In 1847, inventor Werner von Siemens developed the pointer telegraph and followed up in 1866 with a prototype for the dynamo. Today, the company he founded is a household name and Europe’s largest electronics and engineering company. Siemens is also the world’s leading supplier of energy technology.
While renewable energy resources are becoming increasingly important. With pioneering technology, Siemens gas and steam turbines make sure that we can produce this energy in the cleanest, most efficient way possible. But while Siemens leads the way in sustainable energy production, producing customer quotes for its gas turbine units wasn’t such a smooth process.
A complex problem required an innovative solution
The turbines are extremely complex pieces of equipment. Each sits within a wider power plant solution which is tailored to each customer’s unique specifications and site conditions. The air intake assembly alone, for example, has 120 variants. Factor in all the configurations and combinations that come along with that; and things get complicated very quickly.
This complexity posed a challenge for Siemens. Because the turbines are highly customized – and the combination of variables almost endless – producing customer quotes was a lengthy and complicated process. A full customer proposal was often 500 pages long, took eight weeks to produce, and required specialist engineering help on almost every sales case. Siemens wanted to simplify this process. They realized that streamlining product configuration and quote production would save both time and money, and give the company a competitive edge. What they didn’t realize, was just how dramatic the results would be.
With the Tacton CPQ, Siemens quickly saw that they could streamline by creating pre-made assemblies, including standardizing much of the core turbine engine. Simplifying the product architecture in this way has reduced demands on engineering. As Åsa Johansson, who is responsible for global coordination of the Tacton project at Siemens explains, “In our previous system, we had thousands of business rules. Using Tacton’s system, we now have just a few hundred and this has made system maintenance so much easier”.
Sales reps can produce accurate quotes on the fly
The technology also means that the sales team can now configure turbines during customer meetings. Sales reps only need to address the parameters that the customer wants to customize – the configurator automatically optimizes the rest of the assembly. The results Siemens have seen are dramatic. Where it previously took eight weeks to produce a customer quotation, sales reps can now produce accurate, high-quality quotes, with pricing, in a matter of minutes. And product specialists are now only required on the most complex cases.
Jan Nilsson, Senior Engineer CRM Process & IT Development at Siemens explains, “The beauty of the Tacton is that it will guide the sales rep through the sale and get the configuration of the product and quotation correct each time. “It now takes us only five minutes to generate a complete budget offer including pricing. This saves us tremendous amounts of time and money.”
The sales team can now focus on customer relationships and finding new business opportunities, instead of spending weeks chasing product specialists and putting together proposals. While engineers can concentrate on R&D and on supporting the really complex sales cases. Shorter sales cycles mean Siemens has the capacity to engage in more sales cases. And the company is producing accurate quotes in a fraction of the time it generally takes the competition.
And the benefits don’t end there
Regular maintenance and upgrading of parts are essential to helping the turbines run as efficiently as possible. These aftersales services are a critical revenue stream for Siemens. They are also an important cost control factor for the customer – as the more efficiently the turbines operate, the cheaper they are to run. With the Tacton system, the sales team now has insight into where and how they should offer maintenance contracts – while they are specifying the turbine with the customer. The system only prompts service options that are relevant to the particular configuration the customer is ordering. As a result, Siemens has been more successful in selling after-market services.
Sustainable manufacturing with CPQ is an integral way to understand your products better while combating waste
Manufacturers alone contribute over 12% of the total CO2 emissions across the globe yearly. This number is raising global awareness and creating urgency to find ways to become more sustainable either by company choice or by government mandates. With these global imperatives, many corporations are searching for and investing in sustainable technologies.
Configure, Price, Quote (CPQ) solutions are a big part of many companies’ sustainability practices. Being able to provide digital transformative efforts can reduce waste, keep lean manufacturing goals, and more. At Tacton we’ve built our CPQ system to incorporate the environmental impact into our configuration process. While we recognize we have a long way to go to combat climate change, a meaningful digital strategy powered by CPQ is an integral part of that process.
Recently we had a chance to talk with Patrice Arnera, our Director of Sales EMEA and Japan about the shift to sustainable practices across the different industries. Patrice has worked with Tacton since 2017 and enjoys seeing companies transform their digital experience and create business value throughout the process.
Let’s start with an easy one: What is sustainable manufacturing?
Sustainable manufacturing is a way of making products that minimize negative environmental impact, conserves energy, and resources. It also considers the employees, communities and buyers the product effects. This can come from optimizing the product and lifecycle management leading to a smaller environmental footprint and social benefits.
How have you seen manufacturers evolve to more sustainable practices over the years?
Sustainable practices have been, and productions have been building over the past decade or so in some industries. Consumers probably noticed this first in their everyday purchases of environmentally friendly products such as hand soaps, clothing, and packaging.
