Think about how your renewals are processed. Do you have a clear picture—from start to finish—of how every renewal is managed in your business? Are you comfortable that you're maximizing renewals using the most efficient process possible?
Most companies aren't. Until recently, renewals weren't recognized as the important revenue-generator that they are. And with the explosion of XaaS businesses, renewals have recently been pushed into the spotlight. Companies whose revenue models are based on recurring transactions are beginning to realize that spreadsheets and the old sales approach to renewals are not effective.
In the old approach, a salesperson calls the client at renewal time, issues a quote, processes revisions to the quote, runs the sales quote up and down the channel to distributors and vendors, and weeks later returns the approved quote to the client. The inherent lag throughout this process and the significant potential for data error create customer dissatisfaction, missed revenue opportunities, wasted time, and a whole host of other problems.
Now think about how your ideal renewals process would function. Map out what an efficient, effective workflow would look like for renewals management in your company. Would it look anything like these best practices for renewals processing?
1. Renewal Opportunities Pushed to Specialists, With Actionable and Priority Items at Top
A "live" list of opportunities is distributed to the renewal specialist, rather than the specialist needing to sift through customer data to identify contracts coming due for renewal.
2. Initial Automated Renewal Notification, 120 Days Out
When an existing contract comes within 120 days of its renewal date, a renewal notification email is automatically issued to the client. Tailored to your renewal strategy, the notice could discuss an automatic renewal, a negative or positive incentive to renew before the contract end date, and/or a renewal quote (with product and pricing data that was automatically validated).
3. Additional Automated Renewal Notifications at Predefined Periods
If the client does not respond, additional notice emails are sent out at additional incremental periods (60, 30, 0 days).
4. Automated Quote Revision, Review and Approval
If the client requests a change to the quote, changes are input to the renewals platform, automatically checked against a series of preinstalled business guidelines and automatically approved.
5. Quote-to-Cash Process is Completed in MinutesWhile manual quote review processes can take days or weeks, an automated renewals platform can establish an efficient quote-to-cash process that uses automation to obtain approvals and issue an invoice in minutes.
Best practices such as these will differ between companies, but the evolution from an old, manual approach to renewals management using an automated platform is clearly the future of renewals. To develop workflows that maximize your renewals, it's helpful to:
- Document your existing renewals workflows
- Determine the business goals for renewals
- Define what success will look like with a renewals management platform
The combination of an effective renewals platform and workflows that support your business operations and goals can quickly result in significant leaps in renewals success. Read more about strategies for implementing a renewals management platform by downloading our eBook, "Implementing a Renewals Platform: What You Need to Know."