ISG Research is happy to share insights gleaned from our latest Buyers Guide, an assessment of how well software providers’ offerings meet buyers’ requirements. The Revenue Performance Management: ISG Research Buyers Guide is the distillation of a year of market and product research by ISG Research.
For almost 20 years, the annual planning exercise at most enterprises has included planning for how the sales organization will address the following year’s territories, quotas and
In many organizations today, the sales department is being superseded by revenue teams. These revenue teams support a super-set of traditional sales functions that include not only those involved in gaining new customers, but also those with an increased focus on customer retention, expansion and cross-sell aimed at existing customers. As organizations embrace additional sales channels, whether through more typical indirect sales from partners or via new digital selling channels like e-commerce, revenue management will require an enhanced degree of alignment and coordination. The economics of multichannel selling and newer business models require the need to expand focus and resources beyond new business. This will impact not just sales and revenue teams but also marketing, partner management, commerce, subscription and customer service.
To achieve these aims, leadership and planning will be key. Any time an organization transitions to more modern approaches and processes, there will be resistance, missteps and potential disruption. Changes in the approach of strategic leadership and in the planning, monitoring and real-time adjustments via sales or revenue operation teams are essential. Revenue-driven organizations must manage operations with performance demands in mind and ensure consistent results every quarter, month in and month out. Revenue leaders need to implement processes that support overall strategy and growth, and also optimize both sales professional talent and the selling experience needed to achieve expectations.
ISG Research defines revenue performance management (RPM) as a coordinated set of revenue-generating and related activities, processes and systems that enable organizations to plan, execute, monitor and adjust in real time to achieve customer, product and revenue targets.
The need for enterprises to maximize outcomes from all channels and departments of revenue creates challenges for many organizations. Key revenue responsibilities across departments that generate new business and client relationships, retain existing ones through potential subscription renewals or upselling, and expand sales to existing customers are all about setting up revenue efforts in an effective manner. This includes territories that are balanced, quota and incentive compensation plans that are coupled with revenue resource capacity, and the development of reliable sales and revenue forecasts are key to achieving overall goals and outcomes.
New initiatives from technology providers that apply artificial intelligence (AI) and machine learning (ML) to historic data can create new insights to inform both management and revenue-focused professionals. The use of AI can be applied in a variety of different ways, from individual deal-scoring to overall pipeline health, customer churn risk prediction and identifying upsell and cross-sell opportunities for existing customers, as well as next-best-action recommendations. All this information can be used to inform revenue forecasts with a greater degree of accuracy and predictability than traditional bottom-up judgement forecasting on its own. And in response to the increased pressure to retain revenue talent, it can be used both to improve individual and team success and to highlight those at risk of leaving.
For many organizations, revenue is primarily derived from existing customers, so using extensive first-party customer data from all internal sources, including ERP, accounting, billing and support systems with third-party data, can help inform total customer lifetime value and be part of a more targeted territory, account and quota planning process. Ensuring that all buying and selling channels and departments contribute as fully as possible to the success of the organization—to retention, growth, profitability and the overall customer experience—requires not only dedication but effective strategy and planning. A well-developed strategy to utilize current and future talent for sales and revenue efforts is essential for the best possible performance. To carry out this mission, organizations need a set of coordinated revenue-related activities, processes and systems that enable the sales and revenue teams, from leadership and operations to the manager and sellers and customer success, to operate in a coordinated and collaborative manner. The evolution to RPM enables the ability to maximize outcomes across all buying or revenue channels.
Sales and revenue teams are designed to deliver the most effective return on an organization’s products and services across customers or consumers and must ensure that selling is done efficiently and intelligently. Sales and revenue channels and departments are typically complex entities, often with cultures and historical approaches that can inadvertently sabotage their performance. And many in leadership believe that sales teams can adapt and change their behavior without seeking out and using best practices.
In our view, effective management across sales and revenue operations requires well-designed and continuously optimized territories and accounts aligned with quotas that are designed to achieve an organization’s full revenue potential.
Use of analytics and data from operations and planning can assist in revenue-related compensation plans that utilize commissions and incentives to influence and align behavior and priorities. To optimize revenue performance, organizations must be able to design and apply incentives that motivate those supporting revenue generation to reach their targets. To evaluate whether compensation plans and incentives are effective, revenue leadership needs tools to help assess the relationship between plans, targets and actual performance. Comparing compensation and incentive plans among all revenue personnel, and with other parts of the organization, for example, can help managers determine whether what they provide is appropriate. Goals and objectives must be defined, established, tracked and then linked to incentives and rewards to help guide revenue performance. Moreover, organizations need to know whether their compensation is competitive in their market. Using benchmarks to compare compensation to that of others in the industry can provide this information. Likewise, the increasing complexity of omnichannel engagement is challenging organizations to develop plans that will achieve balanced revenue performance supporting overall objectives. Emerging AI-based optimization increasingly will offer more sophisticated guidance and aid in territory, account and quota alignment as well as help to design incentive plans that reflect omnichannel buyer engagement. In fact, we assert that through 2026, software providers will be utilizing AI to provide plan templates and optimization to both speed time-to-value and help enterprises deploy performance plans using best practices.
