Recently, Model N commissioned a research study to identify the key trends impacting revenue management today. Of the executives surveyed, 82% say that revenue management has become more difficult in recent years. It’s not enough to effectively manage the growing complexity of product availability, channels, geographies, rebates, and contracts; they also need to maintain increasingly stringent compliance requirements and strength customer relations. And this is case for all companies, regardless of their industry.
Fortunately, while they face an ongoing struggle, these executives also know that steps can be taken to streamline processes and increase margins. Virtually all (99%) of the executives can identify places where improvements can be made. Our 2020 State of Revenue Report details the challenges that cause the most angst for executives in the high tech, semiconductor, life sciences, and medtech industries. Some of the biggest issues include:
- Needing to make decisions with incomplete data (48%)
- Spending too much time chasing down information from people and systems (41%)
- Too many surprises that derail needed work (28%)
Having inaccurate and inaccessible data is costly
The study unearthed a surprising discovery: Despite recent advances in technology, particularly around data and analytics, 65% of executives are less confident in the accuracy of their revenue reports than they were a few years ago. And as a result, the profitability of the business is impacted:
- 73% were frustrated that their pricing decisions meant they were leaving money on the table
- 42% reported they were giving higher discounts than needed to close deals
- 35% were overpaying rebates
- 98% said their customers were exposed to conflicting pricing
The impact of this revenue leakage is staggering. Unfortunately, given the current economic environment, companies cannot afford any revenue leakage. Across the board, there was almost unanimous agreement (99%) that identifying and closing revenue management issues would positively impact revenues. And 63% of executives estimate that closing all revenue leakage issues could result in a 4% impact to revenues. Doing so requires a deeper understanding of what’s causing these issues, as well as process improvements that eliminate silos and error-proned tasks.
Download the 2020 State of Revenue Report to discover where these improvements can be made and how executives expect technology can help them drive better business outcomes.