In the software world, categories like ERP (enterprise resource planning) and CRM (Customer Relationship Management) have created tremendous value, as seen with the success of companies like Salesforce.com and Workday.
But there may be a new category emerging: relationship business management or RBM. Think of this as essentially using new technologies to transform business models.
And the company that’s leading the charge is Zuora. In short order, it has made RBM a reality for many top companies like Acxiom, NCR, HP, American Express, TripAdvisor and Qualcomm.
OK, so what is the magic here? Well, at the core is a rethinking of how to relate to customers — that is, going from transactions to subscriptions. A clear example of this is Netflix, which has upended the media industry.
“Customers are demanding something different,” said Tien Tzuo, who is the CEO and founder of Zuora. “They want services. They want companies to take care of things.”
For this, customers are more than glad to shell out a periodic payment.
As for Zuora, the company is the operating system for making this happen. In fact, this week it launched the latest version, called Enterprise 9.
It’s certainly a leap forward. With Enterprise 9, a company can manage the heavy-lifting of billing, commerce and financial tracking — all at scale and with the utmost security. There is also extensive integration with legacy IT systems like Oracle and SAP.
“Our focus for Enterprise 9 is on large companies,” said Tien. “We can handle global, multidivisional enterprises.”
Now it's true that any technology is far from a cure-all. Let’s face it, there are many terrible companies -- and it will not matter what they do.
Then again, there are plenty of great companies as well, which could still be in jeopardy if they do not adapt to wrenching change.
“Maybe parents or grandparents will continue to buy in transactions,” said Tien, “but this will be less likely with their kids.”
The good news is that Zuora has built something that can help companies make the transition. “Enterprise 9 is not based on a strict approach,” said Tien. “Instead, we make it easy to provide for freedom and experimentation. This is the way to win.”
Tom Taulli is the founder of OptionTaxes.com, which helps with tax planning and preparation for incentive stock options, nonqualified stock options and restricted stock grants.
