Mount Everest_Journey


The digital revolution is well under way. Organizations are navigating the digital transformation journey and modernizing legacy systems and offerings. However, along the way many are finding that migrating legacy models to recurring revenue and subscription-based models is more challenging than they expected.


One of the primary challenges of transitioning to an “as a service” (aaS) subscription model is changing the way an organization conceives of product strategy, offerings and monetization. Transitioning to a subscription-based recurring revenue model isn’t only about deciding on an annual cost and dividing it by twelve to determine a monthly payment. It’s about thinking of your strategy in terms of monitoring and monetizing utilization and features. Without this, you only have the illusion of a subscription monetization model.


Uneven Stones


First Step for Transitioning to an aaS Offering

The first step in being able to transition into real aaS offerings is to have a firm understanding of your products and product technology and to know if they can support being offered as a service. Are your products designed to have software that reports on feature (or other) usage? Do your products have the ability to “call home” and report back to your organization? If the answer to these questions is no, then your organization needs to re-evaluate and re-develop its product strategy to support the aaS subscription model.


Foot, Arrow Pointing This Way

Establishing Foundational Practices for Your aaS Offering

However, even if your products have the features and functions to be able to report on usage and adoption, none of that will matter if your organization does not have a solid IT Asset Management (ITAM) practice in place. How are you going to record, store, retrieve, align and monetize your product and subscription data if you don’t have the systems and methodology in place to do so?


IT Asset Management in the form of Software Asset Management (SAM) and Hardware Asset Management (HAM) are becoming increasingly important in the post-Covid digital landscape. Yet, the vast majority of ITAM practices and software are focused on individual enterprises managing the software licensing that they have purchased from their vendors. Vendors need comparable ITAM practices so that their customers can perform self-serve ITAM; the vendor can make sure that their customers are being billed appropriately; and so the vendor can find, audit and/or prevent any misuse of the products and services.


Tips for Using ITAM to Transition to aaS

  1. Ensure that you have the correct internal processes and systems that can absorb and render massive amounts of data at economies of scale. Throwing human capital at the issue with legions of spreadsheets tends to entrench bad habits and incur large OPEX costs.


  1. Understand that your data is not siloed; it is a connected experience for your customers and your channel. The quality and accuracy of your data is your lifeblood, and if you don’t have a grip on your product and contractual data, your customer base will certainly know and you will have to deal with a dearth of satisfaction issues (due to uncovered products, missed renewal events, lack of entitlements, etc.).


  1. Make sure that your organization understands the lifecycle methodology of IT asset data. Assets and their associated details are not static; they change over time and you need to be able to track the history of those changes (e.g., usage patterns over time) to be able to properly monetize and deliver your products and services.


Find the ITAM Solution that Works for You

At RAY ALLEN, Inc. we collect and reconcile data from all stakeholders (e.g., manufacturer/software publisher, vendor, customer) to create a Unified Source of Truth – accurate data, maintained over time – that you can trust. We work with you to make sure you have the ITAM solution that will provide a solid foundation for your aaS subscription offering and help you achieve your goals.


Contact us today to get started.