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Zuora Helps Siemens Transition to Subscriptions for Cloud-Based Medical Products

With Zuora Revenue and Zuora Billing, Siemens Healthineers automates and reduces the number of manual processes for managing subscriptions by more than 60%

Zuora Inc., the leading cloud-based subscription management platform provider, announced that it is helping Siemens Healthineers AG (SHL.DE), a leading medical technology company with over 120 years of experience and 18,500 patents globally, introduce new recurring revenue streams from its Digital Health Solutions Portfolio using Zuora Billing and Zuora Revenue.

The advent of cloud-based data management and artificial intelligence (AI) have enabled advancements in medical technology that are increasing operational efficiency while improving patient outcomes. Siemens Healthineers has been at the forefront of this trend. The company has introduced digital health offerings like the teamplay digital health platform, which enables healthcare providers’ digital transformation; AI RAD Companion, an AI-supported, cloud-based image interpretation tool; and AI-Pathway Companion, an AI-based software facilitating personalized and standardized diagnosis and treatment decisions.

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While these new products were successful with customers, they posed challenges for the company’s finance and IT functions. The subscription model is characterized by smaller payments, a need for pricing adaptation, varying volumes, frequent changes, and distinctive accounting rules. As a result, the entire order-to-revenue process, with its complementary back-office processes, differs substantially from those for a transactional business model. Siemens Healthineers’ traditional sales approach for hardware and software needed to be tuned for new and dynamic digital offerings; the company needed the ability to support new recurring revenue models across multiple customer touch points for a seamless end-to-end subscription experience.

“We needed to move from transactional to recurring for many parts of our digital portfolio,” explained Rahma Samow, Head of Siemens Healthineers Digital Health Global Sales, Marketing and Digital Go-to-Market. “For an expanding range of digital offerings, more and more customers are buying into the idea of continually experiencing new functionalities, new features, new capabilities, and specifically, enhanced added value over time.”

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Florian Rachny, Head of Digital Business Processes, Siemens Healthineers added, “But, we needed technical support for IT to drive this transformation.”

Siemens Healthineers added Zuora Billing and Zuora Revenue to the company’s IT stack. Zuora now powers back-office processes like tax calculation, accounting, invoicing, and license management. Zuora also helped the company institute new leading KPIs, such as the number of active users, premium conversion rates, and churn rates.

For some parts of its portfolio, Siemens Healthineers has also begun the transition from simple cost-plus pricing to pricing based on delivered value. “For example, the AI-Rad Companion is priced based on productivity savings and quality improvements in customer settings,” said Rahma Samow.

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Automating the order-to-revenue process with Zuora has enabled Siemens Healthineers to reduce the number of manual processes by more than 60% and become more agile by shortening the processing time by about 75% for their subscription management.

Perhaps just as important as pricing flexibility and efficiency gains from automation has been Zuora’s unique expertise on the cultural shift to subscriptions. “Zuora has given us both technical and strategic capabilities to achieve our long-term goal of running a successful subscription model in the backend,” said Rachny.

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