Dispelling A Myth About Subscription Licencing For RFP Software

As a panellist for the Technology in Bidding & Buying discussion at last month’s APMP UK conference, I was presented with many interesting questions from fellow bid and proposal professionals. Of particular note was this question regarding subscription licencing for proposal automation technology…

“Some vendors use subscription licensing models. This discourages collaboration and often limits usage to central bid teams. How are vendors addressing this?”

At Upland Qvidian, we’ve discovered that our happiest clients are those who focus on collaboration – they’re free to devote more time addressing strategic challenges and spend less time distracted by operational concerns. For example, learn more about how to get subject matter experts on board and improve collaboration here. The shift to subscription licensing is symptomatic of two things:

• firms looking to reap the financial and business benefits of investing in operating expenses rather than capital expenditures (OPEX vs. CAPEX).

• the rise of the Software-as-a-Service (SaaS) model and its advantages over the perpetual licencing model that, until relatively recently, dominated the software industry.

For the customer, a SaaS subscription represents a shrewd move away from capital-heavy software investments and eliminates annual fees for support, maintenance and software upgrades. That’s not to say that there are no recurring costs, however, SaaS offers greater flexibility in increasing or reducing licences – scale on demand – while the burden of availability, performance, security and operational overhead is transferred to the SaaS vendor.

Perhaps the biggest boon for the customer is flexibility. SaaS subscriptions make it far easier for customers to vote with their feet than under the traditional perpetual licence model. This makes it more important than ever for vendors to deliver on their promises, and exceed customer expectations.

With 400 delegates in attendance this year, the APMP UK annual conference is the premier event for bid and proposal professionals who are serious about advancing their knowledge and skills

For the vendor, the SaaS model empowers product development teams to deliver a richer, concentrated set of features and functions that are centred solely around customer success. Greater vendor innovation, rapid response to customer requests and a richer product roadmap are all made possible through a powerful combination of SaaS and iterative Agile development methods.

So, in the right business case, rather than being prohibitive, in my experience the SaaS subscription model broadens collaboration. Vendors are addressing concerns about user access and purchasing the right number of licenses in at least three ways:

Supporting a larger business case in subscription licencing for RFP software

Most vendors don’t want to have pricing conversations. They want to talk value—and that is the discussion bid and proposal teams must have when petitioning budget-holders for backing. Often, linking the investment to a hot strategic objective or a funded project that is already underway can help to justify the purchase. I work with organisations to help them have those types of conversations with key stakeholders and business principals within their organisations.

Allowing non-licenced users to participate in collaboration

Some vendors have developed lower-cost subscription licencing for RFP software (SaaS licenses) that offer reduced functionality to users who only ever need access to small portion of the application. The goal? To ensure that the people involved in the bid and proposal process have access to the information they need, when they need it. Involving colleagues outside the core proposal team in the process is crucial for high-quality proposals—vendors recognise that they need to support these users, who have unique needs and differing priorities.

Focussing on value as the principal driver for pricing

Vendors don’t want to have pricing conversations. Sound familiar? So, it is incumbent upon vendors to differentiate themselves on value – by understanding the market’s perception of value and what constitutes a good return on investment. This requires vendors to really identify with the needs and desired outcomes of customers across a spectrum of day-to-day operations, tactical concerns and strategic imperatives. In my experience, authentic customer-centricity and empathy are very powerful discriminators – and extremely valuable!