Since 2005, TSIA has been tracking—in our widely-followed Service 50 index—service revenue and profit trends in the technology industry. And the trends have very clearly pointed to an increasing reliance on both service revenues and profits to sustain the health and growth of technology product companies.
In the last three years, as the economy has floundered, there has been an even greater reliance on the service revenue stream. CEOs and CFOs have increased the growth expectations from the sales and marketing leaders that manage these service revenues. Add to that the introduction of more complicated, converged service offers; the effects of cloud computing; growing challenges to the traditional maintenance value proposition; and the dominance of a largely product-oriented sales culture—and the net effect is a huge escalation of interest in optimizing the service revenue stream.
In response to this unprecedented confluence of market forces, TSIA has introduced a new service discipline: Service Revenue Generation, or SRG. SRG is TSIA’s fifth service discipline, and the first that is horizontal across the spectrum of traditional technology service disciplines.
SRG
Research Calendar
TSIA held a planning session at TSW Las Vegas 2011 with the Founding Members of the Service Revenue Generation discipline. The session was held in order to determine and understand the business priorities of these founding members. A key takeaway: We will strike a balance with helping SRG member companies defend, protect, and optimize their existing service revenue lines, while also helping them transform to new revenue streams.
The SRG Benchmark Survey will focus on optimizing current revenue streams including the renewal and up-sell of:
- Maintenance and support contracts
- Subscription plans
- Managed service contracts
- Annuity-based value-added services
TSIA will also launch significant research studies on best practices to drive service revenue growth beyond traditional maintenance and support offerings, including:
- Transitioning to the cloud and cloud business models
- Unique challenges with selling and renewing managed services contracts
- Broadening the service portfolio to include annuity-based value-added services
Click here to view the 2012 SRG Research Calendar. Click here to download the complete 2012 TSIA Research Agenda.
Consumption Economics Impact on Service Revenue Generation
The transition from the traditional service revenues of installation, implementation, and maintenance to micro-transactions will be challenging. But the first step is to recognize how much pressure is on these traditional revenue lines for technology companies. Software as a service (SaaS) companies and utility business models have changed customer expectations with respect to ease of startup, payment over time, and payment for usage. The new customer expectation we need to embrace is “no usage, no money.”
Click here to download TSIA’s take on “The Implications of Consumption Economics for Service Revenue Generation.”
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SRG Blog: Up and to the RightJulia Stegman has 27 years’ experience in the high-tech industry, having held services sales and general management roles throughout her career. She has driven profitable revenue growth for the services businesses of Hewlett-Packard and Sage Software. Her services sales experience spans across hardware and software, enterprise and SMB customers, and North American as well as global markets. |
For information on how to join the SRG-R service discipline, complete the form below or contact your membership development director.