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Showing posts with label configure price quote. Show all posts
Showing posts with label configure price quote. Show all posts

Webinar May 27, 2021 - Master data in CPQ

Posted On Thursday, May 27, 2021


Patrik: But what’s the missing link that kills order quality?

Magnus: I don't think there is one missing link. I think there are many. And an additional challenge being that management's typically expect this to all be really be working.

Everybody involved in the processes knows that there might be glitches in the information transferring within the company. So, if the people that makes the decision don't think it's a problem, it's very likely that it's not going to be fixed.

We want to run this webinar to inspire because we know this is a solvable problem.

--


Magnus
: And while presenting this, we also want to point out some pitfalls that we have experienced over the last 20 odd years – when trying to get your master data to control CPQ and sales. 

We also want to note: You’re not alone, we are currently working with 4 projects importing master data (everything from medical devices to heavy equipment). As they say in the movies, it’s all based on a true story – while we cannot share details from the specific projects.

We’ll also run a mini-demo in the end.

--

Patrik: And so Magnus, what problem are we talking about? And whose problem is this really?

Magnus:  It's very likely that it's exactly the people listening in on this webinar that has this problem. And my guess would be that they will be engineers that they work in manufacturing that they work in logistics. Typically, I would not think that they work in sales and don't want to put on any blame game here. But many of the problems that we're going to see here has to do with sales. And make sense because it's really the problem that we're trying to solve with the CPQ system. Right?

--

Patrik: Let's go into it. In this webinar, we're going to use one piece of a product in every example, and it's going to be a beacon mounted on a roof of a light truck.

We think everybody understands what a light truck is – so it’s a good example.

We're going to use the example of a beacon that causes issues when we transfer information between different systems, between sales and so on. So we're going to start off with a small example of a problem flow, a typical example of problem flow.

--

Magnus: A typical example of how these error may occur in an organization:

Flow from the person that has the problem, to the person causing the problem

Patrik:

Sam works in supply chain, a beacon manufacturer has quality issues – he wants to remove the beacon temporarily from the product offering. He can easily make the change in his supply chain systems. But he wants to ensure the beacon is not sold, so he sends and e-mail to Jennifer that works in engineering.

Jennifer reads the e-mail the next day. She doesn’t really know what to the with the info, but she makes a note in the PLM system.

Tom works with the CPQ rules, and he’s developed a magic Excel macro that exports data from PLM and formats it nicely. Notes in PLM are ignored.

Nora works in sales. She has a huge deal in progress, 200 light trucks – here biggest order ever. She creates a quote from CPQ, and gets it signed.

Supply chain gets an e-mail with the quote – and sees, 200 beacons ordered!

I mean, can you point out the person that's at fault here?

--

Magnus:

Not really. I would say it's everybody's fault. We have this problem, this problem goes two ways.

So there is a problem for everybody who knows something about the product to make sure that everybody in sales is informed. And then it goes the other way around as well that, the information that sales knows about the customer and the preferences and everything needs to flow back also into manufacturing and into production planning.

 Whatever be, all these other functions, everything that Sam and Jennifer and Tom does. So today, in this, we're going to focus on one of the directions. The information flowing from Sam, Jennifer and Tom into Nora's CPQ tool.

The problem is that we saw here with Patrik’s example is that, this is sort of like a “Broken telephone”. One tells another tells another and all of a sudden the story has changed. This is very funny if you're five years old, and you go to birthday party, but it's not so fun when it's in your daily routine. And this is really the problem that we're trying to solve; the “Broken telephone” problem.

--

Patrik: We touched on this already. But in this webinar, we’re very one directional. We're going from supply chain and engineering all the way out to sales. But as just as you mentioned, Magnus, we need this bi-directional flow, where what sales knows that is really essential flows back to Product Development and Engineering, because that's essential for them to know what new products to engineer, what new products to deliver. And this is a topic thatac ompletely new webinar.

So if you're listening in and you're in sales, your day will come!

--

Patrik: So Magnus, with that said, with your 20 years of experience, what should you start with? What kind of information should you include in a CPQ system?

