FEATURE

Scaling up XaaS
Transforming your business to market, sell, and transact
as-a-service offerings
Jagjeet Gill, Deepak Sharma, and Anne Kwan

PART OF A DELOITTE SERIES ON DIGITAL INDUSTRIAL TRANSFORMATION

Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

Shifting to as-a-service offerings can drive new value creation for digital
industrial transformation—but can also potentially complicate those efforts.
This article, sixth in a series, discusses how to align XaaS with transformation.

Introduction accomplishment—it is time to fuel the

transformation engine and put in place the people,
Is your company shifting its offering portfolio processes, and technologies to scale with XaaS in
toward anything-as-a-service (XaaS)? If yes, are the market (see figure 1).
you prepared to transform your business
capabilities to market, sell, deliver, support, and Getting the execution right is critical for an XaaS
manage these types of offerings at scale? Once you transformation. A transformation strategy, as
have undergone the process of defining your explained in our previous article on how to set a
strategic guardrails, business model, capabilities, digital transformation north star,1 becomes
and operating model requirements—no small meaningless if the organization fails to carry it out

FIGURE 1

Digital industrial transformation framework

Digital industrial transformation begins with strategy, which is carried through to redesigning
talent models, transforming processes, and retooling technology. Leaders screen each decision
to confirm that it will contribute to agility, promote digital adoption, and deliver value to
customers.

4. How should capabilities be

2. Where do you configured? Where should they
choose to play, and be executed? Who has
how will you win? ownership and decision rights?

DIGITAL
ADOPTION

Business Operating
model model

Strategy Capabilities People, process,

and technology

AGILE CUSTOMER
MINDSET SUCCESS

1. What is your 3. What capabilities 5. What business

winning aspiration? are needed to processes, technology,
win? Which are new and management
versus existing? systems are required
to win?

Source: Deloitte analysis.

Deloitte Insights | deloitte.com/insights

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 Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

with intention, urgency, and commitment. Many defining what processes and automation are
companies struggle with decisive execution given necessary. In our recent article on digital
the unique complexities of XaaS transformations transformation as a path to growth,4 we discuss
that proliferate in this phase of the digital industrial how HPE built a robust partner ecosystem as
transformation journey. These complexities make part of its digital transformation in order to
companies less than optimally prepared to round out its own capabilities. These new
overcome operational inertia. In a recent study, partner ecosystems introduce ways of working
only 20.7 percent of manufacturing executives and transactional complexities that all players
rated their companies as “highly prepared” to must learn to navigate.
address the emerging business models that the
Fourth Industrial Revolution demands.2 • Significance of customer value: Leaders should
look to redefine customer relationships to place
customers at the center of innovation. In our
Inside XaaS transformation article on setting a transformation north star,5
we talk further about how to address the
What is driving this complexity—and the common daunting task of setting a transformation vision
sentiment of feeling unprepared? Based on our and specifically about how evolving customer
experience working directly with industrial expectations may be at the heart of a company’s
technology companies in transformation settings, imperative to change.
there are five main characteristics of XaaS
transformations that must be addressed for • New synergies: By establishing partnerships
successful execution. between product development and back-office
functions, organizations can enable new
• Diverse solution components: XaaS solutions synergies to accelerate XaaS offers’ time-to-
combine hardware, software, and services— market for diverse customer segments. Our
traditionally sold separately—into a single article on architecting an operating model6
customer offering. Industrial companies may provides insight into designing operating models
think of this as marrying digital information to that break down functional silos to enable these
the physical act of manufacturing. As we discuss types of synergies across the business.
in this series’ first article, value is migrating
3

away from the physical and more toward the

data and insights generated from a combination Getting started
of the physical, software, and services.
By definition, transformation efforts are a process
• Intricate dependencies: In our first article, we rather than a discrete project seeking one-time
also explain how standing up a digital industrial incremental improvements. They represent an
operation involves fundamental shifts across all iterative and dynamic execution journey focused
aspects of a business. The businesswide nature on continuous improvement and feedback loops.
of these transformations highlights the
dependencies that exist across the transactional Many companies look to improve and streamline
value chain, making timelines and dependency their current processes before moving to introduce
management critical for execution success. large-scale innovation. A recent Deloitte study7
found that the desire to improve current processes
• External ecosystems: Suppliers and channel is a more significant driver of digital
partners play an increasingly important role in transformations than the desire to innovate (see

3
Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

figure 2). The momentum gained from starting • It enables an organization to quickly deploy the
with improve can be a powerful lead-in to innovate minimum viable operational capabilities
down the road. necessary to begin transacting new XaaS offers.

