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Copy of Selling SaaS in the Enterprise

A different Methodology to sell a SaaS solution in the enterprise based on lowering CAC
by

Nehal Alhusseini

on 15 May 2013

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Transcript of Copy of Selling SaaS in the Enterprise

Matrix Partners preso! Harvard Business Review How to lower the cost of enterprise sales? Introduction Approach to build our model BSC Concepts After that  we  linked them with the BSC four perspectives through performance indicators and perceptions. We used three types of performance measures (KPI, KPO, Perception) in the model. Profits on a 25,000 software license @IndoJacco Don't forget to call your Mom! T H N A K Y O U P R E Z I Gap is too big to close with traditional SaaS sales. Year 1 Year 2 Year 3 Risk with SaaS is way higher Perpetual SaaS Due to the increase in the competition among companies, many of them started searching for means and tools to bring them a competitive edge through learning from best practices in performance management. Integrating Balanced Scorecard (BSC) and the European Foundation for Quality Management (EFQM) is found to be one tool in this direction. Both the EFQM and BSC are tools that use measures of an organization’s performance to drive organizational improvement, generally by highlighting current shortfalls in performance, in areas of particular concern or interest to management teams Even though, these two models are very similar to each other, some differences exist such as the way they were designed, the background they built on, and processes of executing each. The BSC is a strategic performance measurement and management tool designed for the private sector acting as a communication/information and learning system, to measure ‘where we are now’ and ‘where to aim for next’. It prescribes a plan for translating ‘vision’ and ‘strategy’ into concrete action across four perspectives at different stages, depending on the business. Excellence Model is a non-perspective framework based on nine criteria, five of the criteria cover what an organization can manipulate, called "Enablers"; while the other four represent what an organization will achieve , named "Results" .
The model itself contains no detailed instructions for its use, although all nine criteria must be considered in the award assessment process. The balanced scorecard (BSC) is one of the most highly touted management tools today. The Balanced Scorecard Approach has been developed at the Harvard Business School by Kaplan and Norton since the early 1990s. It is an essentially multi-dimensional approach to performance measurement and management that is linked specifically to organizational strategy. The framework of the four perspectives of the BSC helps to translate strategy into objectives and measures. The four perspectives are financial, customer, internal process, and learning and growth * This project is intended to present integration of the EFQM and BSC.

* The project was mainly designed to develop the theory behind the integration of the BSC and EFQM and since.

* There is no Jordanian company exist that have them both. "Enabler" criteria Now we will take an example of how we build the model * In processes criterion, we formulated each sub criteria to become strategic objectives.

Then for each strategic objective we set a number of initiative that used to give guidance and clarify the purpose of the strategic objective , this initiatives taken from EFQM publication.  
We found that EFQM enablers and BSC perspectives intersect through the performance indicators so we linked each initiative with the BSC four perspective using suitable KPIs . Conclusion o EFQM Excellence Model DEFINITION The EFQM Excellence Model is a non-prescriptive framework for organizational management systems, promoted by EFQM formerly known as (The European Foundation for Quality Management) and designed for helping organizations in their drive towards being more competitive. Regardless of sector, size, structure or maturity; organizations need to establish appropriate management systems in order to be successful. BSC Definition EFQM Concepts The EFQM Excellence Model was introduced at the beginning of 1992 as the framework for assessing organizations for the European Quality Award . The EFQM Excellence Model is based on the accepting and consistent realizing in everyday practice “Eight Basic Rules of Excellence” that is adapted to the European conditions, the principles of the Total Quality Management (TQM), which implemented in the strategic management. i) The financial perspective indicates whether the transformation of a strategy leads to improved economic success.
(ii) The customer perspective defines the customer/ market segments in which the business competes.
(iii) The internal process perspective identifies those internal business processes that enable the firm to meet the expectations of customers.

(iv) Finally, the learning and growth perspective describes the infrastructure necessary for the achievement of the objectives of the other three perspectives In the first glance these two models are very similar to each other. Similarities like common goal, common ideas, both of them are behavior assessment models and are trying to improve behaviors and are base on cause and effect but in spite of this similarities, it is essential to know that the two approaches come from very different backgrounds ? Basically, we formulated the sub criteria for each enabler to become strategic objective, then we put appropriate initiatives for strategic objective The results of performance measurements are used as input information for benchmarking and developing the strategy of the company ,that provided company the ability to compare itself with other companies regardless of its sector, and thus can externally assess its performance (Benchmarking). *Clearly define their value propositions, ensuring sustainability by balancing the needs of all relevant stakeholders

*Define the business model in terms of core capabilities, processes, partners and value proposition.
*Implement the business model and value proposition by defining their "unique selling points", market positioning, target customer groups and distribution channels.

*Develop marketing strategies to effectively promote their products and services to target customers and user groups.

*Effectively market their product and service portfolio to existing and potential customers.

*Ensure that they have the capability to fulfill their promises We proved that the integrating between BSC & EFQM is feasible. According to the results of suggested list performance indicators, an organization can determine its performance and compare it with its target on a most detail level that can be linked to different perspectives as well as different criteria Recommendations The first recommendation for Jordanian organizations is to use these two models together as an integrated model based on what we developed. A superior understanding of organization’s process and its strategies is expected to be achieved by fully implementing the integration model of both of BSC and EFQM. The second recommendation is identify a better set of indicators that is based on practical aspects by refine tuning the indicators and their use. The third recommendation is to asses an organization based on this model and monitor its performance before and after using it and see the difference due to the implementation. The results in the EFQM model has been covered implicitly through the KPIs , then the organization will define its targets for each performance indicator Also it provides the company to asses itself by comparing the results with its target, and thus can internally assess its performance. If a low level of performance is signaled, company must re-examine strategy, align it with environment (market) / customer and set a new KPI targets
Excellent organizations design, manage and improve processes to generate increasing value for, customers and other stakeholders. Process Criterion Initiatives All initiatives covered through KPIs ,KPOs and perception We linked all initiatives of strategic objectives with customer satisfaction. Since there is no Jordanian company exist that have the EFQM and BSC both, we could not measure the expected benefit of the integration that includes: 1 . Alignment of activities at all levels, to achieve organizations strategic intent and knowing more and more details about its performance and how to manage it.

2 .Flexibility to react quickly to improvement opportunities based on the detailed output of the integration

3 .Achieve the organizations Strategy & objectives in the most effective & efficient way

4. The ability to focus effort on the detailed level of indicators that matter to all stakeholders (shareholders, customers, employees, suppliers,…) since all are included in the design of the integration.

5 .Establishing clear responsibility and accountability for each department by reaching a detailed level of concern and performance measure. Comparison of BSC and EFQM 1. Leadership: relates to the behavior of the executive team and all other managers in as much as how leaders develop. 2. People management: regards how the organization handles its employees and how it develops the knowledge and full potential its people to improve its business. 3. Policy and strategy: reviews the organizations mission, values, vision and strategic direction. 4. Resources: refers to how the organization managers and utilizes its external partnerships and internal resources effectively 5. Processes: concerns how the organization designs, manages and improves its activities and processes "Result" criteria 1. People satisfaction: investigates what the organization is achieving in relation to its employees

2. Customer satisfaction: measures what the organization is fulfilling in relation to its targeted customers.

3. Impact on society : concerns what the organization is achieving in satisfying the needs and expectations of local, national and international society as appropriate.

4. Business results :examines what the organization is achieving in relation to its planned business performance RADAR is a powerful tool for self-assessment and a basis for scoring the application for awards in EFQM model.
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