Performance Measurement and Management for Recurring Revenue Models
- Based on the importance of contingency-based performance management and the increasing popularity of the recurring revenue model in recent years, this paper investigates contingency-based and context-specific performance measures appropriate for businesses operating with a recurring revenue model. By employing a case study approach the phenomenon was investigated in the real-life setting of a company operating a recurring revenue model, leading to the research suggesting that appropriately shifting focus with regards to performance measurement and management and adapting the system to key contextual variables to adequately measure and manage the recurring revenue model can ultimately lead to more effective and efficient performance management. The research therefore constitutes a contribution to contingency research and extends the realm of existing recurring revenue research in that the study provides a comprehensive summary of recommendations detailing measures and practices to be applied to performance measurement and management for recurring revenue models in order to outbalance the inability of traditional performance measures to provide sufficient insights about the key factors relevant to the success of the model. The results are intended to be informative for companies operating with a recurring revenue model, rather than uniformly transferrable, as they require adjustment to company-specific contextual variables.