Figure 3 offers a visual depiction of the journey • It enables an organization to act in an agile
that we propose companies go through to manner—to iterate and adjust based
successfully execute XaaS transformations. The on learnings.
concept of crawl, walk, run, fly illustrates how
companies gain momentum during the journey via • It allows an organization to implement a strong
iterative design testing. business process and policy foundation (for an
extended transformation effort) before making
The benefits of steadily progressing along this large technology architecture decisions.
digital maturity curve are multifold:

FIGURE 2

Digital transformation is more likely to be driven by the desire to improve

current processes than by the desire for innovation
What are the top factors driving digital transformation initiatives within your organization?

Productivity goals (e.g., improved efficiency) 50%

Operational goals (e.g., reduced risk) 47%

Customer requirements 36%

Internal strategy focus 29%

Competitive pressures 29%

Increased desire for innovation 23%

Employee demand 19%

Shareholder engagement/demand 19%

Supplier requirements 19%

Partner requirements 15%

Regulatory pressure 13%

Note: Respondents were asked to select up to three factors as driving digital transformation initiatives.
Source: Deloitte Industry 4.0 investment survey, 2018.
Deloitte Insights | deloitte.com/insights

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 Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

FIGURE 3

Crawl, walk, run, fly execution methodology

for new business models

Organizational readiness

Ad-hoc/nonstandard Foundational Advanced processes, Optimized enablers to

processess and highly processes well-defined resources, and support end-to-end
manual execution and selectively automated systems automation digital transactions

Time
Source: Deloitte analysis.
Deloitte Insights | deloitte.com/insights

• It minimizes throwaway work and helps The maturity phases

manage operational spending effectively during
a digital transformation journey. Each phase of this journey presents unique
challenges and opportunities. Figure 4 summarizes
Based on our work in this field, we estimate that the four maturity phases and companies’ typical
most organizations take three to five years to move behavior in each phase across the dimensions of
from the crawl to the fly phase and complete their XaaS offering maturity, organizational readiness,
transformation to an XaaS business. This timeline transformation priorities, people, process, and
depends upon factors such as the complexity of technology.
XaaS offerings, company size, appetite for change,
and XaaS revenue growth projections. For example, CRAWL PHASE: ASSESS OPERATIONAL
Adobe’s transformation to cloud-based subscription GAPS TO TRANSACT XAAS OFFERINGS
models took approximately five years. The When a company’s transformation journey is in the
company’s legacy business model relied on offering crawl phase, funding and budgeting conversations
customers’ physical products on a perpetual license, are prevalent, since leaders are focused on proving
but it struggled to either attract incremental the ROI and market adoption of the new XaaS
customers or compel existing customers to upgrade. offerings. Characteristics of companies operating
In 2012, leaders made their transformation efforts in the crawl phase:
official by announcing the release of the
subscription-based Creative Cloud.8 By 2017, Adobe XaaS offering maturity. XaaS offerings have
had transitioned to a software-as-a-service (SaaS) just been launched (low sales revenue); portfolio is
business model, with around 95 percent of all small (one or two offerings) with limited routes-to-
Creative Cloud revenue coming from subscriptions. market/geographies.

