Guided Configuration – Key for Quick and Error-Free Configuration

Guided configuration is not a new term in the world of configurators, but with augmenting complexity of products and services, it is playing a critical role in reducing the configuration time and improving error-free quotation process.

So, what is Guided Configuration & How is it different from Guided Selling?

Guided Configuration is the mechanism of using attributes, not as adjectives to product, but as questionnaires to help sales reps reach to a configuration which is near to final. These logical and relevant set of questions help system to narrow down the configuration options and auto-include or exclude product components and set quantities based on answers.

While Guided Configuration is to narrow down product components within the configuration, Guided selling helps sales reps or customers narrowing down the product catalog. By answering guided selling questions, user gets the sub-set of product catalog, which is more relevant to the customer and has better chance of selling.

In nutshell, Guided Selling works on Product Catalog, while Guided Configuration works on underlying Product Configuration.

So, the next question is Why Guided Configuration?

In the competitive sales world, 2 critical factors to increase your sales probability are quoting time and error-free quotes. The increasing complexity of products and services imposed adverse effects on these 2 factors. Guided Configuration is a powerful, yet easy to use, technique to narrow down the configuration process, increase sales rep efficiency and helps generating error-free quotes. The logical and relevant questions ensure that incompatible components are excluded, while mandatory ones are auto-included. Also, if underlying CPQ system supports, it ensures that correct quantities of components are included. As example, while configuring a hosting solution, the set of questions regarding security, protocols, accessibility, backups etc can help sales reps reaching to a near final configuration in quick time.   

So, let’s consolidate the list of advantages of using Guided Configuration.

• For complex products and services, it helps quickly reaching to nearly final configuration. Which means less time for complex configurations.
• It eliminates the incompatible components and ensures addition of mandatory items. This assist in error-free quotes, from composition perspective.
• The Guided Configuration questions are assume to be simple and lucid. Which enables even the naïve sales reps and users from other channels to configure and sale effectively.
• If underlying CPQ system supports, Guided Configuration can also helps in setting correct quantities of product components.

Conclusion

With increasing complexity of products and services, along with urge for speed and error-free configuration, Guided Configuration could be an effective technique to quote faster and error-free.

Advance CPQs like Apttus, provides out of box extensive support for Guided Configuration.

Please wait for my next article on how the new Attribute Based Configuration (ABC) framework of Apttus CPQ, brings Guided Configuration to a much higher level.   

Quote to Cash – Simply Defined

Quote-to-Cash (abbreviated as Q2C or QTC) is one of the hottest topic in CRM world, especially in Cloud platforms. It has been explained and defined in multiple ways, but most of them are neither comprehensive nor lucid enough for non-techie people. Even Wikipedia has a short paragraph on it. This article is yet another effort to define Q2C in a simpler and coherent manner.

Quote to Cash, as the name suggest, is an end-to-end business process which includes steps from product modelling and all the way up to revenue recognition at the end. In between it includes:

• Product Setup – Defining products/service structures, bundles/components, configuration rules and pricing methods.
• Quote Life Cycle - Create quote, configure products, apply promotions & discounts, internal approvals and generate quote output document for customer negotiations.
• Contract Life Cycle – Create and manage contracts, negotiations and approvals.
• Order Management – Create orders and order orchestrations.
• Asset Management – Create and manage assets. Assets based ordering (change orders, terminate/renew/close assets).
• Invoicing & Billing – Generate invoices and manage cash collections.

These steps are not new and has always been part of complete sales process, but the noticeable point is that these were accomplished by independent and silo systems in enterprise landscape. As example, excel sheet could be used for quotes, a custom developed application for order management, while a renowned COTS product for billing/invoicing. But none of them were native to CRM system. Being technically and functionally disconnected, each of these applications/products needs integration to complete the process. Also, these siloed pieces bring lot of inefficiencies and delays in sales cycle and may result in wrong product configurations, erroneous quotes, incorrect orders/invoices and ultimately loss of revenue and customers.

