5 Key Considerations

CPQ (Configure, Price, Quote) is a centralized error free, automated platform for configuring, pricing, and quoting products for companies selling products or services.  Implementing CPQ can deliver enormous benefits—here are five considerations to help you assess whether you need CPQ and how to set yourself up for a successful CPQ implementation.

1. Signs You Need CPQ
   • Your team is still quoting via spreadsheet(s) causing challenges like:
     • Inability to lock down pricing, product SKU’s, configuration so these elements can’t be altered
     • Inability to efficiently update and disseminate pricing – legacy versions persist
     • Unable to track versioning — who is and is not using the latest version. Individuals don’t know if they have the most current version.
     • No tracking of when quotes were presented
     • No visibility to when quotes are expiring
   • Inconsistent pricing application – complex spreadsheets and lack of controls can lead to reps delivering different quotes for the same product. Pricing is inaccurate, not standard, or just plain wrong.
   • Not consistently applying account-based pricing or enterprise/contract pricing, rate cards
   • Poor/no visibility to key company metrics such as:
     • Number of quotes in the pipeline
     • Popular SKUs vs. under-utilized SKUs
     • Reporting on and managing discounts
     • Discount approvals, delegations of authority
     • Reporting on and managing margins
     • Difficulty tracking quote amounts/pricing
     • Reporting on or growing your enterprise account base
   • Quote/Contract documents are full of typos and errors and don’t include product specific terms
   • Renewals for SAAS companies – lack of visibility to upcoming contract renewals, results in:
     • Lapsing Contracts
     • Additional work to negotiate/reinstate renewals
   • Lack of options to support mobile workforce – current solution doesn’t offer mobile capabilities needed by remote sales team.

2. Common CPQ project roadblocks (and how to overcome them)
   • Cost – viewed in isolation, a CPQ project can appear costly. However, the transformative capabilities and savings offered by CPQ often deliver an attractive ROI. A Salesforce Partner like Demand Chain can help you capture and quantify these savings.
   • Standard pricing in flux – consider working with Finance to establish base pricing
   • Evolving product configuration and/or product options – start with your base configuration
   • Product configurations are too complex – This can often be addressed by using the 80/20 rule. Analyze recent quotes, look for patterns or frequently quoted configurations.  Companies can usually handle 80%+ of their pricing/quotes via CPQ.  The remaining exceptions can be handled ad hoc.  Your Salesforce Partner can assist you in evaluating how to best address this.
   • Inconsistent Sales and Quoting Process – individual sales reps often have different quoting and sales processes. CPQ configuration will help highlight inconsistencies and lead you toward a more uniform process.

3. Critical inputs to make your CPQ project go smoothly
   • Pricing – Have your current pricing captured in a product list or price book, identify known product bundles.
   • Processes — Have all your processes documented (or be prepared to document them).
   • Change Management commitment – High user adoption is the key to a successful implementation. If CPQ is not used (or used correctly), it won’t deliver value. It’s critical to have an internal change management champion.  Develop a Change Management plan to communicate to users early and often about the timing and benefits of the project.  Plan for multiple rounds of user training over an extended period to maximize adoption.  Be prepared to address where quotes will be created, a plan for a cutover process, training, and sunsetting legacy quoting systems or spreadsheets, and adherence to a new consistent quoting and sales process. Secure leadership buy in. Illustrate the WIIFM.  Ask your Salesforce partner for Change Management recommendations and training assistance.

4. Key factors that drive CPQ project success
   • Internal Resources– CPQ projects can be complex. They require participation from many internal groups, including IT, Sales, Pricing, Operations and more. Capturing current state and defining optimal future product configurations, pricing and processes takes time.  Be sure to invest the time needed for participation from critical internal teams to ensure your CPQ project success. Before building a CPQ process, business and sales processes must be clearly defined.
   • Future Spending– some companies expect their CPQ project to be “one and done” — a major one-time project with little need for future work. That’s rarely the case.  Once in place, most companies budget for and execute enhancements to their CPQ on an annual basis.  Your Salesforce Partner can assist you with budgeting resources and dollars for future years.

5. CPQ Project Benefits
   • Clarity – emerge with a clearly defined sales process, product bundling, quoting process, approvals, product list and or price book, updated and accurate pricing.
   • Speed – easily deliver error-free quotes in a fraction of the former time–reductions of 75% to 90% are not uncommon.
   • Accuracy– pricing is accurately executed due to a centralized pricing database, pricing logic built into the system, discount approvals, elimination of “ad hoc” options, etc.
   • Efficiency – easily update products, pricing levels, discounts, approvals, document templates, notifications and communications can be quickly. Changes are immediately accessible by all users.
   • Quality– present quotes and documents free of pricing and/or grammatical errors—reinforcing a consistent, high-quality impression of your company brand.

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