In looking at some recent key trends in product management for XaaS (as-a-service/subscription) offers, it’s clear that revenue growth has been eroding for B2B technology providers, and what revenue there is has increasingly been coming from services rather than from technology sales. What does this mean for Product teams who need to adapt to new XaaS business models but aren’t sure of next steps to take? In this SlideShare, I go over the changing conditions Product Management teams are facing, the impact of these changes, and provide a glimpse of how you can overcome the top 10 XaaS Product Management challenges affecting the industry. Let TSIA Help You Overcoming Your XaaS Product Management Challenges This is just a brief snapshot into a larger body of research TSIA has recently introduced in the form of our XaaS Product Management research practice. Membership in XaaS Product Management will give you the industry insight, tools, and expert advice you need to overcome all 10 of these challenges and more as your Product Management team works toward adapting to customer demands for subscription offers in addition to unparalleled technology. Contact us today to learn how TSIA can help you reach your business objectives even faster. www.tsia.com/xpm.

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Optimizing XaaS Product
Management Practices for
Business Growth and Profitability

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The best practices and thought leadership your organization needs to succeed.
TSIA has the world’s
largest vault of
board-ready data insight
in technology and services.

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Get a Glimpse into Our Vault
Here’s a look at some key
technology industry trends

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Key Research Trend #1
Over the past decade, revenue growth and margin has been eroding
from the business models of B2B technology providers.
• Top-line revenues
• Technology product revenues
• Hardware product margins
• Operating incomes
• Gross margin
Service
Revenues
Subscription
Revenues
Source: TSIA: T&S 50 & Cloud 40 Index

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$94,917
$117,743
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
$180,000
1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
USDMillions
Service vs. Product Revenues
Sum of Product Revenue Sum of Service Revenue
Key Research Trend #2
Revenue has also has been shifting from technology
to services for B2B technology providers.

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Customers and markets
are demanding new
technology consumption models.

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The Impact?
Product Management practices are not optimally
aligned for XaaS transition, growth, and profitability.
Changing Conditions Impact
EconomicEngines
BusinessKPIs
CustomerExpectationsandObligations
CustomerEngagementModels
ProductandServiceConvergence
LowProfitabilityofXaaSBusiness

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These changing conditions
create new challenges for
Product Management.

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What are the
effective methods for
customer transition
to XaaS models?
What technical
capabilities should
the product have to
accelerate adoption
and expansion?
6
What telemetry
does the product
need to optimize the
total customer
experience?
7
What are the best
methods for pricing
XaaS offers?
3
What is the
economic engine for
a profitable XaaS
Offer?
1
What are the new
cross-functional
handshakes
necessary for XaaS
in-market success?
9
What KPIs drive
Product
Management
behaviors in XaaS?
4
How should the
organization adapt to
the faster product
delivery cadence?
8
What is the optimal
Product
organizational design
for the XaaS
business?
5
How does XaaS
offer development
differ from traditional
technology?
2
Top 10 X-as-a-Service Product Management Challenges
10
Source: TSIA Surveys & Interviews with > 50 CPOs, 2018

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What KPIs drive
Product
Management
behaviors in XaaS?
4
Source: TSIA Surveys & Interviews with > 50 CPOs, 2018
Let’s Take a Closer Look at One XaaS Product
Management Challenge

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XaaS Product Management
is measured on Revenue
Growth, specifically
Recurring Revenue
Growth.
Source: TSIA XaaS Product Management Survey - 2018
82%
Did you know…

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But…
XaaS Product Management is not
effectively engaged in activities that
drive Product Adoption.
Recurring Revenue Growth is a function of Product
Adoption
Source: TSIA XaaS Product Management Survey - 2018

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Sources: XaaS Product Management Survey, Spring 2018; TSIA Customer Success Benchmark Survey 2017
Just…
36%
Of Product Management
teams participate in the
proven practice of
customer journey
mapping.
29%
Fit their products with the
telemetry needed for usage
intelligence.
32%
Consider Customer
Success team feedback
in their product roadmap.
15%
Use product consumption
analytics in product roadmap
decision making.

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Start adopting
proven practices.
Source: TSIA XaaS Product Management Survey - 2018
How can you increase the effectiveness of your
XaaS Product Management team in Growing Recurring
Revenue?

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Recommended Product Management Practices
to Drive Product Adoption
Get started with instrumenting your technology with
the right telemetry
Get a handle on analyzing product consumption data
Get serious about driving the customer journey
directly within the product
Source: TSIA Research Report. Laura Fay, 2018. Product Analytics: How Product Management is leveraging analytics to understand customer behavior.

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Set a goal:
Set MBOs for your XaaS Product Management
team to drive product adoption.
Let TSIA’s XaaS Product Management
research practice show you how.
www.tsia.com/xpm
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