CPQ can help you catch lightning in a bottle.
How many times have you seen a sale come in and found that the rep did everything exactly right? They found the customer based on your qualifying characteristics, they approached the prospect using the prescribed method and they followed the selling script down to the letter. The customer, almost following a script themselves, responded to the pitch and eagerly asked for a proposal.
You ask yourself, why can’t all deals come in like this? Why do some deals flounder around for months or longer, sometimes just dying of old age, while others seem to close by themselves?
Wouldn’t it be great if your winning sales process could be replicated and repeated at will?
What makes the difference? Why are some reps always bringing in deals while others never bring in deals? Why do some sales organizations rack up huge numbers every year while others struggle to hit their quotas?
Let’s take a look at some characteristics that are commonly found in these winning operations.
Best-in-Class Sales Operations
Most selling organizations confront challenges; the difference is how they address those challenges. Common factors found in winning organizations include the following:
They Set a High Expectations Bar
No one ever got better trying to stay the same. Great sales teams are always up to the challenge to do better. Last year was last year, and last month was last month—the new month means new goals and new expectations.
Adept at separating signal from noise
This simply means they are able to distinguish between distracting minutia and important detail. This is critical when discussing complex products or requirements with prospects. Time is too valuable to waste chasing meaningless phantom issues while important questions remain unanswered.
Never too proud to borrow
Originality is overrated in many activities, and sales is one of them. Finding a winning formula or new technique is a gift. If it works, use it.
Focus on sales enablement
Organizations have a bad habit of developing imaginary requirements that do nothing but frustrate people and prevent positive outcomes. Winning teams look for ways to cut out redundant processes and imaginary requirements. They look for ways to make it easier for the rep to get the job done.
Performance-enhancing organization structure
When organizations are designed to placate individual egos or to preserve the “way we’ve always done it,” they end up getting in their own way. Organizations should be designed to encourage and promote their own success.
Exploit technology effectively
We do live in a technological society, and harnessing technology effectively is critical to ensuring that everyone on the delivery team is equipped to maximize success.
How does technology play into the successful selling organization and winning sales rep? It is critical. You can nail every other best practice and still fail if you drop the ball on technology. Let’s take a look.
Getting the Technology Right
Businesses acquire systems to solve problems. They deploy software packages and process improvement teams, and they expect problems to just melt away. They expect things to just start running better, faster and cheaper.
It doesn’t work that way.
The technological pillars one sees within most selling organizations include CRM, portals, ERP and marketing automation. These are all powerful tools or systems that have the potential to deliver huge value to the user organization and to the customer as well.
But, they are too frequently implemented and operate within an operational silo that is meant to insulate them from external corruption. The unfortunate effect of this is to insulate those users with the most need from the very benefits these systems are designed to deliver.
It doesn’t have to be that way. Adding an effective configure-price-quote (CPQ) solution to your technological portfolio has the effect of bringing all of the benefits from your assorted system to bear precisely when and where those benefits are needed.
Here’s how it works.
CPQ and CRM
CRM provides a warehouse of data about existing customers as well as prospects. This data can be manipulated to isolate all manner of classes of customers and prospects. Factors such as location, industry type, organization size or annual revenue are encoded and associated with each member record in the system. This facilitates building prospecting or campaign lists.
CPQ supplies data that enhances this intelligence far beyond the high-level data provided by CRM. For example, what customers have which specific products, configuration data on those products that reflect environmental or usage information and those options they NOT have purchased can be identified. This type of information provides the ability to identify cross- and upsell opportunities.
Pricing history also delivers intelligence about pricing sensitivity across both specific markets and also for individual customers. This data is useful to individual salespeople and also to product managers and marketing people.
CPQ and Portals
Nothing says we make it easy to buy like a well-designed customer portal. High-value content can be channeled through the portal that is closely aligned to the prospect and customer’s needs and interests. Couple that with an e-commerce solution and integrated CPQ, and you have a facility that puts selling into an automated self-service mode.
CPQ scripting drives customer-interaction question and answer processes that allow CPQ to make selections for the customer that do not include irrelevant or inappropriate choices and do include option selections that specifically align with the customer’s needs. This technology is so sophisticated that the interview process will teach the customer about usage issues and factors that they may well have been totally unaware of.
CPQ puts a virtual sales rep into your portal and e-commerce functionality.
CPQ and ERP
ERP is so big and it does so much, that any discussion of ERP runs the “boil the ocean” risk. However, for most companies, ERP is perceived as a financial reporting system, inventory or supply chain management system or a production scheduling and control system. Most ERP systems on the market started off within one of those functional domains.
ERP is all about data. It has a rapacious appetite for data and also produces prodigious amounts of data. This will not change in the future except the volume of data involved will undoubtedly become larger and larger.
CPQ data will make meaningful contributions to this data in many forms. For financial reporting, pricing data related to transactions and proposals is useful for measuring pricing validity and market strength for specific products and markets.
CPQ can provide the earliest possible triggers for supply and part purchases in a demand-driven system by the use of probabilities and part quotation inquiries. This gives your inventory and supply chain much longer-range headlights than just running off an order management system.
The same is true for production scheduling. Early warning for production slots and resource allotment reduces surprises and delays on the shop floor. This means your customer will be assured of delivery as promised with greater frequency than running on ERP alone.
CPQ and marketing automation – Integrating marketing automation with CRM is a no-brainer. Bringing CPQ into that equation is the next logical step.
Marketing automation is all about metrics and locating opportunity based on data. CPQ creates data related to inquiry, customer need, acceptance, and rejection thresholds related to price and other options. Additionally, usage data that is driven by option selection and environmental requirements are produced as inquiries turn into orders through the interview process.
CPQ delivers this type of high-value data into the marketing system to facilitate precision campaign list creation and enhance market-research data.
The Importance of CPQ to the Whole Organization
CPQ is emerging from the status of being a “sales tool” for sales reps to being part of the overall integration of systems, processes, and data vital to the selling organization.
Witness to this emergence is found in the Aberdeen report of July 2016 that details how CPQ cuts costs. This report gives the reader an excellent framework to see what a best-in-class CPQ deployment accomplishes for the selling organization.
- CPQ users experience high revenue growth
- CPQ drives higher profit percentage
- CPQ users experience lower turnover in their sales ranks
- CPQ makes your selling organization more efficient with lower headcount and faster training cycles
The report is well worth the time invested for planners who are looking for ways to turn their sales force into a more efficient revenue machine.
CPQ literally does allow the organization to replicate and standardize a selling process that has a much higher success rate and more effective management potential via the metrics delivered by the system.
CPQ delivers lightning in a bottle.
Lou Washington is a blogger and senior writer for Cincom Systems, a provider of CPQ, CCM, and other business technology solutions. Lou draws on his combined 45 years of manufacturing and business technology experience to offer businesses insight into improving their most critical processes.