Magnus: Okay, you can think of this from different aspects. Of course, one important thing when it comes to profitability is that you keep your prices in sync. It's quite straightforward. And it's not very complicated from a configuration point of view. Because, it's just a number, and it has to get the calculation in the pricing module correct.

But if we look at another common wish, I wouldn't say it's a requirement, but a common wish, often in early stages of a project, is that okay, but we should get warehouse availability into our CPQ system? There are a few problems with this, isn't it, Patrik

--

Patrik: the first problem with warehouse availability is that most likely medium or low quality. If you work as a responsible for ERP system, you're going to know that the quality of that data is not actually very high. So you start off with trying to include information into the CPQ system with low to medium type of quality. And on top of that, you have the question of, is it really important? Are you going to deliver this piece of equipment in the very near future? It’s like to drive a car by looking in the rear view mirrors.

--

Magnus:

Yeah, and the reason there is because it's very difficult to foresee the consequences. So for example, if we take Sam’s beacon here, if we remove that from the CPQ system and say that it can't be sold, there will be Domino effects. So you remove the beacon, and if you don't take into consideration that it's actually a legal requirement in France, that you cannot sell a construction truck, unless it has a beacon, then you will, by removing this beacon, block sales in that country. And this is just an example where it can be very difficult to foresee the consequences, this with the changes in the master data will have an effect on your CPQ system. It's not necessarily always a good thing because it's very difficult to foresee the consequences. When something is removed, many other things will fall by consequence.

Okay. So we should really talk a little bit about low and high risk here when it comes to integrating data. So what's your take on this, Patrik?

--

Patrik: Important analysis early in the project. It's easy to say that we should do the low risk things. For example, we just spoke about prices, and we said price is just number. And so it's kind of low risk + high reward to keep that in sync with external systems.

But then there are things that are more high risk to include in your configurator. And one example could be then quite common that you have some sort of country of availability, or you allow it or should you be selling this piece of equipment to a country. So it could be legal requirements, or it could be marketing demand or something like that. And while there is probably a high value of making sure that you don't sell the incorrect item to the wrong country, there's also an extremely high risk here, because you could get those kind of Domino effects that we just spoke about a moment ago, where you remove a beacon and that beacon is a legal requirement for some option, for example, construction trucks, and thereby you cannot sell construction trucks, which is high risk, you might stop your sales in a critical faith.

 

Magnus:  You could also turn the question around and say that it's a big risk that we sell these as well. If we cannot source the beacons in a few weeks, we're gonna have a big problem in France.

 

Patrik:  Exactly. So with this said, just because it's high risk doesn't mean we should not do it. We should just be more careful when we do it.

--

Patrik: Let's try to draw this map of what kind of information and system are we talking about.

Magnus: There can be many systems when in an organization- you know quite a bit about this, Patrik, because you have a lot of experience. Let's bring up some three letter abbreviations here. And I'll let you have a go Patrik.

Patrik: Let’s bring in our people again, so we don’t get stuck with the abbreviation. Jennifer works in Engineering, and manages the product with her team. Sam works in supply chain and ERP, and is responsible for making sure the product is supplied with parts and actually manufactured. Tom sits in between all these systems, and tries to collect all required information into the CPQ-system. Nora works in sales, and uses CPQ daily.

These are the typical systems to fetch information into CPQ automatically.

What’s important:

* All these systems are great expert systems for their specific purpose. But only CPQ can overview the complex relations for the complete product, for example what will happen when removing the beacon.

* PLM typically (if used) contains all modules and variants you want to sell – also called EBOM. ERP typically contains parts delivered to the customer, also called MBOM.

Magnus:  But does that mean that we need to make all the ERP and PLM info available in CPQ?

Patrik: If you're a PLM centric company and you actually have control of all the modules, module variants, and so on, maybe even some of the technical rules in the PLM system, it might be a good idea to extract the information and drive to CPQ system based on this. The same may be true for ERP. But it's not a good idea to believe that you can mirror all the PLM or ERP structures and rules straight into CPQ. Then I think you're doomed to fail. What do you think, Magnus?

