Forrester Report on CLM 2014: Revitas’s Revenue Management offering emerges into commercial market
On Sept 26, Forrester published its much-anticipated Market Overview, reporting on the contract lifecycle management (CLM) vendor landscape in 2014. A notable trend pointed out in the report by Analyst Andrew Bartels, is the healthy growth in the market which indicates strong recognition by end-user customers of the need to modernize and automate their contracts processes. Perhaps more importantly, however, is the recognition that CLM exists in most organizations as a piece of a larger sell-side or buy-side business operation. Solutions that offer a more comprehensive approach to support the entire business process – either organically or through integration with partner solutions – will be able to offer better value for adopting organizations.
Revitas cited as “one of the first vendors” with integration to revenue management
Bartels points out that revenue management, with its capabilities to automate and manage complex sales channel challenges, is tied into sell-side CLM. He further amplifies, that revenue management manages the execution of the “rebates, discounts, and other incentives owed to channel partners” which are tied back to NDAs, partner agreements, and amendments. Bartels further reports that Revitas is “expanding from pharmaceuticals and medical equipment into commercial industries such as high-tech and industrial manufacturing.”
How Revitas views the full campaign-to-cash lifecycle
To put the relationship between revenue management and CLM into context, Revitas uses the following illustration of the “campaign-to-cash” lifecycle:
As shown in the illustration, the process begins with the demand generation process, often called a campaign or a program, with the purpose of creating a good lead for the sales channel. Tools which are used to manage and track the resulting leads are CRM applications.
When a lead is developed into an opportunity, then the sales channel must create a quote to the prospect showing the configuration of the product along with the price to purchase. Sometimes, this process is automated and supported with tools known as Configure/Price/Quote, or CPQ tools.
Once the product configuration and price are agreed, then the terms and conditions of the sale are captured in a contract. Multi-level contracts include Master Contract Agreements, supported by Amendments which show additions of new sales. Related NDAs are created early in the sales process, and must also be tracked for the business organizations involved.
When the product is sold through a channel, there are additional contracts which must be managed and administered – and these are the partner agreements, incentive program amendments, and additional NDAs. Also, there is the need to ensure rapid and accurate payout to channel partners with integration to financial systems.
Revenue management is focused, in this case, on automating the business processes associated with selling products or services through a multi-level, complex channel. This includes defining, administering, and evaluating or analyzing incentive programs which are designed to encourage distributors and reseller partners to sell with better productivity for the product manufacturer. The benefits of automating these processes are not only to help reduce the cost of administration and ensure valid and accurate payouts on incentives, but it also helps the manufacturer to optimize its incentive program investment.
The implications of this are to accelerate revenue, better align partners to strategic products and markets, and overall raise revenue contribution levels. In short, a sell-side CLM solution is incomplete without robust capabilities for revenue management when a multi-level, complex channel model supports your go-to-market.