The advent of CRM cloud platforms enabled companies to build the complete Q2C solution stack natively on CRM and overcome cons of having Q2C process as disintegrated. This provides a close integration of Q2C with CRM system, 360 degree view of the customer across functions, single source of truth for products/services, synchronization among different sales channels and many more. Let’s detail out some of the key benefits of adopting CRM native Q2C process:

1. Q2C process impacts every function of the organization including sales, finance, legal and operations. It enables all functions performing their job efficiently in the complete sales cycle and have a 360 degree view of the customer journey.
2. Automated Q2C process avoids incorrect product configurations, erroneous quotes, contract issues, order mistakes and revenue losses.
3. Speed is the most critical aspect of any sales function and Q2C helps in improving it. Quick quotes, speedy approvals and digital contracts help sales reps sell faster and improve revenue and margins.
4. Q2C process in CRM platform assist in maintaining the single source of information across sales channels. In addition to this, it provides better control over pricing and visibility of products across different channels.
5. With 360 degree view of customer, sales reps get ample opportunities for cross/up sales and customer retentions.   

In modern sales process, Q2C is becoming a de-fecto in laying the foundation for company’s margins and market presence by contributing heavily in smart and quick selling of products and services. Organizations are ready to invest in bringing their complete Q2C process on CRM platform to sell more and get competitive advantage. So, are you ready to join the stream?

Building a Strong Professional Services Team

Building a Strong Professional Services Team

The Success key for Product Companies

Recently we visited a fairly new restaurant, knowing that it has one of the best chefs of the city. But soon the experience turned out to be poor, not due to food but, due to pathetic services and presentation of the food. The waiter was not able to understand our need, what customization we wanted and how to present it. I am sure many of us get similar experiences on multiple occasions and would never recommend anyone going there. Isn't it?

The same experience your customers get if your professional services are not up to the expectations, even if you have functionally-rich, technically-sound products. Most of the product companies focus on product development and feature enhancements but forget to nurture and groom their professional services organization. This result in poor implementation, timeline issues, lack of adoption and lose of customers at the end.

Professional Services plays a key role in implementing & deploying the products, integrating it optimally in existing landscape, making it usable and ensures overall adoption. As a result you get happy and referenceable customers.  

But the question is how to build a strong PS organization? And here are few tricks to do that:

1. Involve Professional Services from inception of engagement. It helps a lot in understanding the context, customer’s need and what was promised while selling the product.
2. Empower Professional Services to own implementation estimations and deliveries.
3. Build strong PS organization – Remember PS team has the responsibility not to just successfully implement product, but to successfully deliver engagement. It requires highly motivated, qualified, experience and customer-cantered team members. Define the roles and build a strong PS team.
4. Knowledge is the key for PS success. Groom PS team to know everything about your products. Remember even a great feature is of no use, unless it is implemented in right way.
5. Take inputs and feedbacks from professional services. Every implementation brings lot of new things. Professional Services team spent most of the time with customers. They bring the real feedback for you.
6. Integrate PS with Sales and Product teams. PS should play a vital role in future product roadmap. The customization done by PS team should be taken to product council to see the possibility of fitment with product roadmap. Similarly Sales team should integrate with PS to implement learnings for new prospects. 
7. Empower Professional Services with tools and processes. Consider PS as pure service model and execute projects with processes and tools. Adopt industry standard project management methodologies and lay down processes for smooth, timely and quality deliveries.
8. Embrace reusability and knowledge sharing within PS organization. Avoid reinventing wheels with every implementation. Although try limiting the customization, but ensure that you find the right channel to feed it back to product team

Remember selling of products is important, but proper implementation and successful adoption is equally important. A strong PS team ensures that the higher quality is delivered, the product is integrated well not to be replaced easily, the users adopt the product so the organization gets happy customers.

The P of CPQ

The P of CPQ

CPQ (Configure, Price and Quote) is emerging as one of fastest growing areas in sales. It helps sales reps effectively sale products and services, reduces the overall cycle time, minimizes quote errors and brings uniformity across channels. But one of the greatest contributions of CPQ is the capability to add complex, analytical and smart pricing to improve overall margins and revenues.

This article focuses on the comprehensive pricing capabilities of every CPQ solution and is based on my personal analysis and experience with multiple CPQ solutions and research articles.

Basic Pricing Methods

• Matrix based pricing
CPQ solution should provide flexibility to define dimensions and price based on those dimensions. As example, a sales rep may need to define price or discount/markup based on combination of customer priority, country and quantity. A CPQ solution should facilitate defining multi-dimension price matrix.

• Related and Dependent Pricing
Many times the price of product/service depends on other products or services. This may be a simple relationship, for e.g. % based, or complex mathematical calculation. The related products may be in the current quote or already installed/purchased by customer a.k.a Asset based pricing. As example the price for extended warranty in the quote could depend on the price of already purchased product.