The traditional use of spreadsheets to manage revenue operations and performance is ineffective and can be problematic when trying to achieve optimal outcomes. Spreadsheets are not designed for managing the data needed across revenue channels or the varying types of buying and selling channels that must be measured toward goals and targets. Spreadsheets also cannot scale as a company grows. The use of multiple spreadsheets, often stored on users’ local drives, is a factor in producing scattered information, which the majority of organizations cite as a major impediment to managing revenue performance. A dedicated approach to RPM can provide a better method to achieve an organization’s goals.
Even revenue-related applications such as sales force automation (SFA) and customer relationship management (CRM) that are designed to capture data about accounts, contacts and opportunities cannot deliver optimal visibility into overall revenue performance in the way that a dedicated RPM system can. Dashboards and reports from SFA systems typically look only at historical performance, but backward-looking reports can’t provide timely guidance on the current state of quotas and incentives for sales professionals and are not flexible enough to provide information on, or credit, others involved in deals.
The next generation of revenue and sales leaders will embrace the need to focus on creating processes that generate and project predictable revenues. Revenue performance management systems should deliver functionality and support that enables organizations to plan for and optimize revenue growth across all relevant teams and channels. And in today’s fast-paced and dynamic business environment, the ability to react to changes on the ground with revised territories, one-off SPIFFs and adjustments to incentives requires applications to be responsive to non-IT admins and subject matter experts. Finally, the importance of aligning marketing, sales, operations, finance and HR means that RPM applications need to easily integrate and communicate with other core systems such as ERP, accounting, HR and CRM systems.
Our comprehensive evaluation of providers takes into consideration all the preceding characteristics needed for a revenue performance approach. Our Buyers Guide report will be of relevance to those organizations that have decided to adopt a revenue performance approach or are investigating it.
The ISG Buyers Guide™ for Revenue Performance Management (RPM) evaluates products based on sales and revenue resource capacity, territory and quota planning, incentive compensation planning and execution, sales and revenue forecasting, and the use of data and analytics to identify process improvements. The evaluation identifies capabilities that enable organizations to plan for and execute against objectives by aligning and incentivizing all those involved in supporting revenue and to identify ways to continually improve.
This research evaluates the following software providers that offer products that address key elements of revenue performance management as we define it: Anaplan, Board International, Oracle, Varicent Software and Xactly.
This research-based index evaluates the full business and information technology value of revenue performance management software offerings. We encourage you to learn more about our Buyers Guide and its effectiveness as a provider selection and RFI/RFP tool.
We urge organizations to do a thorough job of evaluating revenue performance management offerings in this Buyers Guide as both the results of our in-depth analysis of these software providers and as an evaluation methodology. The Buyers Guide can be used to evaluate existing suppliers, plus provides evaluation criteria for new projects. Using it can shorten the cycle time for an RFP and the definition of an RFI.
The Buyers Guide for Revenue Performance Management in 2024 finds Oracle first on the list, followed by Anaplan and Xactly.
Software providers that rated in the top three of any category ﹘ including the product and customer experience dimensions ﹘ earn the designation of Leader.
The Leaders in Product Experience are:
The Leaders in Customer Experience are:
The Leaders across any of the seven categories are:
The overall performance chart provides a visual representation of how providers rate across product and customer experience. Software providers with products scoring higher in a weighted rating of the five product experience categories place farther to the right. The combination of ratings for the two customer experience categories determines their placement on the vertical axis. As a result, providers that place closer to the upper-right are “exemplary” and rated higher than those closer to the lower-left and identified as providers of “merit.” Software providers that excelled at customer experience over product experience have an “assurance” rating, and those excelling instead in product experience have an “innovative” rating.
Note that close provider scores should not be taken to imply that the packages evaluated are functionally identical or equally well-suited for use by every enterprise or process. Although there is a high degree of commonality in how organizations handle revenue performance management, there are many idiosyncrasies and differences that can make one provider’s offering a better fit than another.
ISG Research has made every effort to encompass in this Buyers Guide the overall product and customer experience from our revenue performance management blueprint, which we believe reflects what a well-crafted RFP should contain. Even so, there may be additional areas that affect which software provider and products best fit an enterprise’s particular requirements. Therefore, while this research is complete as it stands, utilizing it in your own organizational context is critical to ensure that products deliver the highest level of support for your projects.
You can find more details on our community as well as on our expertise in the research for this Buyers Guide.