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Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

FIGURE 4

XaaS maturity phases

CRAWL WALK RUN FLY

Small: One or two Small: One or two Medium: Two or more Large: Five or more
Size of offerings (newly offerings; robust XaaS offerings; proven XaaS offerings; majority of
portfolio launched); light XaaS sales pipeline sales revenue revenue is XaaS
sales pipeline

Routes to
XaaS offering market
Limited Limited Multiple All viable RTMS

maturity
Geographies Limited Limited Multiple Global reach

Low: Organization and Low–medium: Clear Medium: One to two High: Three or more
Change employees have no XaaS mandates years operating as an years operating as an
management experience with XaaS understood but actions XaaS business; majority XaaS business; most
Organizational adoption
business models and behaviors have not
adapted
of employees have
adopted change
employees champion
change
readiness
• Define/validate XaaS • Define foundational • Refine processes • Address scaling
strategy processes • Implement systems complexities
Primary focus • Assess capabilities • Selective automation architecture at scale • Adopt next-generation

Transformation areas
• Define execution plan • Document standard
• Secure funding operating procedures
• Test and iterate capabilities

priorities • Launch transformation • Establish business

policies

Not aligned to new Siloed pockets of Talent levels are Talent levels and
Skill sets and business models knowledge elevated across all retention are elevated;
functions talent profiles and
talent
People incentives are aligned
with XaaS selling

Degree of Minimal Documented for 100% for all 100% for all
documentation; foundational processes process areas process areas
documentation executed ad hoc (e.g., CPQ, billing)

Process Degree of
standardization
Nonstandard (highly
customized)
Standardized for
foundational
80% across the
enterprise
100% across the
enterprise
processes

Highly manual (based Selective Highly Highly

Degree of on spreadsheets) automation via automated automated
configuration of
automation
Technology existing/new
systems

Source: Deloitte analysis.

Deloitte Insights | deloitte.com/insights

Organizational readiness. Change Process. Processes for transacting XaaS are

management adoption is low, characteristic of neither documented nor standardized (instead
companies early in the transformation journey. An highly customized on a deal-by-deal basis).
organizational mindset shift is necessary for
employees to understand and embrace XaaS Technology. Highly manual execution based
offerings and their impact on how business on spreadsheets.
is transacted.
Transformation priorities
People. Existing skill sets and talent may not be
aligned to new business models. • Validate the transformation strategy. Align the
executive team on the strategic objectives for

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 Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

the XaaS transformation—for instance, revenue tools). Leverage that case to secure
and profit aspirations, business model transformation funding from leadership.
archetype enablement, and external branding.
• Launch the transformation program. Activate
• Conduct a capability gap analysis. At this stage, a transformation management office with
it is important for companies to identify their dedicated resources to execute a road map
capability maturity gaps. For example, many through the crawl, walk, run, and fly phases.
companies need to modify their invoicing
capability to accommodate XaaS invoices, which WALK PHASE: BUILD A STRONG
are recurring and based on usage data rather BUSINESS PROCESS AND
than fixed prices, similar to how utilities such as POLICY FOUNDATION FOCUSED
electric companies invoice customers on their ON STANDARDIZATION AND
monthly usage. Organizations that are new to SIMPLIFICATION
selling in this business model often find Companies operating in the walk phase have
themselves processing XaaS invoices manually ignited their transformation journey and are
due to a shortage of automated processes and beginning to make investments in process
tools. Usage-based invoicing requires metering improvement. Characteristics of these companies:
and rating tools that can track usage and
translate it into invoices based on relevant XaaS offering maturity. Active pipeline for new
metrics and rates. Maturing this capability and business models in limited markets.
closing the gap will require new tools, automated
processes, and training talent to use both. Organizational readiness. Low to medium.
Companies have clear XaaS

Many companies need to modify transformation mandates and

revenue targets that are well
their invoicing capability to understood, but day-to-day actions
and behaviors remain unchanged.
accomodate XaaS invoices, which are
reurring and based on usage data People. Select employees involved
in transformation efforts to
rather than fixed prices. develop siloed knowledge of the
new business model. The rest of
• Create an execution roadmap. Create a clear the organization still needs to be brought along on
map of what the organization needs to do the journey; significant talent upskilling is needed.
(informed by the capability gap analysis) to
create an informed and targeted path for Process. Foundational processes are documented,
innovation. Focus more on go-to-market standardized, and optimized for XaaS business
capabilities, such as pricing, marketing, and models. Figure 5 shows priority areas across the
sales in the first few quarters to establish a XaaS transactional value chain.
XaaS brand in the marketplace.
Technology. Selective automation via
• Secure funding. Develop an investment case for configuration of existing systems. Priority areas for
total cost of the entire transformation, factoring automation include offering configuration, pricing,
in both labor and licensing costs (for any new quoting, billing, invoicing, and revenue recognition.

