Why Revenue Lifecycle Management is Critical for Modern Revenue Operations and Beyond CPQ

Salesforce CPQ excels in supporting direct sales teams with essential quoting, product configuration, and pricing functions. However, for businesses seeking a sophisticated approach to managing the entire revenue lifecycle, Salesforce Revenue Lifecycle Management (RLM) offers a more advanced solution. Built directly “in core” on the Salesforce platform, RLM delivers enhanced performance, security, and scalability, making it ideal for complex revenue processes.  

Migrating to Revenue Lifecycle Management (RLM) offers a comprehensive approach that streamlines revenue operations and addresses many challenges. In this blog, we will explore the importance of migrating from CPQ to RLM and the benefits it brings.  

What is Revenue Lifecycle Management (RLM)? 

Revenue Lifecycle Management is part of Spring ’24 Revenue and is a comprehensive solution built on the Einstein 1 platform. It offers a unified system combining revenue and CRM processes. It is suited for omnichannel buying and selling. RLM supports business expansion and provides automation and revenue intelligence capabilities. RLM is designed as an extensible platform and provides composable APIs so that other cloud services can utilize its functionality. Salesforce has rebranded Revenue Lifecycle Management (RLM) as Revenue Cloud Advanced (RCA). This new name highlights its enhanced features and expanded capabilities in managing the entire revenue lifecycle. 

“Revenue Lifecycle Management (RLM) enables businesses to seamlessly integrate every stage of their revenue journey, from quoting to renewal, ensuring revenue automation, compliance, and faster time to revenue.”

–  Miles Sims, AVP Manufacturing & Logistics, Client Partner | LevelShift

Why Consider Migrating from CPQ to RLM?

• Modernize sales and revenue operations: CPQ offers features that enhance sales processes. However, updates to contracts can sometimes lead to delays. Transitioning to RLM allows businesses to build on the strengths of CPQ. This shift ensures a faster sales cycle, reducing the friction associated with contract updates.
• Streamline quoting, contracting, and revenue management: RLM features such as guided tools assist sellers in creating precise quotes, and AI-powered contracts simplify the entire contract lifecycle.
• Support complex revenue recognition and recurring revenue: Migrating from CPQ to RLM automates billing and revenue operations. RLM accommodates various monetization models, including one-time, subscription, usage-based, or hybrid.
• Improve compliance with ASC 606/IFRS 15: If you’re focused on direct transactions, CPQ is the way to go. However, for complex revenue scenarios that demand accurate tracking and strict compliance, RLM shines by effectively addressing regulatory requirements.
• Achieve seamless omnichannel experiences: RLM streamlines omnichannel sales experiences through its API-first architecture, contrasting with CPQ’s later-added APIs. The robust API framework is essential for maintaining product and pricing data consistency across all sales channels, self-service portals, and third-party sites.

Six-Stage CPQ-RLM Migration Strategy

The migration strategy provides a structured approach to transitioning from an existing CPQ to an RLM solution, which offers better visibility into revenue streams.

1. Assessment phase: Conduct a comprehensive review of your existing Salesforce CPQ configuration and processes to identify how well your current setup supports the entire revenue lifecycle. This involves evaluating each stage and pinpointing areas where the system may fall short.

2. Planning and preparation: Define clear objectives for your RLM migration, such as automating billing or enhancing contract management efficiency. Assemble a cross-functional team from sales, finance, and other departments to oversee the process. Create a project timeline with key milestones and deadlines.

3. Data mapping and transformation: Map and align product, pricing, contract, and revenue data between CPQ and RLM to ensure seamless data transfer. This involves extracting and cleaning existing data from CPQ, ensuring that product configurations, pricing rules, and contract terms details are accurately reflected in the RLM system.

4. Process realignment: Shift your organization from focusing solely on transactional sales to adopting a holistic revenue lifecycle management approach. This transition emphasizes building long-term relationships and delivering ongoing business value.

5. Customization and configuration: Configure RLM modules to align with your unique business rules, such as pricing structures and discount strategies. Tailor the modules to ensure they integrate smoothly with your existing systems.

6. Testing and validation: Conduct thorough and systematic testing to verify that revenue schedules are accurately generated according to the new RLM configuration. Ensure billing logic, including invoicing, contract terms, and payment schedules, is correct and aligns with business rules.

Benefits of Migrating to Revenue Lifecycle Management

• Ensured precise revenue recognition in compliance with accounting standards.
• Reduced manual adjustments and errors in revenue reporting.
• Unified view of the customer lifecycle, from quotes to renewals and billing.
• Automated renewals, billing, and amendments to ensure continuity.
• Streamlined processes across sales, finance, and customer service teams.
• Reduced time spent managing contract changes and billing updates.

Salesforce RLM: A Central Force in the Growing RevOps Market

Gartner predicts that 75% of the world’s highest-growth companies will adopt a RevOps model by 2025. As the RevOps market expands, Salesforce’s all-in-one RLM could play a central role in meeting evolving business needs, especially with its growing AI integration.

Drive Revenue Success with LevelShift

LevelShift streamlines your time to revenue with Revenue Lifecycle Management’s robust features, including product catalog, pricing, configurator, quoting, and asset management. We ensure a smooth CPQ to RLM migration, providing expert guidance tailored to your business.

Ready to transform your revenue processes? Contact LevelShift today to learn how we can accelerate your CPQ to RLM migration and drive business success.

FAQs

1. What is Revenue Lifecycle Management?

An end-to-end solution built on the robust Einstein 1 platform. RLM integrates revenue and CRM processes into a unified system.

2. What is the difference between CPQ and RLM?

CPQ (Configure, Price, Quote) is a sales tool for creating customized quotes based on product configurations and pricing rules. RLM encompasses the entire revenue process, including order management, billing, revenue recognition, and contract management.

3. What is RevOps?

RevOps (Revenue Operations) is a strategic business function that aligns sales, marketing, and customer success teams to drive revenue growth.