Magnus:  Yeah, and I think we keep coming back to this whenever we discuss product data in any sort of form that, what's important for sales, and what's good enough for sales? So we don't need the nitty details that you need to keep track of in the PLM system. Can you provide some examples of how a typical product structure can provide us with completely different sets  of data that Tom and Nora might need.

Patrik:

Let me show you a very simple product structure of our beacon. We have the module beacon which may exist or not. And the beacon consists of a number of parts, in this case shown as glass and bolts.

Let me give you some examples of inromation that may be needed in CPQ for an organization:

Example 1: Spare parts for service contracts from PLM. Probably doesn’t make a lot of sense for a beacon, but very important for biopharmacetical company where the spares is an essential part of the business model.

Example 2: Country of availability for modules from ERP based on legal requirements or marketing decisions. Are we allowed to sell the beacon to Norway or not? Essential to sell the correct product.

Example 3: Technical rules describing the relation when you can have the beacon or not, it may compete for the same space on the truck as an aero package. Typically coming from PLM.

Magnus:

First example, Data in synch

Second example. block things not allowed to sell in markets

Third example: re-use of existing rules.

I’m answering my own question here. It depends on what ifnroamtion that’s relevant for our organization. We don’t need all data.

--

Patrik: We mentioned risk before we started talking about the type of data.

Magnus:

Automation is also risky.

We always ask this question:

The upside of using the correct data, it's quite obvious, but what is the risk of using this data? And what can we do proactively to mitigate this risk.

Examples:

E.g. Don’t block sales, only prioritze lower or warn

Only choose the beacon if there is absolutely no other solution

Maybe we should move the beacons so that it's not something that the sales rep can sell themselves, or quote themselves, but they will need to do an ETO request.

Another thing could be if we want to decrease sale of something where we know that we have a sourcing problem, work with pricing, for example, or maybe a combination of these two. If you know that for some customers, the beacon is very important, they really need it, they are willing to pay whatever it costs.

--

Patrik:

 Vad ska man börja med?

Quality vs Time-savings

--

Magnus:

And then, for me, time savings can always be done later, but my strong belief is that we should always start with things that increases our quality. And in addition to that, where we can handle the risks without risking the usability for sales of the tool.

So are there any other things, any other ways that we can mitigate these risks that we were talking about?

 

Patrik:  I mean, I think an obvious answer to this is to make sure to test as much as possible. I mean, obviously, testing is essential in all projects. But especially when you start integrating things.

--

Magnus:

Okay, so in practice, what does that mean when it comes to data integration? When we have integration, we want to split this up in several steps.

Because if something goes wrong, so all of a sudden, something doesn't work, due to our integration of sort of live data, we want to see and easily understand why and how it breaks.

Keep in mind that we should, at any given point be possible to do effective debugging of this. We should definitely not create a black box.

--

Patrik: What we've seen in the project we run together is that, the human mind is really amazing when it comes to finding patterns and spotting changes.

We recommend having an intermediate format, for example in Excel.

You can use the combination of the human mind on finding patterns and spot changes, but also use the classical tools we’re used to.

Magnus: Like using Excel or Tacton Studio for debugging.

Patrik:  It may sound kind of rudimentary to use Excel. You need to keep in mind it’s impossible to tests all combinations in product configuration. You easily end up in billions and billions of combinations which would take the eternity of time to test. It's better to go back to as close as possible to the source and try to understand the source before you push it into Tacton.

--

Magnus: Okay, so a webinar without some kind of demo, is that a good webinar, Patrik?

Patrik: Every webinar should have a demo! But you’re going to demo using a click-dummy, right?

--

Let’s run a demo of ‘Beacon trucks’.

Magnus: So first off, this would be the normal behavior in our CPQ system, we get the beacon light, t’s an option they include by default (hence the name).

--

Magnus: But then, with some automated data flow directly from Sam's system, we can say that we should lower the priority here on this specific SKU. So now with this information flowing into the system, the CPQ system automatically still offers the beacon light as an option but the default will data driven be set to none.

--

Magnus: And the second thing, and just to bring this closer to a real life example, is that we also do at the same time, do a slight adjustment of the price.

So this beacon light becomes a little bit hefty when it comes to price compared to what we sell this truck for. So that we not only do one thing, maybe we do two things.

