Customer Success Summit 2015 breakout session: Presented by: Ariel Utnik, VP of Customer Success, Panaya

1. Produced by
Understanding why
customers churn…..
and making it next year’s
business plan!

2. About Panaya & Me
About Panaya:
• Panaya CloudQuality™ Suite disrupts the
risk, time and costs required to deliver all
types of SAP®, Oracle® EBS, and
Salesforce changes.
• Recently acquired by InfoSys for $230M
About me:
• In love with the Customer Success
mission, with special focus on churn
reduction and prevention

3. Background
• Very successful and growing company with good
repeating ERP upgrade ratio
• Repeating is not Renewing
• The cost of not having significant renewing
customers is a full re-selling process and cost to
existing customers
• The assumption was that this is the “nature of the
business”

4. The Challenge
• There was no understanding or alignment regarding
the characteristics and root causes of renewing vs
repeating customers
• The organizational data wasn’t accurate and couldn’t
support BI research
• Company’s new CEO and board defined renewals as
the highest priority, to both understand and solve

5. Step One
• Data integrity
– 6 month project for fixing the company data
– Setting the right processes to ensure future data
integrity
– Defining the infrastructure for data mining

6. Step Two
• Understanding the root cause
– Slice and dice the renewal and churn data with
large numbers of parameters
– Checking what the parameters are that identify,
impact and predict customer churn

7. 7
Renewals 2013-2014
ERP vendor
ERP vendor SAP Oracle
Potential 650X 190X
Actual 266X 42X
Percentage 40X% 22X%
Higher renewal rate in SAP vs Oracle due to limited Oracle testing service

8. 8
Renewals 2013-2014
Account type (Primary SI)
Account type Customer System Integrator
Potential 629X 211X
Actual 268X 38X
Percentage 42X% 18X%

9. 9
Renewals 2013-2014
Contract
term
(months)
Project
base: 0-
11
12 13-23 24 >24
Potential 359X 347X 73X 28X 33X
Actual 58X 208X 10X 16X 16X
Percentag
e
16X% 58X% 14X% 57X% 49X%
• Selling Panaya for projects (less than a year) has lower chance for renewal
• Yearly subscription (12,24,>24) has higher renewal rate

10. 10
Renewals 2013-2014
Product family
Product
family
SAP Upgrade SAP Upgrade
+ Testing
SAP EHP SAP EHP +
Testing
SAP SPS SAP SPS +
Testing
Testing
Only
Panaya
Standard
Potential 122X 48X 90X 78X 38X 58X 52X 128X
Actual 12X 10X 12X 26X 18X 28X 36X 102X
Percentage 10% 20% 13% 33% 48% 66% 70% 80%
• Bundle with testing increases the
renewal rate significantly
• Panaya Standard (similar to PCQ all
included) has the highest renewal rate
PCQ

11. 11
Renewals 2013-2014
Major account vs. region
Major Region Americas APAC EMEA
No Potential 284X 97X 365X
Actual 98X 16X 126X
Percentage 34X% 16X% 34X%
Yes Potential 51X 3X 37X
Actual 45X 0X 12X
Percentage 90% 0.00% 32%
• High renewal rate in Major accounts in Americas
• Same renewal rate for major and non major in EMEA and similar to non major
in AMR

12. Step Three
• Company plan
– Highlight the main parameters that impact the
company renewals and churn
– A cross company plan defining what needs to be
done to solve each area
– A plan, per department, with details of their
share in the plan

13. Renewal rate – Root Cause Analysis
Oracle revenue is 25% of the business with XX% renewal rate
System Integrators (SI) business is 22% with XX% renewal rate,
Major System integrators (IBM, HP, Deloitte) business is 10% with
XX% renewal rate
IBM with 0% renewal rate
Project-based (less than a year) is 40% of deals with XX% renewal rate
Selling without testing bundle has only XX% renewal rate
Majors in EMEA has XX% renewal rate (Majors in AMERICAS 5XX%)

14. Renewal rate – 2015 Game play
Oracle revenue is 25% of the business with XX% renewal rate
Oracle Testing GA + Oracle Patches coverage
System integrators (SI) business is 22% with XX% renewal rate
AMS Deals + Build direct relation with the customers
Project-based (less than a year) is 40% of deals with XX% renewal rate
PCQ Play
Selling without testing bundle has only XX% renewal rate
PCQ Play
Majors in EMEA has XX% renewal rate (Majors in AMERICAS 5XX%)
Rollout EMEA field
Align CSM touch model and CSM customer ratio
CSM high touch model for Recurring and Major customers
Find the correct formula to transition customers from maintenance to multi-
functional project usage
Funnel management with stages and alerts

15. Step Four
• Company alignment and dashboards
– A company renewal real-time dashboard available to all
– Renewal data from company level, region, team and down
to the CSM and sales person
– Clear renewal KPI with impact on individual compensation

16. What Were the Results?
• 190% improvement in first 6 months
• Renewal $ was tripled
• Additional 140% improvement planned for 2015

17. Take-aways
• 3rd step:
company plan
• 4th step:
company
alignment and
dashboards
• 2nd step:
understanding
the root cause
• 1st step: data
integrity
Learn Understand
ActMonitor

18. Lessons Learned
• CEO2: “in G-d we believe, in data we trust”
• CEO1: Once the data is there and clear to
everyone, you can’t avoid the action plan
• Once improvement was met, its not there to stay
unless it is part of a system and DNA

19. Q&A