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Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

FIGURE 5

XaaS transactional value chain

Pricing frameworks: Enablement of usage-based, value-based,

Lead to opportunity and asset-based scenarios
Pricing standardization: Standardization of pricing and
discounting thresholds, offering bundles and global deal approval
Opportunity to quote processes to reduce deal cycle time

Quote to order Contract and quote simplification: Standardization and

simplification of XaaS contracts to improve customer experience
and capitalize on operational efficiencies
Order to fulfill

Usage-based billing: Enablement of flexible billing that is based

Bill to invoice on how much a customer uses a service

Invoice to
Invoice revenue
to cash
Revenue
to report

Manage to support

Streamlined support processes: Simplification of customer

Issue to resolution experience by ensuring “only one number to call” for support vs.
separate numbers for product and services support

Source: Deloitte analysis.

Deloitte Insights | deloitte.com/insights

Transformation priorities • Document standard operating procedures.

Leverage the newly defined processes to
• Develop foundational processes. Document document SOPs to establish handoffs across
new processes that are simplified and functions and process phases.
standardized across the organization to enable
XaaS transactions. • Establish business policies. Make clear policy
decisions about how to do business with XaaS
• Make automation decisions. Decide what will for areas such as billing (How will we capture
be automated in this phase; design and bill on usage?) and sales (Which sales roles
standardized and simplified process flows to will be selling these offerings, and how will they
reflect selectively automated capabilities. be compensated?).

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 Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

IN PRACTICE: STRIVING FOR WALK WHILE PLANNING FOR RUN AND FLY
One of our clients was launching new IoT/XaaS solutions and had set bold volume and revenue
targets for the next fiscal year. We helped the client identify 32 process “breakpoints” across the
end-to-end value chain, representing obstacles in legacy processes that prevented the company
from transacting XaaS offerings at projected volumes. Leaders wanted to strive for walk (with
a strong process/policy foundation and only selective automation of existing systems) before
the commencement of the next fiscal year. We referred to leaders’ goals as a proof-of-concept
foundation for their transformation ambitions that could be scaled to run and fly phases in
the future.

To achieve the proof-of-concept ambitions, the organization focused on process standardization

and optimization across the value chain to address the key breakpoints for areas such as sales
incentives and enablement, customer contract management, CPQ standardization, usage-based
billing, revenue recognition, and customer success. Some configuration work was done in existing
systems for areas such as lead and opportunity tracking, contract repository and authoring, quote
and proposal generation, and order fulfillment. The client stitched together new processes and
systems end-to-end as part of operational readiness efforts to test and validate the combination of
manual and automated steps.

Outcomes included:

• Reduced contract lengths from 100-plus to 11 pages

• Achieved a one-line quote (reflecting single price for hardware plus software plus services) that
could be created in under 10 minutes (previously took weeks to months)

• Adopted a “one quote, one order” policy and streamlined accounting and reporting

• Activated a recurring billing process and semiautomated invoice generation process

• Streamlined support processes to simplify the customer experience

• Introduced minimum commit billing policies to ensure predictable cash and revenue recognition

• Documented revenue recognition policies to ensure compliance with regulations around XaaS and
recurring revenue business models

Leaders are planning efforts to achieve run status and are confident that the process standardization
work completed in the walk phase will serve as an accelerator to their transformation objectives.

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Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

IN PRACTICE: TRANSITIONING TO WALK WHILE MINIMIZING DISRUPTION

Another client, a large security software company, was looking to efficiently deliver security-as-a-
service offerings while addressing declining revenues and overcoming a history of transformation
failures. This new transformation had to be undertaken in a very complex environment—hundreds
of products and services and more than 8 million price points. We aimed for a smooth, lean
transition to the walk phase that minimized organizational disruption.

As a first step, the focus was on designing a simplified, digitally enabled customer experience for B2C
customers in the cloud route-to-market, followed by the design of end-to-end capabilities, policies,
processes, and systems required to enable that experience. The process design work was founded
on the principles of simplification and standardization, resulting in a lean set of processes that could
be automated into a more streamlined system architecture.