--

Patrik:

Expect high-fives when you’ve delivered this project – but also expect that this is a steep hill to climb.

Managers will just expect that it should have worked from the beginning! And you are indirecltly limiting sales from selling anything they want.

But as a company, expect higher margins and less order errors.

Patrik:

If you only remember 3 things from this webinar, what should that be Magnus?

Magnus:

Don’t over-automate, because of the hidden domino-effects.

Focus on quality! You can always save time later.

Focus on playing the ”broken telephone game” at children parties – do less of that at work.

Patrik, did I catch the most important things?

Patrik:

I’d say, don’t forget a human readable format that you can read and understand for your integrations. Don’t let code get in the way of understanding what’s happening from a business perspective!

 

Any more questions, just give us a call

 

Patrik +46736614953

Magnus +46762098557

Top 5 things you should read or listen to before starting your CPQ project

Posted On Monday, November 2, 2020


Ok, so you're planning to implement CPQ at your business. You figured you should maybe do some reading to learn some tips and tricks. Where should you start?

We've collected the 5 most important things you should read or listen to about CPQ before starting your project.

1. Gartner's Magic Quadrant

Gartner publishes a research paper once a year in the form of a Magic Quadrant. The latest version was released in Fall 2020. The document can usually be downloaded for free from some of the vendor's web sites (Tacton).

2. Knowledge-Based Configuration: From Research to Business Cases by Alexander Felfernig, Lothar Hotz, Claire Bagley, Juha Tiihonen

This is an academic-styled book about configuration. We don't recommend you to read the whole thing, as it will gain you limited value for actually implementing CPQ. We do recommend chapter 2 for a brief history of configuration, chapter 6 for understanding of different technologies for CPQ and chapter 16-19 for valuable insights into implementations at different companies.

3. Product Customization by Lars Hvam
This is a really good book for preparing your company for a CPQ implementation, how to document your CPQ data before the implementation.

4. The CPQ Podcast

Novus CPQ is an independent CPQ analyst firm. Their podcast is focused on interviewing experts and CPQ vendors. Some of their interviews are really insightful:

5. Top 10 reasons why CPQ projects fail

Don't miss this blog post describing the top 10 pitfalls when implementing CPQ. Learn from mistakes made in other CPQ project, and avoid doing them in your project.

What is a sales configurator ?

Posted On Monday, September 9, 2019




With an online sales configurator – like Tacton CPQ – your customers, resellers, retailers, and sales teams can easily configure and display their products on any device. Access to the online sales configurator is possible anytime and anywhere. It's much like having an experienced product manager who offers the best suggestions while ensuring products can be produced. The pricing module of the sales configurator will make sure the price is competitive and profitable.

The sales configurator controls what products are available to what user.  Changes to new products, options, pricing, promotions and marketing materials can be distributed instantaneously, so all sales channels always have accurate updated information.

A sales configurator helps translate product features into value and benefits. A sales configurator integrates rules and business logic for design, manufacturing and cost, and will reduce the training needs and the in-depth product knowledge. A sales configurator also reduces costs due to errors and incomplete offers.

By presenting the entire product range in an online sales configurator, your customers can configure their product choices, get quotes instantly, set accurate delivery dates, and even place orders with no or minimal impact on sales.

A sales configurator is often used to guide customers to the right buying decision based on their needs and budget. The “Guided Selling” approach identifies ways to promote higher value products and introduce new revenue streams, such as: service contracts, aftermarket packages, add-ons, and warranties.

By making it easier to buy the products thru the sales configurator enterprises build strong relationships with customers and strengthening brand loyalty. A smooth sales process has a very positive impact the sales process and the way companies bring their products to market.

Today's B2B and B2C customers want options and customizations for most offers. Customers also want to receive complex offerings in no-time. Finally, customers expect a quick response to changing demands on purchase contracts.

To provide customers with this flexibility the sales force will need tools like a sales configurator that accelerate supply, ensure accuracy, and make selling custom products and services as easy as selling standard offerings.