• Attribute Based Pricing
In practical situations, prices of products/services depend on the attributes selected during configuration. This is one of the most common pricing capabilities required in CPQ. As example, the price of an ECG cart varies with selection of monitors and trollies.

• Pricing Rules
CPQ solution should also allow writing logical and conditional rules to be applied at aggregate level (product family, cart etc). This can be used for volume discounting, promotions and offers.

• Contextual Pricing
Contextual pricing refer to the concept of defining the price of an item depending on how it is sold. For e.g. An Anti-virus package sold as part of complete desktop configuration will have a different price as compared to when it is sold alone.

• Hook for external or custom pricing
Many organizations have their own pricing engines or external systems to drive pricing logic. Every CPQ should support callback or hooking mechanism to either integrate with external system or write custom logic for pricing or discount.

• Support for Tiered Pricing and Price Ramps
Tiered based pricing refers to the pricing method where items are prices based on tiers rather than discrete. As example to better understand this, consider the price of Internet Service usage which varies with slots like 0-1 GB, 1-5 GB etc. On other hand, Price Ramps is the slicing of selling terms and price. For e.g. the maintenance fee of the product may markup with some % every year. Tiered pricing and price ramps are among most commonly required pricing schemes in a CPQ solution.

• Contractual Price
None of the customer or partner would ever like to re-negotiate the price of same or similar products/services. Contractual price helps maintain the negotiated and contracted price with customers, dealers and partners.

• Promotions & Offers
Promotions & Offers are the commonly used mechanism to boost sales. CPQ solution should facilitate to define and manage promotions & Offers.

Advanced Pricing Methods

• Prescriptive Analytics for Pricing
As a concept, Prescriptive analytics applies a multitude of business rule algorithms, multiple mathematical and computational modelling systems to automatically synthesise hybrid data sets and answer not only what will happen in future but what also needs to be done about it. In CPQ world, Prescriptive analytics can be used to drive more competitive pricing, which is based on historical data and prescriptive analysis.

• Market-Driven Personalized Target Pricing
In today’s world, Sales reps want to have more personalized and data driven target price to be shown while quoting instead of orthodox single static list price for everyone.

• Transaction Data based Dynamic Pricing
Transaction data (by order, product and customer) can be the best source to derive dynamic price for the quoted products.   

10 Key Considerations Before Implementing CPQ Solutions

CPQ plays a vital role in the overall sales cycle and revenue generation for organizations. It ensures error-free quotation process, with smart pricing capabilities and least dependency on IT functions. It is viable solution against prevailing manual process, which is tedious, error-prone and time consuming. With many inevitable benefits to organization, selection of appropriate CPQ solution and comprehensive considerations become more important. In this article I listed 10 key considerations for organizations before adopting CPQ solution. 

1. Choose a Simple CPQ
   Simplicity is the key for successful adoption of any CPQ solution. Salesreps, mostly familiar with excel sheets, sometimes find it difficult to use solutions which are complex and requires multiple clicks or navigations.


2. Prefer CRM-native CPQ solutions
   Both technically and functionally, it adds more value and provides greater flexibility if CPQ solution is either native or closely integrated with CRM.


3. Define Business CPQ process
   Most of the failures I noticed in CPQ implementation are due to lack of clear Business Processes around CPQ. Take this as opportunity to further streamline and optimize your quoting & approval process. Also have your process well documented before start implementing CPQ solution.


4. Simplify Approval Process
   In overall CPQ process, approvals play a vital role. Unfortunately approvals are also the part of process which consumes most of the time and make it complex. CPQ adoption is also an opportunity to make approval process more simplified, logically shorten and consistent.


5. Stop Comparison with Manual Processes
   Most of the salesrep are still comfortable with manual CPQ & Approval processes. One of the major reasons for non-adoption of CPQ solution is straight comparison between two. Remember that none of the software can fulfil all tasks accomplished by manual processes. Hence instead of one-to-one comparison, document processes/requirements and evaluate software based on functional needs and easy-to-use interface.


6. Functional Richness
   Ensures that the CPQ solution, you are planning to adopt, is functionally suffice your business needs. Closely evaluate the product modelling, quotation lifecycle, pricing capabilities, constraint rules, catalog/shoping cart functionalities, discounts, promotion/offers, customer facing document generation features, multi-currency support, and approvals.


