Thomas Pedersen
Thomas Pedersen

Bunny RevOps principle #5 - Quoting means clean data

Dirty data is like mold. Once it takes hold, it tends to spread and can be very hard to get rid of.

In the sales process, dirty data starts when a quote is being built in a spreadsheet. Although the quote looks structured, it is free form and ungoverned. It is not technically rooted in a product catalog. Salespeople can put in whatever they want. Discounting controls and approval processes can be skipped.

Quick aside. As a CEO, I have seen my share of closed deals where I felt we gave away the farm, and both the salesperson and their manager were in on it. But they were the heroes, because they closed the deal. Customer budget, competitive pressure and time were some of the reasons why they absolutely had to give so much discount in order to close the deal. But we all know the real truth.

But discounting is only one aspect of an unclean deal. There might be made-up line items can’t actually be enforced by the product. Or terms that are impossible for accounting to recognize revenue for.

Spreadsheet quotes have a trickle-effect of manual, error-prone steps.

Fulfillment - Once the spreadsheet quote is signed, it comes in as a DocuSign document or similar. Now it is up to someone in accounting or customer support to fulfill the order by using some kind of admin console in the platform to update the customer’s tenant with the agreed upon entitlements. Hopefully the quote didn’t contain any functionality that the platform can’t handle.

Invoicing - In order to collect the money for the deal, accounting now needs to create an invoice in the accounting or billing system. More manual data entry.

Revenue recognition - Ensuring compliance with ASC 606 requires accurate accounting of all revenue, a process often managed in large spreadsheets. This becomes particularly complex with subscription updates where quantities or plans change.

Revenue metrics - A SaaS company must be on top of its revenue metrics, but producing accurate metrics when your data is dirty becomes an exercise in massaging the data until you feel you can trust it.

Upsells and renewals - The dynamic nature of enterprise subscriptions, including upsells, downgrades and renewals, means the quote-to-cash cycle is perpetually restarted, each time more complicated because of amendments, proration and co-terming of dates.

Over time, the number of transactions for existing customers will outnumber new deals and the manual paper trail of subscription changes becomes a drag on the entire organization.

Quoting is something you want to introduce as early as possible in your sales process because it keeps your back office nimble.

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