With a sales configurator a sales rep can create quotes and quotes that are instantly. It’s no longer necessary to search for price list information, brochures, old proposals and other sources. The sales representative doesn’t need to request expertise from other teams and departments. Instead, they can launch the sales configurator from a tablet or browser. Intuitive questionnaire will deliver the right product, the right price and a fancy quote within minutes.

The sales configurator business logic provides non-sequenced questions, 2D and 3D visualizations, and continuous calculations to ensure product conformity. Pricing, discounts, margins, and more are calculated in by the advanced pricing engine to ensure bottom line profit.

With an advanced sales configurator – like Tacton CPQ – a sales rep will NEVER get stuck between conflicting choices. The sales configurator will always present a valid product selection and will also indicate conflicting choices. There’s a big difference between different techniques to describe “the product rules”. All will stop you from doing wrong, just a few will help you do right. This makes a difference front-end but will also dramatically simplify maintenance of the business logic.

How a sales configurator contributes to business success

Customer Confidence: the product selection is customer centric and asks questions based on customer needs and budget. A sales configurator an suggest the optimal solution for a specific customer. This creates confidence

Guided Selling: A modern sales configurator will guide sales representatives through the sales / 
quotation process. The sales configurator quickly identify ways to cross-sell and up-sell accessories and other products, helping the sales representatives to better meet customers hidden needs.

"Selling the Impossible": Sales representatives will never again sell impossible solutions, products that can neither be produced or delivered. “Selling the impossible” is a far to frequent and often costly job mistake. In a sales configurator an impossible combinations is simply blocked.

Mobility for responsive service: Sales representatives can work anywhere on devices from laptops to smartphones to create and adjust outstanding quotes. The information is stored and version handled directly in the sales configurator.

Full Insight: With a modern sales configurator sales representative can quickly show how options can affect weight, price, production time, and other critical variables.  

Product Visualization: “Seeing is believing” and depending on customer expectations both the 2D and 3D views can be presented directly in the sales configurator. This makes the configuration easy to understand and has proven to shorten the sales cycle for both simple and complex products.

A sales configurator will change the way your sales representatives do business, negotiate complex deals and respond quickly to changing product and service requirements. Learn how to use the sales configurator to configure virtually anything on any device to ensure a fast quote and responsive customer service!

CPQ meaning

Posted On Wednesday, August 28, 2019

CPQ meaning


Definition

The meaning of CPQ is Configure Price Quote. The acronym is used to describe a system to support sales by guiding selling, governance of pricing and automation of document creation.

Configure Price Quote (CPQ) is the combination of techniques, strategies and technologies that companies use to manage and customize products throughout the customer lifecycle, with the goal of improving customer service and assisting in customer retention and driving sales growth.

CPQ systems compile product and pricing data across different channels, across the company, which usually include the product management, sales, marketing and R&D.

A CPQ systems can also give customer-facing staff detailed information on buying preferences thru a guided sales process.

CPQ has historically been used by larger enterprises, but the market is now moving toward small and medium sized businesses mostly due to cloud technology lowering the overall cost.

Components of CPQ


At the most basic level, CPQ consolidates product information, pricing and documents into a single “CPQ database” so business users can more easily access correct information. Business logic explains dependencies and ensure product correctness, pricing alignment and unified quote documents.

Over time, many additional functions have been added to CPQ systems to make them more useful. Some of these functions include automating various workflows, various calculations, advanced pricing structures and pricing models. Analytic capability gives managers the ability to track customer preferences and product inefficiencies based on information logged within the system.

Sales automation: CPQ tools with sales automation capabilities can automate customer interaction offering a 24/7-service for advance product enquiries. For example, as sales prospects come into the system, it might automatically send the prospects marketing materials, budgetary pricing indications typically via email, with the goal of turning a sales lead into a full-fledged customer.

Workflow automation: CPQ systems help businesses optimize processes by streamlining mundane workloads, enabling employees to focus on creative and more high-level tasks.

Lead management: Sales leads can be tracked through CPQ, enabling sales teams to input, track and analyse data for leads in one place. This is often combined with online presence of the configurator.

CPQ Analytics: Companies are keen to capture customer sentiment, such as the likelihood that they will recommend products and want to measure the overall customer satisfaction to develop marketing and service strategies. Companies can integrate CPQ data with other customer data from sales or marketing departments to provide a consistent view of the customer. Analytics in CPQ help create better customer satisfaction rates by analysing user data and helping create targeted marketing campaigns.

