The onset of digitization is transforming the competitive landscape for enterprises and the way organizations function. There has been a stark change in customer expectations and consumer behavior, leading to a significant impact on the CPQ (Configure Price Quote) process.
Traditionally, the CPQ process has been used to enable sales organizations to automate and optimize the creation of quotes and capture of orders for prospects. However, with the growth of digitization, CPQ also has to undergo several changes in order to meet the evolving needs of organizations.
Price remained a largely ignored factor in traditional CPQ solutions. These systems continued the use of standard price lists with sales representatives, not considering any other factors or context in generating the price lists. This has led to a lack of intelligence in the decision-making process, causing problems such as over-discounting and volume-driven sales tactics.
Modern CPQ solutions need to overcome the above challenges and equip selling channels with the best buying experience. They should also deliver the right price to the right customer. Once price optimization has been integrated into the CPQ process, it will open up massive profit opportunities through a faster time-to-quote, increased profitability, and an enhanced, specialized customer experience.
In order to fulfill all the requirements as stated above, the CPQ solution needs to undergo transformation as a whole. This transformation will not only bring value to the sales process of an organization but also minimize build time and complexity in the early stages of production. It will also help in building intelligent inventory control decisions, resulting in an enhanced supply chain management. In addition, accurate product pricing and configuration will result in lower waste processes.
CPQ transformation is not easy. For it to be successful, in addition to deploying a robust solution, organizations must embed a well-defined lead-to-order process across the organization. The following steps need to be executed in order to ensure complete transformation and implementation of the CPQ solution for any organization:
- Organizational preparedness for ensuring successful CPQ implementation and change management processes to regulate the changes cause by the implementation.
- CPQ alignment with the front office applications and ensuring data integration with CPQ and ERP.
- Streamlining CPQ adoption through collaboration at an organizational level.
As companies continue to grow in the digital space, CPQ transformation and use will help organizations toward quicker Q2C (Quote-to-Cash) enhancing customer experience, improving sales and increasing revenue. All these contribute toward taking organizations one step closer to complete digital transformation.