Ventana Research Analyst Perspectives

Order-to-Cash Cycle for Revenue Recognition

Posted by Ventana Research on May 27, 2015 3:26:56 AM

Revenue recognition standards for companies that use contracts are in the process of changing, as I covered in an earlier perspective. As part of managing their transition to these standards, CFOs and controllers should initiate a full-scale review of their order-to-cash cycle. This should include examination of their company’s sales contracts and their contracting process. They also should examine how well their contracting processes are integrated with invoicing and billing and any other elements of their order-to-cash cycle, especially as these relate to revenue recognition. They must recognize that how their company structures, writes and modifies these contracts and handles the full order-to-cash cycle will have a direct impact on workloads in the finance and accounting department as well as on external audit costs. Companies that will be affected by the new standards also should investigate whether they can benefit from using software to automate contract management or in some cases an application that supports their configure, price and quote (CPQ) function by facilitating standardization and automation of their contracting processes.

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Topics: Budgeting, Business Performance, Financial Performance, Governance, Planning, Recurring Revenue, Reporting, Tax, Office of Finance, Revenue Performance

New Revenue Recognition Rules Require Software

Posted by Ventana Research on May 12, 2015 9:32:39 PM

For most of the past decade businesses that decided not to pay attention to proposed changes in revenue recognition rules have saved themselves time and frustration as the proponents’ timetables have slipped and roadmaps have changed. The new rules are the result of a convergence of US-GAAP (Generally Accepted Accounting Principles – the accounting standard used by U.S.-based companies) and IFRS (International Financial Reporting Standards – the system used in much of the rest of the world). Now, however, it’s time for everyone to pay close attention. Last year the U.S.-based Financial Accounting Standards Board (FASB, which manages US-GAAP) and the Brussels-based International Accounting Standards Board (IASB, which manages IFRS) issued “Topic 606” and “IFRS 15,” respectively, which express their harmonized approach to governing revenue recognition. A major objective of the new standards is to provide investors and other stakeholders with more accurate and consistent depictions of companies’ revenue across multiple types of business as well as make the standard consistent between the major accounting regimes.

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Topics: Budgeting, Business Performance, Customer Performance, Financial Performance, Governance, Planning, Recurring Revenue, Reporting, Tax, Office of Finance, Customer Experience, Revenue Performance

Nomis Solutions Targets Price and Revenue Optimization in Financial Services

Posted by Ventana Research on Apr 29, 2015 8:27:10 AM

Price and revenue optimization (PRO) software uses analytics to help companies maximize profitability for any targeted level of revenues. PRO utilizes data about buyer behavior to gauge individual customers’ price sensitivity and predict how they will react to prices. It enables users to charge buyers who appear to be less sensitive more than those who appear more price-sensitive.  PRO is a significant departure from inward-focused, single-factor pricing strategies such as cost-plus pricing or, in the case of financial services, risk-based pricing (using a borrower’s credit score, for example). Instead it offers a multifaceted customer-centric analytic approach to pricing built on analysis of large sets of data.

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Topics: Business Performance, Financial Performance, financial services, Office of Finance, Nomis Solutions, Revenue Performance

NICE to Acquire Merced Systems for Excellence in Customer Service and Sales

Posted by Mark Smith on Dec 6, 2011 11:45:54 PM

NICE Systems last week announced an agreement to acquire Merced Systems, a provider of business applications for customer service and sales organizations. This acquisition slipped by with little fanfare, but it marks a significant milestone for NICE, a major provider of applications and technology for call centers and a player in their evolution into multichannel contact centers. Building on a good 2010, as my colleague Richard Snow noted, NICE expects to reach almost $800 million of revenue in 2011, which would make it one of the largest companies in its segment. NICE has made multiple acquisitions to build its software portfolio, including purchases of Actimize, CyberTech, eGlue and others mentioned below. It recently won our 2011 Ventana Research Leadership Award in the contact center category with its customer deployment at Alliance Data. NICE Systems plans to have Merced Systems as a foundation of its enterprise systems and a complement to its contact center workforce optimization offering. This purchase builds on its other acquisitions, including FizzBack recently and IEX and Performix in 2006, which helped NICE establish its customer service and back office agent performance management software. That area has not grown as quickly as NICE would like, mostly due to marketing that was not aggressive enough in attracting customers. NICE recently rebranded its NICE SmartCenter for helping agents, as Richard noted, and is leveraging its assets into the back office, which he also assessed. Our benchmark research on contact center technology found that companies’ priorities for future investments match up well with NICE Systems’ focuses on expanding customer service agent applications and analytics applications.

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Topics: Business Analytics, Business Collaboration, Business Mobility, Business Performance, Call Center, CFO, Cloud Computing, CMO, Contact Center, Contact Center Analytics, CRM, Customer Analytics, Customer & Contact Center, Customer Data Management, Customer Feedback Management, Customer Service, Desktop Analytics, Financial Performance, Marketing, Merced Systems, Operational Performance, Predictive Analytics, Revenue Performance, Sales, Sales Compensation, Sales Force Automation, Sales Performance, Sales Performance Management, SFA, Social CRM, Social Media, Speech Analytics, Text Analytics, Unified Communications, Voice of the Customer, Workforce Management, Workforce Performance, Customer Experience, Analytics, NICE Systems

Varicent Improves Sales Operations Efficiency

Posted by Mark Smith on Aug 31, 2011 9:57:21 AM

Sales organizations strive to maximize the performance of their staffs to meet quotas and revenue targets in an efficient manner. This focus is part of my agenda to help organizations innovate and maximize revenue in sales. To achieve this requires automation of various sales activities including compensation, incentives, quota development, territory optimization, channel management, analytics and planning. Varicent is focused on these aspects of sales, offering software deployable in three ways: rented in the cloud, hosted for easier management or purchased for use inside the organization. My last analysis of the company and its products was part of our 2011 Value Index for Sales Performance Management; in it we rated Varicent a Hot Vendor overall across our seven evaluation categories applied to its application suite. That analysis included our analysis of Varicent SPM version 7 that made significant advances in the use and process of managing compensation and incentives but also the rest of their application portfolio from territory management, sales quota management and channel management. 

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Topics: Business Analytics, Business Collaboration, Business Mobility, Business Performance, CFO, Cloud Computing, CMO, CRM, Customer & Contact Center, Financial Performance, Marketing, Operational Performance, Revenue Performance, Sales, Sales Force Automation, Sales Operations, Sales Performance, Sales Performance Management, SFA, Social Media, Varicent, Workforce Performance