Tech with Tacton is a series that takes a deep dive into the technical topics that impact the manufacturing industry.
In B2B manufacturing, where the buyer of the equipment is an organization, the variation in customer needs is often large, and the order volumes are relatively low. This makes efficient mass production of predefined products infeasible. Customization is necessary.
However, customization introduces complexity, since it is unclear what the company can offer and what can profitably, and accurately be delivered – with billions of potential combinations the product ca quickly become confusing.
As a consequence, almost every activity related to products in the organization becomes complex. The most obvious pains are lost sales opportunities, inefficient quoting processes, and very high costs of quality assurance but managing the product lines and after-market are equally challenging.
Most B2B manufacturing companies strive to systematize these processes by designing their products configurable to meet a vast range of customer needs. They define what product variability they offer. The core challenge then is to empower stakeholders to navigate the product variability for their needs.
For example:
- Customers: want to find out what solutions match their needs without costing too much
- Sales teams: want to quickly optimize their proposals for the customer’s needs, to win the deal without losing profits, and without getting bogged down in technical details.
- Sales engineers want to find out how to assess and overcome technical limitations for the customer without unforeseen consequences.
- The engineers: encoding the product variability needs to quickly revise and validate interdependencies when they make changes to the product line over time. Ensuring correctness and deliverability
- Product managers: need to optimize the variability for profitability. Which customer needs are compatible, which component variants are rarely used? What happens to the overall variability if we replace or remove this component variant?
- Pricing managers: need to balance margins with customer value and cost
Each of these tasks is daunting when we look closely, and they are all very different.
Interdependencies always make it necessary for all parts to be compatible. Configure, Price, Quote (CPQ) technology can be your versatile autopilot when it comes to navigating your product variability.