7. Performance
   For most of the time, performance has been on the top of the demand list from users. Especially with CPQ solutions now moving to cloud, ensure that your solution performs well enough to be accepted by users.


8. Involve Users from Start
   Involve SalesReps, Pricing Leads, SMEs, Functional Leads, Managers and all category of users right from the inception phase. Conduct workshops/session, demos and listen to their current problems and expected solutions. Take their confidence in simplification process.


9. User Adoption is Key for Success
   As stated above, unless being adopted and comprehensively used by users, CPQ solution can’t add value to the overall sales cycle. User adoption is a multi-dimensional task, which needs efforts from different perspectives.


10. Training and Guidance
    Related with user adoption, proper training session and periodic skill upgrades helps hugely in making users comfortable to use the solution. Never compromise on trainings and education.

CPQ & OM - Need of the Hour for Telco Industry

Context

Telecommunication is perhaps one of the most dynamic industries, which involves huge complexity while modeling range of products, services and bundles offered to the customers and attach intelligent pricing models to those offerings. Out-dated offers, incorrect pricing, error-prone quotations, not only delay sales process but result in unhappy customers and loss of revenues.

CPQ (Configure Price and Quotation) solution facilitates easy modeling and configuration of various products, services, bundles and attachment of intelligent pricing models to those sellable items. It also provides comprehensive quotation/proposal management system. On the similar lines, Order Management (OM) solution manages the complete customer order journey and ensures smooth order flows and flexibility to incorporate in-flight and post-fulfilment order changes. These solutions add more values and prove more effective when built and closely integrated with organization’s CRM system.

This article is designed to briefly collate the key benefits in adopting CRM-native CPQ & Order Management (OM) Solutions with vital considerations during this adoption process. The focus is mainly on Telecommunication industry.

Industry Issues & Driving Factors

Telecom industry has recently witnessed the paradigm shift from “Network centric” to “Customer centric”. This necessitates the launch of complex but innovative products, bundles and service offerings, in shortest possible timeframe, with effective pricing models and preferably without any intervention from IT functions.

But in lack of a comprehensive CPQ system, many of the telecom companies are not able to withstand the current market challenges and competitions. Some of the key problem areas include:

• The complexity and volume of products, bundles and service offerings in telecom sector. This requires a system to correctly model the product and service offerings and avoid issues which can occur while using manual process.


• Increased Time-to-Market for value-added innovative solutions: Lack of CPQ system not only proof hectic while modeling products and services, but also delays sales cycle, in the era where everyone wants to bring the thought in reality without spending time in background.


• Dependency on IT for Product Changes: Another considerable issue is the need and dependency on IT functions for any product changes or new product addition in the system. CPQ provides handles to sales admin team to accomplish the same without much dependency on IT units.


• Incorrect Quotes, Longer Sales cycles and Reduced Revenues: Quotes with incorrect and out-dates product or pricing information, not only delays the process but vanishes the customer’s confidence. It may result in huge revenue losses and customer dis-satisfaction.


• Disconnected View of Customer’s Subscriptions & Order Journey across functions: Another major hurdle in telecom sector is the lack of consolidated view of customer across sales, legal, finance, operations and other functions.


• Difficulty in maintaining single view of Product with varied pricings across different sales channels. Many companies don’t have intelligent and logical pricing model to support multiple sales channels.


• Shorter Product Lifecycle: Telecom industry has most dynamics around the products, offerings and pricings. Shorter life cycle brings lot of challenges in meeting the sales team demands of frequent changes to meet market needs.

Business Benefits

CRM-native CPQ & OM solutions provide comprehensive solutions to most of the concerns and challenges listed above. Let’s elaborate some of the key benefits of these solutions:

• Easy and quick product configuration – A matured CPQ product would provide user friendly interface to create new products, bundles and service offerings. It also helps define eligibility rules, active date ranges, authorization rules and other features to control the visibility and eligibility for products and service selections.   


• Shorter Time to Market – With simple user interface to configure complex products and service offerings, and without much intervention from IT, CPQ solution can drastically reduce the effective-time-to-Market. 


• Intelligent Pricing Model – Pricing has always been a tricky and complex process in Telecom industry. A well-structured CPQ solution facilitates attaching intelligent pricing to sellable items using varied parameters.


