Customer-centricity is the new black. The trend is evident across every industry, and there are no shortage of examples demonstrating how service-oriented businesses like Zappos and Rackspace that form lasting relationships with customers are outperforming competitors — including several incumbents and industry heavyweights— that miscalculated customers’ willingness (desire?) to choose an alternative provider. One critical component these businesses share is the ability to provide customers with real-time access to account information and frictionless billing.
Despite its well-earned reputation as a laggard, the telecommunications industry deserves some credit for the evolution of today’s anywhere access to real-time account information. In fact, virtually every wireless provider now allows customers to access account information about monthly data usage and minutes available through an app or web portal, self-selecting plan options or purchasing an additional allotment to avoid overages. This is a massive change when you consider that even ten years ago, the only way to receive detailed information about your billing plan was to visit a local branch at the end of your billing cycle and request your full statement.
Amazingly, the days of bill shock are virtually over.
CFOs: Holding the Keys to Customer Analytics
At the same time, businesses in other industries are struggling to keep pace. According to research by Saugatuck Technology, more than 80 percent of CFOs and finance leaders have either already moved to a modern Finance system or are actively looking to upgrade. Motivations vary from reducing costs to improving controls over core accountabilities such as auditability and regulatory compliance; however, for most CFOs a primary reason for investing in modern financial management tools is to keep pace with a rapidly evolving business climate.
Today, more than half of Fortune 2000 finance departments rely on manual processes and antiquated tools which, while adequate for closing the books, don’t provide the type of real-time access to business data required to compete in today’s “big data” economy. In speaking with CFOs, it’s not uncommon for them to liken the process of tracking down up-to-date information about a customer’s account status with watching a match at Wimbledon —a seemingly never-ending game of volley between sales and accounting.
This problem is only exacerbated by more complex revenue models. For example, a traditional enterprise contract may include a variety of payments including up-front costs, activity-based charges and annual “true ups” to meet previously agreed upon commitments. What happens when the business customer expects the same anytime, anywhere access to account information from the service provider that he/she gets from their cell phone provider? What happens when your competitor begins using this ability as a key selling point to differentiate its offering?
Cloud Computing Built for CFOs
Over the past decade, the maturation of cloud computing has changed every aspect of business, however until recently finance and accounting have remained a noteworthy exception. While Salesforce.com became the de-facto standard for sales, finance professionals continued to track and manage business-critical financial data in simple spreadsheets like Excel. Only recently have CFOs — now tasked with overseeing IT in addition to Finance and HR — realized that the cobbler’s children need shoes too.
Not surprisingly, the need for improved agility and business intelligence has spurred a new market of cloud-based billing providers, estimated to grow to roughly $10 Billion in the next five years according to a recent report. Instead of choosing between low-cost tools like Excel or multi-million dollar ERP implementations, CFOs now have access to role-specific, cloud-based financial management platforms designed to automate billing processes and unlock valuable sources of customer data, including purchasing patterns, granular usage-based rating and measurement as well as up-to-the-minute information about billing status and company revenues.
Leading cloud-based systems also offer CFOs the flexibility to monetize more effectively, including support for multi-dimensional pricing, allowing the business to bundle recurring subscriptions with activity charges controlled by the customer.
After years of feeling beholden to vendors, it is clear customers have taken back control opting to spend with innovative providers willing to conduct business on their terms. CFOs need to evaluate whether their existing billing processes are sufficient to meet these new demands or if they represent a liability to the future success of the business.
(Chris Couch is Co-Founder and Chief Operations Officer at Transverse)