In 2020, our humble homes became the essential support beam for both human health and business continuity, something that wouldn’t have been possible without “as-a-service” applications for food delivery, physician care, day-to-day job responsibilities, and more.

By Kirk Carlsen, Oracle

The as-a-service business model certainly isn’t new. Everything from music to movies to maintenance can be delivered using a subscription model. But it’s fair to say that people value these services now more than ever, and they are an emerging opportunity for businesses looking to build new revenue streams.

In fact, many businesses are already there. In an October 2020 survey, 62% of all companies said they’ve implemented solutions to manage an increased demand for online interactions and services. And more than half of respondents (53%) believe the change will stick after the pandemic subsides, as consumers and customers settle into the “next normal”.

Introducing new revenue streams based on the as-a-service shift is one of four Big Moves that finance leaders should make to grasp opportunity and move their businesses forward.

How finance drives value in new business models

Optimising your portfolio might not be a top priority right now, but research indicates that it should be. McKinsey & Company analysis found that “companies that invest in innovation during a crisis outperform the competition on market capitalization by 10%; investing in innovation after a crisis gives them a 30-percent advantage”.

For pure product companies, the biggest opportunity is to identify offerings that are wholly new or extend the value of existing products.

Companies such as Apple, John Deere and Boeing are well known for augmenting their highly technical products with internet-delivered services for preventative maintenance, localised configurability, real-time in-field analysis, and more.

CFOs and their teams are an essential part of decision-making for new business model innovation, and making sure investments deliver on expectations is vital.

Organisations need to evaluate their most and least profitable lines of business, locations, or products, so they can shift resources as necessary. Finance professionals who use profitability and cost management solutions can help identify areas to reduce costs and uncover investment opportunities.