• Better Quotation Life Cycle Management - A CPQ solution facilitates the complete QLC and provides out-of-box support for various stages of the quote. This includes quote creation, approvals, customer document generation and sending emails.   


• Single Product View across multiple Sales channels and geography – With CRM-native CPQ solution, the same view of products can be shared across all sales channels, with better configuration over different pricing models and visibility rules for different channels.   


• Better control over pricing, offers and discounts – CPQ solution facilitates to define different pricing using different parameters (date, quantity etc). This provides better control over offers and discounts and eliminates incorrect and outdated offers/discounts and wrong quotations. 


• 360 view of customer order journey and subscriptions – As CRM native, Order Management solution ensures that complete customer order journey and subscriptions are maintained centrally inside CRM and is available to all functions including Sales, Finance, Backend and Customer Success team. This further helps in cross and up sales.


• IT Independency for Product Changes – Easy-to-user interface of CPQ helps users to design new products and bundles offering, attaching intelligent pricing and control visibility, all through without interventions required by IT. This not only reduces the overall cost but also ensures less time to market.

Concerns and Considerations

As CPQ and OM solutions play a vital role in overall sales process and success of organization, it is important to highlight the key consideration while adopting these solutions. Some of them are listed below. 

1. As stated above, CPQ and Order Management solutions prove more effective and valuable when they are native to organization’s CRM tool. This should be the prominent consideration while adopting these solutions.


2. Selection of Appropriate CPQ Solution is the key for the success. A typical CPQ solution should facilitate easy configuration of products/services, attaching complex but intelligent pricing models, guided selling capabilities, contract/quotation life cycle management, approval system, and additional features like eligibility rules, filter criteria and search capabilities.


3. Simplicity is the key of any CPQ and OM solution. The more the complexity, the lesser would be the adoption and overall value response.


4. Ensures that your CPQ provider understands your business. CPQ users belongs to non-IT function, hence ensure that you are not opting solution which required much IT intervention.


5. Implementation cost, overall implementation time and amount of customization required, are other key considerations along with overall cost of the solutions.


6. Migration of products from existing modeling tool to CPQ solution and integration with existing applications should also be considered from technical and feasibility perspective. A phase wise migration should always be considered.


7. Integration with CRM, ERP and other application in enterprise landscape is another important consideration.


8. A matured project governance mechanism is required in product model life cycle management to ensure that models are configured properly, tested and are in non-conflicting state with other models’ rules and functionalities before available for sale in production.


9. And at the last but not the least, in most of the instances, migration from existing modeling tools to CRM-native CPQ solution requires a change in mindset of all users and must be followed by training and education for better adoption.

Why SalesForce Native CPQ & Order Management?

Although the success factor for CPQ and OM solutions is to be native to organization’s CRM tool, I would like to highlight the SalesForce CRM platform in this article, as it’s one of the fastest growing CRM platform with strong technical foundation to build CPQ and OM components. As most of the organizations across globe are either using SalesForce platform or eying to adopt it, it is a valid option to consider as CRM platform. Some of the noticeable benefits of SalesForce platform, to list, include 

• It’s one of the largest CRM platform and growing rapidly with over 100,000+ customer across globe. See the chart below. 


• It’s easy-to-use system and requires minimal configuration to accomplish even complex changes.


• It’s a cloud platform, hence doesn’t require any software or tools. All additional concerns like security, backup, auditing are taken care by the platform.


• There are plenty of native CRM and OM applications available in AppExchange (market place for SalesForce)

Success Stories

The list could be very long as lot of telecom service providers have already adopted CPQ and OM solutions with positive response to their overall customer experience, sales process, competitive advantages and growth prospects. I would still like to list few names as example here

o Telenor

o Open Range

o O2 Telefonica UK

o GTS Central Europe

o Brocade

o Telenet 

o MidStates Telecomm Solutions

o Telstra

Author

Ashish Arya is a Senior Solution Architect at Apttus. He has 12+ years of IT experience as Architect and consultant for SalesForce, Java/JEE and Open Source Technologies. He also has extensive experience implementing multiple CPQ and OM solutions for Telecom and other industries.

References

• https://www.youtube.com/watch?v=Egc9rHdLeos&feature=youtu.be
• http://endeavorcpq.com/pages/un-silo-with-software/
• http://apttus.com/blog/