This topic quickly began taking hold in more industrial areas such as manufacturing as it became clear that the environment was changing at a rapid pace. Reducing harmful emissions while making products and helping employees and the community around the site and globally has made manufacturers rethink their efforts.
What are the objectives and targets of your sustainability and CPQ efforts, and that manufacturers are setting?
A few common ones discussed are items like these:
Reducing the carbon footprint is to reduce carbon dioxide emissions, which contribute to global warming
Responsible consumption, using resources and energy efficiently
Sustainable innovation, better known as using innovation to achieve sustainabilitygoals
How does CPQ help manufacturers become more sustainable?
CPQ in general is a way to put together a valid configuration with approved pricing using a combination of rules and workflow.
Tacton CPQ is a unique solution in the CPQ spaceas it allows users to optimize the configuration of ecofriendly products without compromising the needs of the customer by giving them a full picture of the impact any product will have once it rolls off the production line.
CPQ also enables manufacturers to offer an optimized product that is in line with local regulations on emissions and other sustainability demands in their specific region. With CPQ it’s even possible to allow faster product introductions that are aligned with a changing market.
What canCPQ play in your manufacturer’soverall strategic plans?
Again, in general terms, CPQ will bring efficiency gains in the sales process and will result in much lower costs of sales and higher win rates for its adopters. Here I would like to focus on some of the Tacton specific benefits made possible by its unique combination ofconstraint-based configuration and its solver technology.
Tacton CPQ finds its strength in optimizing the configured products around the end customer-specific needs rather than just being a validator of technical combinations. As such, it is helping manufacturers make and deliver what their customers really need at optimized costs, price, margins, speed, and resource consumption.
CPQ is also a key accelerator in the new product Introduction or new variance introduction process which plays a major role in being first to market and or being able to react to competition, regulations, and market changes.
What business value have manufacturers seen from their sustainability efforts?
When we apply Tacton’s unique features to manufacturers’ sustainability efforts, manufacturers can track certain parameters such as resource consumption and materials to ensure the most sustainable options are provided during the configuration process around the criteria that really matter for their end customers.
By showing such responsibility, manufacturers have also observed some “soft” benefits such as more demand as customers are more and more looking to work with responsible organizations.Constraints and data management also provides a much faster time to market for manufacturers using CPQ which allows them to better adapt to regulatory changes and innovation which again will translate into a larger volume of sales and a reduction in sales lead time.
Describe a customer who has used sustainable manufacturing and CPQ to reduce their environmental footprint?
One of our customers, Plus Pack has been on a century-long transformational journey. Founded in 1914, this Danish pioneer in the food packaging industry has been supplying its customers with innovative and sustainable solutions that help them stand out.
With CPQ and sustainability in mind, Plus Pack’s digital strategy centered around CPQ. To deliver 100% recyclable products with zero CO2. With CPQ’s needs-based configuration, Plus Pack finds it easier to offer its customers more sustainable packaging solutions supporting a circular economy. Plus Pack’s sales teams can easily compare different packaging options and to recommend customers the most sustainable materials that are fit-for-purpose as well as fit-for-future.
Change is coming for manufacturing across the globe. As new environmental requirements from local governments roll out, as well as demands for sustainability from communities and employees manufacturers must take notice. Creating sustainable products and reducing waste is possible using CPQ to ensure every requirement is met before even making a product. Schedule your personalized demo today to learn more about CPQ and sustainbility.
The product leader for Motorola’s video security offering discusses the manufacturer’s ongoing adventure into e-commerce.
The past year dramatically impacted how manufacturers successfully engaged with customers, especially as more interactions went virtual. While video collaboration placed a meaningful role, the ability to roll out robust e-commerce offerings also ensured continued feasibility for manufacturers.
Fahad Mahboob, product owner, of digital enterprise systems, video security, and analytics with Motorola Solutions Inc. recently discussed the role e-commerce played in helping meet customer expectations within an uncertain and ever-evolving environment.
IW: As a manufacturer of security solutions, what drove you to embrace e-commerce?
Mahboob: Enterprise-level security solutions such as the ones Pelco provides require multiple interconnected components to perform together. Designing these solutions, iterating them during the design phase, and adapting to the changing needs of customers was something that our sales teams and partners struggled with. With multiple product lines and model number combinations, designing these systems is time-consuming for even the most experienced designers.
The security industry, in general, has not tackled this well, and our customer experience focus group decided that we owed it to our partners to create a better configuration, pricing, and quoting experience. We argued that a more intelligent and automated approach to system design would help reduce design time, design iterations would take minutes compared to hours. And by allowing the configurator to be available to all partners, it would empower partners to see what is possible with an integrated system design. We know that a better user experience is great for customer retention and profitability, not only in the B2C world but increasingly more in B2B as the same users expect more from B2B platforms now.
