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/