The business model, billing, provisioning, customer support and more

Kenneth TruemanBusiness model, General, Marketing strategyLeave a Comment

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(Image credit: Richard P J Lambert; https://flic.kr/p/oG1Uw3)

One of the first questions to ask for any business is, “What is the business model?”

Answering that question inevitably means first talking about billing. It’s where the rubber hits the road, where the theoretical becomes the real. Or not.

Billing is everything

Working for a phone company, there was a saying: “Billing is everything”. In the case of a 100-year old phone company (aka a telco), with disparate systems for the different offerings developed over the years, creating the customer bill was a major undertaking. (And if there was ever an example of “if it ain’t broke, don’t fix it”, then telcos are it.)

If yours is a new company, how it plans to bill for services, as well as to receive payment, has to be one of the first things to be settled. Billing is the final step in the business model. But it is surprising how often it is left as an afterthought. Do you expect to be paid in cash ? To be paid by check / cheque ? How about credit cards ? In person, via the web, over the phone ? How about PayPal ? These are incredibly important questions that need to be answered before customers are banging on the door and not after. (Unfortunately, it often happens that prospective customers are asked to wait while someone figures out how to create a bill / invoice, let along actually receive payment.)

What are your payment terms ? What if the customer pays early ? What if the customer pays late ? Your ability to bill and to be paid is key, no matter what your business situation: self-funded, venture-capital financed, etc.

But it turns out that there are many other steps that are just as important as billing. Like customer provisioning.

Customer provisioning is also everything

What is customer provisioning ? It is everything that happens once the contract or sales agreement is signed. It consists of the activities required to deliver the actual product or service to the customer, the thing that the customer is actually paying for. (In that regard, unless it is a specific revenue item in a contract, provisioning is a cost center. It does not generate revenues in and of itself, now or in the future.)

If you ship physical goods, customer provisioning involves setting up accounts, placing orders, and delivering goods to customers. If you are active on the web, you still need to create an account, activate a billing plan and provide access to the tools or services that come with the paid version (as opposed to a free version).

And more often than not, it is the type of detail that is left until the first customer is actually signed. Yes, after working so hard to attract a customer, via the web or by pounding the pavement, both at great cost, we ask the customer to wait while we figure out what comes next now that someone actually wants to purchase the product.

While it may not be practical to put in place every single component of the provisioning (also known as the on-boarding) process, it is important at a minimum to map out the major points, identify the types of inputs required from the customer as well as the outputs that the customer can expect and the timeframes that go with them.

Customer support is everything (too)

You might be starting to see a pattern here. Yes, like billing and provisioning, customer support IS everything.

And similar to the dynamic of provisioning, it is often something that is left until the last minute, when there is an actual customer that needs to be supported.

Who will answer the phone or respond to the email or the request on Facebook or Twitter? (These are all individual channels to be managed.) What about afterwork hours, on weekends or on holidays ? What will be said when someone wants support ? What commitments will be made to fix the problem or at least follow-up on it. Is there a service level agreement or a warranty in play ? How do you make sure that its clauses are respected ?

Everything IS connected

One way to think of an organization is as a pipeline, a continuous flow of activities, or as a series of touchpoints (each with a moment of truth), where when something goes wrong—and inevitably it will—it holds up everything that follows.

You can’t bill for a customer that is not provisioned. An unhappy customer without support is not a customer for long, and you can’t bill them anymore once they leave.

So these are all the types of things that need to be thought out—at least a high level—and taken care of before customers are signed.

This post was originally conceived with a song by the group Depeche Mode in mind. And it is correct in that, “Everything counts in large amounts”.

by Kenneth Trueman

Kenneth Trueman, Principal ConsultantKenneth Trueman is an experienced product marketer and business strategist with almost 20 years of experience working with technology companies, ranging from early stage start-ups to established small and medium-sized businesses and organizations with thousands of employees.

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