Geolocation technology: Some CPQ systems include technology that can create geographic sales campaigns based on customers' physical locations. This is important to make the product offering more adapted to the country or region. Geolocation technology can also be used as a networking or contact management tool in order to find sales prospects based on a location.


Types of CPQ technology


Some major players within CPQ systems are Apptus, Salesforce and Oracle. Other providers are popular among small to mid-market businesses, but these three tend to be the choice for large corporations with simple configuration problems. Some CPQ providers offer more advanced solutions for specific business segments such as Tacton that offers advanced CPQ with primary focus on the manufacturing industry.



The types of CPQ technology offered are as follows:

On-premise CPQ: With this system, the information about the company needs to be managed, controlled, backed up, and maintained using the CPQ software. With this approach, the company acquires licenses in advance rather than purchasing annual subscriptions from a cloud CPQ provider. The software resides on the company's servers and the user pays for upgrades. In addition, a longer installation process is usually required to fully integrate a company's data. Companies with complex CPQ requirements can benefit from a local deployment.

Cloud-based CPQ: Cloud-based CPQ, also known as SaaS (Software as a Service) or on-demand CPQ, stores data in an external remote network that employees can access anywhere, anytime. Sometimes an internet connection is established with a third party who oversees the installation and maintenance. The cloud's fast and relatively simple provisioning capabilities address companies with limited technological expertise or limited resources.

Companies might consider cloud CPQ as a more cost-effective option. Vendors such as Tacton charge by the user on a subscription basis and offer the option of monthly or yearly payments.

Data security is a major concern for companies using cloud-based systems because the company does not physically control the storage and maintenance of their data. If the cloud provider gives up the business or is taken over by another company, a company's data can be compromised or lost. Compatibility problems can also occur when data is first migrated from an in-house system to the cloud.

Finally, the cost can be an issue because paying subscription fees for software can be more expensive over time than with on-premise models. On the other hand, with a hosted SaaS solution improved functionality is constantly added to the CPQ platform.

CPQ examples in practice


Direct sales: Traditionally, data intake practices for CPQ systems have been the responsibility of sales and marketing departments. Sales and marketing teams procure leads and update the system with information throughout the customer lifecycle, and with the help of CPQ they gather data and revise customer history records through calls, meetings and technical support interactions. The CPQ system provides accurate pricing, correct product selection and impressive quotes.

Digital twin CPQ: CPQ can interact directly with customers thru a 24/7 business portal. CPQ gives the customer the possibility to investigate and understand the product offering prior to contacting a sales representative. This gives the company the possibility to find new lead thru automated channels and it give the customer a digital sales companion to guide thru the early phases of the sales journey.

Mobile CPQ: CPQ applications for smartphones and tablets are a must for salespeople and marketing professionals who want to access customer information and perform tasks when they are away from their office. Mobile CPQ apps use features that are only available on mobile devices, such as mobile devices. For example, GPS and voice recognition capabilities enable sales and marketing professionals to access customer information from anywhere.

Business-to-Consumer (B2C) Practices: A CPQ system in a B2C environment helps monitor sales as they go through the sales funnel and enables a business to solve any issues that may arise during the process. CPQ systems in the B2C market help improve the transparency of leads and thus increase the efficiency of the entire sales process.

CPQ challenges


For all the advancements in CPQ technology, without the proper management, a CPQ system can become little more than a glorified database in with product information is stored.

Companies may struggle to achieve a single view of the product portfolio. Challenges also arise when systems contain inconsistent data or outdated information. These problems can lead to a decline in customer experience due to lack of trust in the CPQ tool.

CPQ systems work best when companies are able to keep the product information up to date without involvement of consultancy services.

Multi-channel sales CPQ with ease

Posted On Wednesday, August 21, 2019



Multi-channel sales are made simple with CPQ. Managing multiple sales channels within the same tool can be troublesome but, this is a worry of the past. This might be a bumpy road, but in this article will sort out what you need to consider in order to support your multi-channel sales challenges.