The architecture design was heavily focused on automating the quote-to-cash process area
demanding choice points around:

• Flexible billing systems to automate quoting, billing, order management, and subscription
management capabilities

• Common cloud platforms to streamline customer touchpoints, enable customer trials, and speed
up provisioning time with the SaaS offering portfolio

• Enterprise integrations with existing ERP and CRM solutions to ensure optimized and automated
data flows across the organization

Because of these efforts, the digital customer experience was simplified and operating costs
for quote-to-revenue were reduced by 99 percent. This work served as a launching pad for the
organization’s full E2E transformation to the run phase—and additional routes-to-market.

RUN PHASE: INVEST IN AUTOMATION People. Majority of the business is trained on the
TO ACHIEVE LONG-TERM RESULTS new business model; talent levels are elevated
Companies operating in the run phase of their across all enterprise functions.
journey are operating as mature digital
organizations with advanced/automated Process. Processes have been documented,
capabilities for transacting XaaS. Characteristics of simplified, refined, and automated across all
companies operating in the run phase: process areas, applied consistently to XaaS deals.

XaaS offering maturity. Healthy XaaS business Technology. Full systems automation is enabled
revenue from two or more XaaS offerings across via an interconnected digital business architecture.
multiple routes-to-market/geographies. There is little to no manual touch involved in end-
to-end (E2E) XaaS transactions.
Organizational readiness. Typically, one to two
years operating as a digital XaaS business. The Transformation priorities
organization has shifted mindset to embrace and
understand new business models, with most • Refine processes. Update processes to add the
employees adopting the change in their day-to- advanced capabilities necessary to enable
day routines. complex XaaS offerings and reflect new
automation for XaaS transactions.

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 Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

IN PRACTICE: EMBRACING DISRUPTION

A US$2 billion software and hardware company was executing its transformation agenda to achieve
run maturity. The company had just launched its first XaaS product and was striving for rapid market
growth. Leaders quickly realized that their existing business and technical capabilities could not
deliver the new business model at scale.

The company took the approach of moving quickly from crawl to run by choosing to make large
systems automation investments early in its transformation journey. The firm had the agility and
investment means to make this transformation leap.

As a first step, leaders defined a target business architecture for XaaS enablement. This architecture
included plans for the implementation of a new subscription billing platform, customer account
management console, and usage mediation platform.

The company is currently leveraging agile development methodologies for systems activation and
addressing process improvement in parallel. The implementation phase is still ongoing, but leaders
are seeing early outcomes with improved customer experiences and reduced operational costs.

Making the leap from crawl to run is challenging, but it can be done if leaders are ready and willing
to embrace the associated risks and disruptive organizational change.

• Implement a systems architecture. Adopt a People. Talent levels and retention of high-
digital business architecture through E2E potential employees are elevated across the
systems automation. enterprise. Talent profiles and incentives are
aligned with XaaS selling.
• Test and iterate. Continue to test and refine
new capabilities based on customer and Process. Processes are highly advanced, and
employee feedback. 100 percent documented and standardized across
the enterprise.
FLY PHASE: CONTINUOUSLY REFINE THE
DIGITAL MODEL Technology. A sophisticated systems architecture
Companies operating in the fly phase are making is enabled to transact digital offerings.
bold investments to drive disruption.
Characteristics of such companies: Transformation priorities

XaaS offering maturity. Global reach, with a • Address scaling complexities. Tackle the
large and sophisticated XaaS portfolio that is complexities that come with scaling and
available for all viable ready-to-market products. maturing XaaS business, such as driving
consistency across capabilities.
Organizational readiness. More than three
years operating as a digital business. All employees • Adopt next-generation capabilities. Optimize
embrace the XaaS business model and champion enablers such as artificial intelligence and
the change that the business model shift has driven. machine learning to infuse analytics in offerings
and E2E operations. Leverage blockchain to
drive transactional integrity.

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Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

IN PRACTICE: CUSTOMER-CENTRICITY
Salesforce is an example of a company born in an XaaS model. Leaders built the business on the
premise of XaaS, enabling the company to achieve rapid digital maturity and redefine what it means
to fly as a result of continuous modernization.

