1B in sales. In addition, increased financial regulatory scrutiny places growing pressure on companies to put in place improved processes and tools to control and validate pricing, contracting, and incentives in support of regulatory reporting requirements. In some industries, such as life sciences, government fines have cost businesses more than $2B in the last few years.

Unfortunately, the corporate departments typically involved in managing revenue through a complex life cycle — marketing, sales, and finance — have little visibility into or control over the downstream steps in the process. The challenge of managing revenue is that it is not often administered as an end to end process. Tasks are executed and commonly "thrown over the wall" for the next organization to deal with. Rarely are there common sources of information or tools for collaboration between groups. Even less common is the means for sharing information back with a group so that they can proactively manage revenue as a result of actual performance.

The Revenue Management Vision

Model N's vision transforms the patchwork systems companies typically use in the management of revenues by aligning the people, processes, and information companies rely upon to plan for, capture, and actualize corporate revenue. While many manufacturers have made process improvements and standalone system investments in pricing or contracts, experience working with the leading companies and industry experts revealed that critical gaps still existed in the end-to-end revenue process between pricing strategy and execution, management of contract relationships and payment of channels incentives — gaps that lead to significant exposure to revenue leakage and regulatory compliance risk.

Model N has worked with leading manufacturers and industry experts to bridge these gaps by linking together and automating the complexities of developing and executing pricing, contracts, settlements, and regulatory compliance in a system of integrated applications that manage the end-to-end revenue lifecycle. The Model N solution aligns the complex revenue management processes for all departments involved — marketing, sales and finance. The Revenue Management Suite also provides a comprehensive infrastructure for placing controls within the revenue management process and an automatic audit trail of all actions — dramatically improving the ability of companies to manage regulatory exposure.

Model N Industry Solutions

Model N provides a suite of integrated applications specifically for life sciences and high tech semiconductor companies that enables multi-departmental visibility and control over the entire revenue management life cycle. The applications are designed for the unique needs of each industry to incorporate industry best practices and functionality, and can be simply extended to include any customer-specific configurations required to capture a company's unique business processes.

Model N's Life Sciences and High Tech Revenue Management application suites utilize common technology platforms and supporting services that ensure the business processes and information can be easily and consistently shared among the various departments that share responsibilities for managing the revenue lifecycle. The solutions are designed to seamlessly integrate with and complement legacy ERP and CRM systems to complete the order-to-cash cycle and provide a comprehensive, auditable system of pricing, and contracts visibility across multiple channels.

The Model N Difference

The key difference in the Model N Revenue Management vision is the ability to link together these often disparate activities into an integrated process, from revenue planning stages to execution and attainment of maximum contract or deal value, net of all incentives to channels partners. Model N is able to deliver on this vision because of a unique approach to technology. By offering a platform with shared tools and services that enable each of the applications to function standalone, or together as an integrated suite when multiple applications are deployed, Model N technology can link people, process, and information across departmental and corporate boundaries. This comprehensive, cross-functional capability enables Model N to deliver a breakthrough in Revenue Management process improvement.

Model N has established a proven track record developing and deploying end-to-end Revenue Management solutions, with mission-critical deployments in the leading life sciences and high tech semiconductor and electronic component companies. These industry leaders have endorsed Model N's unique integrated platform approach and comprehensive suite of Revenue Management applications as the core of their strategy for reducing revenue leakage and regulatory compliance risk.

Demonstrated to address the shortcomings in first-generation piecemeal systems, Model N applications are designed with the flexibility to better adapt to today's rapidly changing business landscape. The applications imbed industry specific best practices to provide greater "out of the box" functionality, with better usability that increases adoption and an operations-friendly Internet deployment model that lowers overall cost of ownership significantly from typical client-server enterprise applications. Model N continues to make significant commitment to the life sciences and high tech semiconductor markets, both in terms of building the best-in-class domain expertise in developing and implementing Revenue Management, and in creating effective strategic alliances with the leading consulting firms and systems integrators. Model N is committed to creating long-term partnerships with its customers — enabling Revenue Management to emerge as the strategic, core business process that drives corporate success.