Transitioning to a CPQ system will involve a significant shift in workflows. Resistance may occur if the new software is challenging or aligns differently from existing workflows.
CPQ solutions streamline the process of creating business proposals. They eliminate the need for reps to hand off quotes to Revops, legal, and finance to be approved.
CPQ Basics
CPQ software streamlines and automates sales quote processes, providing salespeople with tools to configure products, calculate pricing, and generate accurate quotes that are error-free. This helps salespeople operate more efficiently and close more deals, which ultimately translates to increased revenue for the company.
To get the most out of CPQ software, businesses should understand their goals before starting the implementation process. This can help them choose the right vendor and determine if a custom-made or out-of-the-box solution is better for their business. For example, companies can specify whether to increase their quote accuracy or speed up the time it takes to create a quote. They can also define pricing rules and establish a list of add-ons to sell with their products.
Moreover, CPQ systems, as defined by CPQ system definition, aid in maintaining compliance with specific pricing and configuration rules. This implies that regardless of the salesperson’s actions, the system will only transmit the most compliant quote to the customer. This feature eradicates the risk of sending inaccurate customer quotes, thereby preventing the company from potential business losses.
CPQ systems can be connected to CRMs like Salesforce and Microsoft Dynamics to fetch data about the customer and enable automatic quote creation. It can also be integrated with your ERP to facilitate pricing calculation and provide more accurate quotes. It can even handle dynamic pricing based on demand or rate-based pricing, commonly used for service-based sales.
Pricing
CPQ software allows salespeople to personalize quotes by offering customers tailored discounts. This helps salespeople build customer relationships and close deals faster, increasing sales productivity and customer satisfaction. When a company invests in a CPQ tool, it can expect significant long-term returns.
However, implementing a CPQ system is challenging. It is essential to monitor the transition closely to deal with any issues immediately. Creating an internal team to manage the process and ensure that every user is comfortable with the new tool can be helpful. This can include representatives from every department interacting with the system, including legal, finance, and DevOps.
A CPQ system can help with various processes, from configuring products to generating quotes, ensuring that pricing is consistent and compliant with the organization’s policies. By automating these processes, companies can reduce the risk of human error and unoptimized pricing, leading to faster quote turnaround times and higher win rates for sales teams. CPQ software also collects data on product configurations that are not chosen, providing valuable insights into which options are most appealing to customers. Better product development and marketing targeting can be achieved using this data.
Configuration
After selecting a CPQ solution, you must configure it to meet your business’s needs. This includes defining how pricing should be determined, creating and configuring product bundles, setting up rules that help with quoting consistency, and implementing workflows to automate approval processes. This configuration will also include the creation of templates for quotes, proposals, and contracts. This task requires a team from several departments, including marketing and content, legal/finance, and DevOps.
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Next, you must migrate your existing data into the CPQ platform. This step ensures that your new system starts with accurate and up-to-date information. It can also allow you to analyze current processes and identify areas where CPQ can make things more efficient. For instance, you can produce a process flow chart that shows your current quote-to-cash process and then compare it to a flow chart showing how the new tool will improve that process.
Once the configuration is completed, you must train your sales team to use the system. This may involve putting together comprehensive training materials and resources that cover all the functionalities of the software. You’ll also need to provide ongoing support to encourage adoption and ensure that any questions or issues are resolved promptly. Once everyone has used the tool, you can implement the CPQ in your day-to-day operations.
Negotiation
Today’s customers are no longer interested in one-size-fits-all solutions and want to purchase personalized functionality. To do so, sales teams must be able to configure a product or service to fit specific customer specifications and budgets. This requires a process that includes the ability to specify pricing options based on these specifications and deal terms. With CPQ, this can be done in real-time and with accuracy. The result is a quote that the customer can easily understand and approve. This enables a faster, easier, and more accurate sales experience for all parties involved.
CPQ systems support the entire Quote-to-Cash sales process, from lead management and quoting to contracting, billing, and automated renewals. When evaluating a CPQ solution, look for a vendor that offers industry best practices and extensive integration capabilities. It should also provide detailed evaluations from trusted industry analysts like Gartner, Forrester, and IDC.
A CPQ system that provides your team with these features will enable them to transform from reactive to proactive sellers. They can now deliver value to customers and increase revenue for the company. By removing the chaos that results from manually sending pricing that has yet to be approved by legal or piecing quotes together from 10,000-line spreadsheets, CPQ helps companies win business at scale.