What is multi-channel sales?



Multi-channel selling is the process of selling your products on more than one sales channel. Multi-channel management includes a mix of your own sales representatives, partners, OEM-suppliers and maybe directly on your website.

Selling on multiple sales channels increases your exposure to potential customers and will increases your sales opportunities. Multi-channel sales are also a way to minimize risk, especially for niche buyers and markets.

In the age of digitalization there is an increasing demand for online presence. In the time of of self-service sales, it’s important to minimize the product complexity and the potential errors due to misunderstanding. This is one of the main drivers for guided selling and high-level product guidance in the CPQ software.

Multiple sales channels give the opportunity to differentiate prices to match your service level commitment. The delivery terms and after-market commitment can also differ between channels.
The three main challenges in multi-challenge sales are the following;

Product offering per sales channel
Pricing and discounts per sales channel
Term and conditions per sales channel

Let’s dive deeper into each one of these topics and how a multi-channel CPQ can support these requirements.

Product offering and guiding your customer

The CPQ solution must be able to easily handle variations in the product portfolio. To start, not all products are sold to all markets. In the same way, it must be possible to control what options and features that are available for different sales channels. Obviously, all CPQ systems can manage this – the key questions is the effort to keep this kind of information up to date.

The second thing is the possibility to communicate and speak the language of the end customer. Different sales channels have different knowledge about your product. Where users in one channel care more about the overall performance of your product is in big contrast to a sales channel with very much focus on details. Here you want to keep the same “core product logic”, but be able to adjust what kind of questions to ask depending on sales channel.

A modern CPQ solution will provide effective tools to tailor general product logic to a specific sales channel.

Pricing and value


Price lists and discounts will most likely be different when you do multi-channel sales. Depending on the perceived value of the product and services provided thru a sales channel it’s very likely that prices are adjusted accordingly.

With multi-channel sales it’s possible to sell both highly standardized products and highly customized products at very different price points. A customer asking for higher level of customization will likely have a more expensive products as their next-best alternative.

A customer looking at a very standardized product might not expect to get the extensive know-how your company can offer and will therefore not value the product at the premium price point normally used. Selling a limited product portfolio thru a dedicated sales channel can be an opportunity to reach these customers that in other cases would have chosen a different vendor.
A modern CPQ solution will provide multiple price lists associated with specific markets or customer types in a multi-dimensional fashion.


Terms, conditions and appearance


Selling thru multiple sales channels will require different content and branding of the generated quotes and proposals. With multiple sales channels it’s possible to deliver exactly the same product but with different terms and conditions to match expectations within a certain sales channel or industry vertical.

A CPQ solutions can produce much more than just line-item prices; it can automatically create a full-blown proposal including customized 2D- and 3D-drawings. This is especially important in sales involving complex products or applications and can create a unique conformity in the quoting process.

The content is likely specific both to country and sales channel. For a global company it’s also important to support quoting in more than one language.  When it comes to multi-channel sales it’s equally important to align sales pitch as getting the language correct.

Bottom line


With modern CPQ software you can address all of the issues of multi-channel sales mentioned above with ease. With a CPQ solution it’s possible to deliver market and channel specific proposals, priced correctly and, of course, only with products available in alignment with your overall product strategy.

If you need advice on multi-channel sales CPQ, please get in touch.

Why use CPQ?

Posted On Monday, August 12, 2019


As the product portfolio grows many companies choose to use a CPQ system. A typical CPQ-user works for a company that offers a very wide range of products or services. The sales representatives (and to be honest usually others in the staff as well) have a hard time managing product prices and product dependencies. The products sold often have many options with critical technical/commercial dependencies.

CPQ software is useful by companies that need to quickly calculate prices. If a sales representative needs to quickly prepare a quote for a customer, the CPQ software automatically sums up all important information. This means that the representative can produce the quote and come back to the customer far quicker. Time is an important differential factor for all companies, regardless of whether the company works in faster or slower markets. Speed ​​is always important.

Global companies, large and small, use CPQ to quickly and effectively send pricing information to partners and customers. This means that customers can get the information right when they need it.

