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Did the Rule of 78 Doom Your 2021 SaaS Revenue Plan?

Did the Rule of 78 Doom Your 2021 SaaS Revenue Plan?

In SaaS businesses, the Rule of 78 is used to plan how much revenue is needed each month to achieve a certain target. Accounting standards require that revenue be recognized ratably over time. This makes it hard to hit an annual goal when you have underperformance in the early part of a year. You simply can’t make up for lost time. Product managers should first quantify what has happened, understand why it happened, and use short and long-term tactics to achieve annual SaaS product revenue goals.