Salesforce is a services-oriented organization that places the customer at the center of its strategic
choices, with the overarching goal of making customers more efficient and productive. One of the
company’s three strategic growth levers is “speaking the language of the customer,” enabling it to
form deep and value-driven customer relationships.

The customer success team plays a significant role in building these relationships by providing
prescriptive, data-driven business advice to help maximize customer value on a continuous basis.
The team also continues to adapt to customer demands and market innovation by ramping up R&D
investments in Einstein AI, analytics, mobile, Quip, communities, and IoT services.

In a recent earnings call, Marc Benioff attributed the success of the born-XaaS model to the
company’s customer focus: “Every CEO is thinking about their digital transformation. And, every
digital transformation begins and ends with the customer … We’re the No. 1 customer company
in the world. No other company in the history of the software industry has been as focused on
customer relationship management.”9

Lessons learned from XaaS decisions going forward. It also enables

transformation execution organizations to embrace the shift to new
business models and build the muscles required
Reflecting on experiences and case studies, there to run and fly with XaaS.
are core lessons that are important to keep in mind
for executing an XaaS transformation: • Have defined decision-making processes. Only
29 percent of executives see their organizations
• Eliminate organizational silos. In particular, as having clearly defined decision-making
business and IT need to be able to jointly processes.11 XaaS transformations require rapid
address and manage critical dependencies. decision-making, and it is critical to have clear
According to a recent study, one-third of ownership, accountability, and processes
leaders ranked organizational silos among their defined to enable swift and firm decisions that
top three challenges in setting Industry 4.0 will move the transformation forward.
strategy. One of our clients found success in
10

eliminating functional silos by hosting monthly • Make change and communication a pillar of
“delivery acceleration” sessions to bring together the transformation. An effective communication
cross-functional stakeholders for rapid capability can enable an organization to adopt
decision-making. changes quickly by ensuring that stakeholders
embrace the responsibilities of their role, have
• Leverage the walk phase for foundational clear expectations in terms of impact to their
investments. This is the phase that allows day jobs, and feel strongly supported by
organizations to build a strong process their leadership.
foundation based on simplification and
standardization. It gives leaders time to test • Keep the end goal in mind. Don’t lose sight of
these processes and make the right system what fly means to an organization, so that it is

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 Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

clear what the organization is trying to organization. Cisco CEO Chuck Robbins
accomplish at each phase of the journey. recently articulated the importance of pulling
partners into the XaaS journey: “As we make
• Enforce top-down leadership commitment. It is this transition to more SaaS and software
critical for leaders to be engaged in the trans- subscription offers, I’ve told [our teams] I don’t
formation and involved in key decision-making. know how you are going to do it, but you’re
Ensure that leaders have clear roles in the going to do it with our partners.”12
transformation and are committed to catalyzing
the transformation through change manage-
ment, communication, and decision-making. Conclusion

• Put the right people with the right skills in the Launching a successful XaaS transformation
right roles. Ensure that your key stakeholders begins with having a clear understanding of
have the right skills, mindset, and influence to capabilities, gaps/breakpoints, and aptitude for
drive rapid organizational change and change. This understanding will determine the
proactively anticipate dependencies, risks, path of the execution journey—and how quickly
and issues. and adeptly an organization navigates the crawl,
walk, run, fly curve to XaaS digital maturity.
• Take your customers, employees, partners, and
suppliers along on this journey. Ensure that In the next article, we will talk more about the
these stakeholders have a voice and play a key specific challenges and complexities faced when
role in the transformation. Your XaaS business transforming the quote-to-cash process for XaaS
cannot thrive without their commitment to your models.

Endnotes
1. Maximilian Schroeck, Anne Kwan, and Jon Kawamura, Setting the north star: Staying focused and on track,
Deloitte Insights, July 2, 2019.

2. Paul Wellener, Heather Ashton Manolian, and Stephen Laaper, Distinctive traits of digital frontrunners in
manufacturing: Embracing the Fourth Industrial Revolution, Deloitte Insights, August 23, 2018.

