Balanced scorecard example for a field service software company

Annual recurring revenue is $82 million from 6,400 contractors, up 19% in a year, down from 34% two years ago. Net revenue retention is 98% and gross revenue retention 86%, so new sales mostly replace what leaves. Free cash flow margin is -9%. A quarter of churned revenue comes from customers in their first year, who take a median 74 days to go live. Availability was 99.82% over the last twelve months, with nine severity 1 incidents, six of them between June and August when contractors are busiest. Releases ship every two weeks and 18% need a rollback or hotfix. Voluntary attrition among our 190 engineers is 24%.

• Customers leave faster than they expand. Each point of gross retention lost is $820,000 of recurring revenue that sales must replace, at a customer acquisition payback of 26 months.
• Outages cluster in the summer peak, when a dispatcher who cannot open the schedule sends technicians out blind. Large two-week releases and a dispatch core that few engineers understand are the cause.
• The engineers who can fix this are the ones leaving. On-call rests on 22 people, who were paged out of hours an average of 11 times per on-call week last year.

• Paid, lighter on-call and a wider group who know the dispatch core cut engineer attrition, which keeps the people able to break the two-week release into daily deployments.
• Small daily deployments fail less often and are quicker to reverse, so severity 1 incidents become rarer and shorter and availability rises to 99.95%.
• A system that stays up from June to August removes the reason most often given for canceling, which lifts gross revenue retention.
• Standard configurations by trade and certified implementation staff cut go-live from 74 to 35 days, so fewer first-year customers leave before they have invoiced a job.
• Customers who are live and stable adopt payments and maintenance-plan billing, which moves net revenue retention above 100%.
• With higher retention, each dollar of sales spending adds to recurring revenue instead of replacing it, which is what turns free cash flow positive.

• Sell payments and maintenance-plan billing as add-on modules with usage tiers
• Move account managers' variable pay from new bookings to net retention of their book
• Cut cloud spending per customer by 25% with reserved capacity and by retiring the legacy reporting cluster
• Hold sales and marketing spending flat and shift 15% of it to customer marketing

• Publish a status page with live availability and a written review after every severity 1 incident
• Run a pre-season health check with the 800 largest customers each April
• Give every customer above $20,000 in annual contract value a named onboarding lead
• Call every new customer that has not invoiced a job by day 30

• Separate the dispatch core from billing and reporting so each can be deployed on its own
• Put every change behind a feature flag with automated canary checks and one-step rollback
• Load test at twice the previous July peak every spring
• Build standard configurations for heating, plumbing and electrical to cut specialist hours per go-live from 31 to 14

• Pay for on-call and give a day off after any night with more than two pages
• Rotate six engineers a quarter through the dispatch core team, each paired with a mentor
• Open a staff engineer track so senior people can progress without managing
• Certify implementation and support staff on payments and each trade configuration