Today our e-commerce platform, built on Tacton CPQ, allows the configuration of integrated systems. It shifts through 1000’s of system combinations in seconds to pick the most efficient system design. It manages pricing, approval flows and creates documentation complete with technical calculations and product images in a few clicks. We have managed to squeeze a one- or two-hour design process into a 15-minute guided selling approach that anyone with minimal understanding of security systems can manage.
IW: What challenges have you faced?
Mahboob: On the data side, making sure that product information, product configuration rules, pricing complexity, and approval structures are defined in a way that they can be ported to a single system took time. All these processes existed before but were spread across multiple internal systems and were not designed to be customer-facing. On the adoption side, we saw a trend where new users were loving the simplicity and speed of the e-commerce portal, but seasoned users continued to use the existing excel sheets and other out-of-band systems because they could manage fringe design cases through a more manual process. We are still on a journey to include multiple fringe use cases into the e-commerce portal but have come a long way since going live in June 2020.
IW: What were the keys to overcoming the challenges?
Mahboob: For tackling data complexity, it’s important to assemble a small team that has insider knowledge of these systems and is able to get the processes and data flows mapped out early on before the build starts. Once this is established, execution becomes a lot easier. We did multiple User testing sessions and recruited enthusiastic supporters. The feedback helped us to improve, and in some cases completely redesign parts of the experience. That helped us with the adoption because these early users helped to spread the word. The product owner communicated aggressively across our global organization on the merits of the system, participated in demos, and captured feedback. Communication is always the key, or many well-intentioned initiatives can fizzle out quickly.
IW: How has having an e-commerce presence impacted your manufacturing operations?
Mahboob: We started to see product attachment rates increase across all our product lines. The e-commerce configuration tool was the killer feature, it allowed users to create a complete system, tweak the different parameters to optimize the solutions for price and performance, and do all that in minutes from a single platform. We were exceeding attachment rate KPI’s by 3 folds within 6 months of launch.
IW: How do you see your e-commerce endeavor continuing to evolve?
Mahboob: We have plans to add more capabilities including multi-lingual support and product schematics. We have started to create very detailed proposal documents that allow customers to visualize and really understand the solution in a way that gives us a competitive advantage.
Who uses CPQ? This is a question that gets asked a lot more and more these days as Configure, Price, Quote solutions become the norm for many manufacturers
Many manufacturers have started their digital transformation journeys and defining their CPQ users has become an integral part of their success. Many companies begin their engineering and sales team as the initial CPQ users, but did you know that it’s possible to extend the solution to different departments of your business? Let’s take a look at some unexpected beneficiaries of CPQ.
CPQ Users 1: Sales
The rapid shift to online buying and selling has been a bumpy ride for some manufacturers. Without CPQ your sales team has to use manual processes to create the custom, complex products your customer wants. This manual process leads to long response times, inaccurate quotes, and an unhappy customer. This doesn’t even account for the high costs of training new sales reps on an increasingly complex product catalog. Often times customers are looking for a more visual experience, that isn’t offered in many sales pitches by manufacturers.
All of those challenges for the sales organization can be solved with CPQ. It’s possible to connect every process together for a streamlined buying experience ensuring that sales always delivers the right quotes and sells a deliverable product. Even your newest sales rep with the help of guided selling can quickly become an expert on the product because CPQ creates only accurate products and even CAD drawings to show customers. Enhancing the customer experience is possible with visualization that shows the final product in the real-world environment where it will be placed.
Understanding the manufacturing brand and connecting customers to create a profitable pipeline for sales isn’t always an easy task for the marketing team at manufacturing companies. With an online and high-touch buying journey for customers. Meeting these customers with a personalized experience for a great experience is the goal. This turns into high-quality leads for the sales team. But how can manufacturing go from B2B to a B2C experience?
That’s right, CPQ with visualization extends the custom product configuration to customers directly from a manufacturers’ website. Just like Nike does with their custom shoes, manufacturers are beginning to do with their products. Now that customers have the stunning, and accurate visual of their product it’s critical to capitalize on their interest. Self-service is another important aspect of marketing. With self-service customers will be able to start the process of buying a product, that is actually configurable, before even talking with the sales team. This may sound not so great for your sales team, but capturing interest via self-service will help sell to an existing or new customer while allowing more time to deal with bigger accounts.
With so much back and forth between engineering and sales on product specs, technical requirements, and more it’s important to try and streamline this process to enable engineers to work on creating innovative products instead of time-consuming administrative tasks. This doesn’t even account for the management of seemingly infinite product variations that need multiple systems to manage the data.
