Bad Data Hygiene Kills Usage Billing

Welcome to The Margin, a newsletter designed to keep you on the leading edge of monetization.

In business, the difference between being ahead of the curve or slow to adapt is anything but marginal. The Margin aims to be the most useful, timely, and incisive ping that hits your inbox all week. It includes critical research and analyst insights to inform short and long-term decision making.

Research Spotlight

Is bad data hygiene the silent killer of monetization initiatives?

MGI Research finds over 70% of billing system implementations stumble or fail to meet targets due to deficient data management. While executives intuitively grasp the importance of sound data, proactive strategies to address it are rare. Too often, data management is an afterthought, lacking clear ownership, budget, or established processes.

Dirty Data Kills! explains how addressing data management issues significantly reduces the risk of missed objectives in billing projects. Organizations often acknowledge the proliferation of dirty data, but few fully appreciate its impact across the quote-to-cash process – or the knock-on effect on customer experience and NPS scores.

MGI estimates a mere 0.1% error rate due to dirty data in quote-to-cash systems leads to at least 1% revenue leakage.
Without consistent focus and investment in data management, negative downstream impacts include lower customer satisfaction, higher churn, and higher costs to serve.

Business and finance teams frequently express difficulties in obtaining accurate and timely data. The rapid growth in data volumes and the complexities of integrating disparate sources compound these challenges. Conversely, “data readiness” and “data cleanliness” are consistently cited as top drivers of successful projects.

The Dirty Data Kills! research note highlights three primary areas contributing to quote-to-cash and billing data problems:

Lack of proper scope: Companies underestimate the complexity of the data challenge and treat it as a one-time event instead of a continuous program.
Change: The rapid evolution of pricing and billing models clashes with outdated methods of extracting data and feeding it into modern agile billing systems. Business change is outpacing legacy integration technologies and approaches.
Lack of focus on data: Organizations tend to prioritize people, process, and tools in technology initiatives, and neglect the critical fourth pillar: data. Modern billing applications rely on data from numerous sources, underscoring challenges in data custody and integration.

The Bottom Line | Success in billing and quote-to-cash modernization requires a holistic approach to data management. Current business trends like usage and consumption models, dynamic pricing, and AI innovations depend on the continuous availability of clean and auditable data. Investing in data management is as crucial as investing in process optimization and vendor evaluations to increase the probability of project success.

Read the research note and compare the nine dimensions of billing data challenges to your project. These include:

Data hygiene
Data supply and distribution
Data volume growth and velocity
The 3-S challenge (structure, syntax, semantics)
And more

Tune In to MGI

Is AI Going to Replace Your Billing?

AI promises both opportunity and upheaval across enterprise functions, and billing is no exception.

The Configure Price Quote (CPQ), Contract Lifecycle Management (CLM), Customer Resource Management (CRM), and Automated Revenue Management (ARM) markets have already been reenergized with widespread announcement of AI tools. Is AI accurate, transparent, and auditable enough to replace your billing? What AI-related ideas and concepts are truly innovative vs. table stakes? Can customers afford to wait, or does this require attention and investment today?

Join MGI Research for an exclusive webinar on Thursday, March 27 at 8am PT / 11am ET to find out:

What are the current and emerging AI use cases within agile billing?
Which innovations are billing suppliers prioritizing? Are real-world deployments already being undertaken by leading vendors like SAP, BillingPlatform, and Zuora?
Is it necessary to allocate dedicated AI budget to billing? Will vendors absorb the cost of supporting AI?
What is the timeline for integrating AI capabilities to maintain a competitive position in the evolving billing landscape?
Are issues like data privacy and governance, compliance, and data leakage threats to the mainstream use of AI in billing? Can vendors and users mitigate these risks?
Which fundamental AI features should now be considered table stakes from any agile billing vendor?

Rewind | Last month’s webinar detailed the opportunity for finance leaders to drive business growth by transforming the order-to-cash process. Revenue controller and order-to-cash veteran Jane Koltsova joined the MGI analyst team to share her experience in improving finance’s discipline and performance – while supporting a sales-driven culture.

Watch Transforming Order-to-Cash: Finance’s Moment to Lead on-demand.

On the Horizon

Monetization A to Z available next month

Monetization A to Z is an executive guide for decision-makers to sharpen their knowledge and learn from quote-to-cash industry leaders.

The project comprises twelve individual chapters and accompanying video interviews, each focused on the insights and experiences of a different monetization thought leader. These conversations explore the complexities and evolution of modern business models, particularly around usage-based pricing, AI innovations and deployment, and strategic approaches to data management, product-led growth, and multi-tier channel monetization.

The e-book and video series include:

Is Usage Right For You? | LogiSense CEO Adam Howatson weighs the pros and cons of usage-based go-to-market models and explains how to assess if an organization is ready to implement consumption billing.
Tien Tzuo on Modern Monetization | Tien Tzuo, CEO and co-founder of Zuora, explores the shift from one-time transactions to long-term customer relationships, advocating for a dynamic, mixed-model approach to pricing, packaging, billing, and revenue management.
Leveraging AI for Price Optimization: Lessons from an Airline Pro | Dr. Michael Wu, Chief AI Scientist at PROS, outlines how organizations can follow in the airline industry’s footsteps by investing in data readiness, agility, and AI-powered tools to support dynamic price optimization.
Aligning Company Culture for Holistic Usage Adoption | Amberflo founder and CEO Puneet Gupta argues that the shift to usage presents a strategic opportunity for CIOs to implement a cohesive infrastructure for metering, cost tracking, and flexible pricing, fostering organizational alignment and long-term growth.
Beyond ERP: Monetizing the Multi-Channel Organization | Youssef Yaghmour, CEO and founder of BluLogix, discusses how traditional ERP systems fall short in managing complex subscription, usage-based, and multi-channel revenue environments.
And more!

Monetization A to Z will be available on April 22.