3. Maximilian Schroeck et al., Digital industrial transformation: Reinventing to win in Industry 4.0, Deloitte Insights,
June 17, 2019.

4. Maximilian Schroeck, Anne Kwan, and Jon Kawamura, Digital transformation as a path to growth: Capturing new
market opportunity, Deloitte Insights, July 15, 2019.

5. Schroeck, Kwan, and Kawamura, Setting the north star.

6. Anne Kwan, Maximilian Schroeck, and Jon Kawamura, Architecting an operating model: A platform for accelerating
digital transformation, Deloitte Insights, August 5, 2019.

7. Andy Daecher and Brenna Sniderman, The innovation paradox: A balance between optimization and uncharted
waters, Deloitte Insights, October 10, 2018.

8. Adobe, ”Adobe investor presentation,” July 2018.

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Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

9. Bob Evans, “Why Salesforce is soaring in the cloud: 20 eye-popping numbers,” Forbes, March 5, 2018.

10. Kwan, Schroeck, and Kawamura, Architecting an operating model.

11. Punit Renjen, “How leaders are navigating the Fourth Industrial Revolution: Our latest survey of Industry 4.0
readiness,” Deloitte Review 24, January 20, 2019.

12. Matt Brown, “Chuck Robbins’ five bold statements on Cisco’s software revolution,” CRN, August 16, 2018.

Acknowledgments
The authors would like to thank Molly Campbell for her research and dedication to bringing this
article to life. The authors would like to recognize Maximilian Schroeck, Jon Kawamura, Cristina
Stefanita, and Divy Jain of Deloitte Consulting LLP for their contributions to the Digital
Transformation practice.

About the authors

Jagjeet Gill | [email protected]

Jagjeet Gill is a principal in the Strategy practice with more than 17 years of global consulting
experience advising technology sector clients on large-scale IT-enabled business transformation and
restructuring efforts. He has significant experience in advising clients on XaaS business model
transformation, IT strategy and transformation, enterprise architecture, IT cost effectiveness, agile
transformation, and transformation program management. Gill is based in San Jose, California;
connect with him on LinkedIn at www.linkedin.com/in/jagjeetgill/.

Deepak Sharma | [email protected]

Deepak Sharma is a leader in Deloitte’s Customer and Marketing Strategy practice. He is focused on
customer-centric digital transformations. Sharma works with and advises chief customer officers,
heads of customer success, and support executives in defining and executing innovative strategies to
maximize value creation for their customers. Sharma is based in San Francisco and is on LinkedIn at
www.linkedin.com/in/deepaksharma/.

Anne Kwan | [email protected]

Anne Kwan is a leader in Deloitte’s Technology, Media & Telecommunications practice. She advises
clients evolving their growth strategies with new flexible consumption/as-a-service business models;
recent engagements include the design and launch of new IoT businesses. Kwan has more than 18
years of technology industry and management consulting experience. She is based in San Francisco.
Connect with her on LinkedIn at www.linkedin.com/in/annekwan/.

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 Scaling up XaaS: Transforming your business to market, sell, and transact as-a-service offerings

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Jagjeet Gill
Principal | Deloitte Consulting LLP
+1 408 704 4148 | [email protected]

Jagjeet Gill is a principal in the Strategy practice with more than 15 years of global consulting
experience advising technology-sector clients on large-scale IT-enabled business transformation and
restructuring efforts.

Deepak Sharma
Managing director | Deloitte Consulting LLP
+1 408 666 6723 | [email protected]

Deepak Sharma is a leader in Deloitte’s Customer and Marketing Strategy practice.

Anne Kwan
Managing director | Deloitte Consulting LLP
+1 415 783 6379 | [email protected]

Anne Kwan is a leader in Deloitte’s Technology, Media & Telecommunications practice.

Deloitte Consulting LLP’s Digital Transformation practice has advised clients in the technology
sector (e.g., hardware and software) as well as those in the industrial sector (e.g., manufacturing,
construction, and energy) on how to enter and compete in new growth areas. Our work includes
defining customer-first strategies, building new business and operating models, and launching
the critical capabilities required to swiftly drive scale—all to achieve optimal results from limited
resource pools. Contact the authors for more information.

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