CPQ software is an effective way to unify how the products are presented to the customer. By using an automated tool for quote documents product can be presented in a consistent way and critical information is never missed due to human errors.

Studies show that the companies that respond the fastest have the greatest chance of finally winning the deal. This means that the speed offered by a CPQ system can have a major impact on the company's bottom line results.

In the past only large corporations could afford to use CPQ, but nowadays we see a big expansion of CPQ in small and medium sized business.

CPQ Analytics

Posted On Wednesday, June 26, 2019

Here's a presentation on CPQ Analytics, presented in Stockholm at Tacton Day October 8-9 2015.

Five common pricing mistakes a CPQ solution will address

Posted On Friday, September 2, 2016



Pricing is difficult and also very sensitive. Changes in pricing is one of the most effective way to level overall profit.

This list of pricing mistakes can be used to build a good business case for a CPQ (Configure-Price-Quote) investment.

Weak controls on discounting
It’s not uncommon that sales representatives are given a lot of freedom when it comes to negotiating the price. This means what the profit per deal is very dependent on the person executing the sales.

Discounts are often given without a controlled won/loss analysis and are more based on gut feeling. This means that prices will vary very randomly.

Without analysis and a proper approval process these issues will not go away. This is something a CPQ solution will address.

Inadequate systems for tracking competitor selling prices and market share
It’s difficult to understand the completion and most companies don’t put any effort into analyzing the lost deals.

With a CPQ solution it’s possible to benchmark the won and lost deals in a very structured way. It’s possible to find what key features of the product that correlates with won deals and also what features that are typical for lost deals.

Cost-plus pricing
Cost plus pricing is still very common in the manufacturing industry. The problem with this approach is that it assumes that the customer value is dependent on the production cost. Everybody knows that this is not the case.

A CPQ solution can price on factors that are actually valued by the customer and at the same time ensure that margin.

Price increases poorly executed
There is a problem when price increases can’t be motivated. If we’re not providing any new customer value, why should I pay a higher price?

It’s essential to plan ahead and do price increases as your product improves. If your new engine will cut fuel consumption there is no problem to pay a higher price.

That’s why price increase should be coordinated with product development. This means that timing is essential. Do the math and plan ahead. This is a process that a CPQ solution should support.

Worldwide price inconsistencies
In a global market it’s no longer possible to have inconsistent pricing.

By introducing a central storage for local price it’s possible to understand and correct price inconsistencies. A CPQ solution normally connects the global and the local prices. This means that a CPQ solution introduces the possibility to have governance for local pricing.

Configure Price Quote software - the key benefits

Posted On Monday, August 25, 2014

Configure Price Quote software shortens the sales processes by automating the configuration, pricing and quoting of complex products, services and bundles.

“configure price quote” software is getting attention from global companies looking to reduce errors and streamline sales of complex product. Configure price quote software will serve as a consistent front-office interface with all necessary integration to existing back-office systems.

CPQ (“configure price quote”) is more and more becoming a critical advantage in several industry verticals. Fast and accurate quotation processes is no longer something to strive for – it’s now a critical factor in the competitive landscape.

The primary benefits with Configure Price Quote software include:

  • Guided and automation sales process supporting your customers through important selection including configuration, quoting and ordering.
  • Central pricing processes for establishing, maintaining and publishing pricing for products, services and combination bundles.
  • Workflow for quoting including creation, management and negotiation of sales quotes.

Guided and automated sales process

  • Increased deal size by simplifying cross-sell, up-sell and solution bundles. Service contracts and other related services are quoted together with the product ensuring returning revenue for a longer period of time.
  • Reduced costs and increased customer satisfaction as incorrect orders are dramatically reduced.
  • Increased sales productivity when repetitive, time consuming manual work is eliminated.

Central pricing process

  • Pricing consistency and automatic pricing changes instantly available in all sales channels.
  • Defined structure for pricing to decrease the maintenance due to changing market conditions.
  • Pricing models based on customer segments with analytics feedback for continuous improvements. Built in dashboards for sales and pricing governance.

Workflow for quotations

  • Significant time savings to create, negotiate and convert quotes into orders.
  • Increased visibility and traceability in the quoting process.
  • Support for channel and partners sales for complex products.
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