Streamlining and digitalizing these commercial, engineering, and factory processes with CPQ gives the users one source of data truth. That’s because CAD automation enables engineering and sales to deliver product specifications that can actually be produced. Being able to quickly and effectively solve technical product variance challenges using accurate product data and analytics can be another added bonus of CPQ.
Check out how CAD automation is helping sales and engineering streamline the sales process
CPQ User 4: The project lead
Identifying the challenges of a digital transformation journey with CPQ requires your digital team to understand the current business challenges, define a clear problem, desired outcome and the time to value. This means managing stakeholders such as marketing, sales, and engineering while navigating the project.
This means reinventing and future-proofing the operation from customer experience to the back office operations for deliverable solutions. Being able to gain a complete understanding of the challenges and articulate them across the organization will enable a fully cross-functional team that utilized CPQ in an optimized way
CPQ User 5: The information and technology teams
Understanding the relationship between operational, informational, IoT, cloud, marketing, sales, and analytic technologies and the importance of strong integrations is critical to a successful CPQ project. Setting the proper strategy and ensuring the right tech is used and adopted throughout the business is a challenge that the IT and tech teams face.
With powerful integration capabilities, CPQ is able to work with any CRM, ERP, PIM, PLM, CAD and eCommerce solutions on the market. These integrations streamline the process for every part of the organization ensuring everyone from sales to factory is working with reliable software.
The more CPQ users the better
To sum it up, the more CPQ is used across the organization the more complete and exciting the journey will be for your customer. Tacton CPQ extends past the typical use of CPQ for just sales or engineering. This value to marketing, project management, IT, and tech will help create full buy-in from the team. Ready to learn more about our holistic digital transformation efforts? Book your custom demo with us today!
Lessons on business benefits, productivity, developing a customer-centric buying strategy and more from Leaders at nVent and Tacton
nVent is a global leader in enclosures, electric heat-tracing solutions, complete heat management systems and electrical and fastening solutions. nVent products connect and protect customers’ systems in facilities where the cost of failure is very high. nVent helps customers enhance productivity and reduce their cost of ownership by simplifying installation and minimizing downtime during operation. Looking to develop a customer-centric digital strategy was an important factor in choosing new solutions.
As a truly global company with over 80 locations, and 9,000 employees, nVent was searching for tools that would enable its distribution partners and manufacturing reps to quickly sell their products from anywhere. nVent suffered from long response times to RFQs, had significant high training costs and errors in hand over to their supply partners. Working with global product models posed a difficult challenge for phasing out products. These challenges lead nVent to a search for a solution that would offer customers a convincing digital experience while also streamline the quote and sales processes of their products.
The search lead nVent to CPQ and Guided Selling software from Tacton. Using CPQ, nVent was able to support growth while also increasing productivity by creating centralized product models for global governance. Enable instant pricing so customers and sales were able to see a faster response time from the pricing team. Increase productivity by avoiding human error and rework. Reduce cost by moving to cloud-based tools with lower IT costs.
“We have chosen to work with global product models, but we can actually switch things on or off. So we can really recognize our global product models. Because we control the product model globally we control what products we put on high priority. Guided Selling is key. We’re using a product constraint to make sure the selections are actually feasible. So, if you’re really good at guided selling, and you’re really good at managing your product constraints your whole organization will become experts. We also have really good pricing automation with faster times, and fewer manual interventions” – Alexander van der Weide, VP of Marketing for Electrical Enclosures, nVent
Learn more about how Tacton can help you achieve a truly customer-centric buying journey in a personalized demo.
It can be scary to embrace CPQ integrations, but now is the time to start the journey
When I speak with our customers, the terms ‘smooth integrations’ and ‘powerful integrations’ get mentioned frequently. In a lot of cases, I can almost hear a tremble in their voice when they say it because they’re unsure if it’s possible or even okay to mention. After years and years of homegrown, on-prem, and software implementations– often coming from multiple acquisitions and various initiatives from different business units, many global organizations have had failed integration projects.
We all know that customers’ expectations have evolved to a point where they want to research and shop anywhere, anytime, and through any channel. Meeting the expectations requires personalized buying experiences that aren’t possible without connecting systems to leverage data and analytics. Digital business models are not a luxury, they are a necessity. For any business to be successful, they must embrace integrations to connect the front, middle, and back-office systems. The good news is that it doesn’t need to scare you– it should excite you.
Over the last decade, we have seen an epic shift from on-premise to cloud SaaS solutions as digital transformations have played out. As more and more enterprise organizations implement transformative technologies, the promise of automating workflows and delivering on customer experience can appear unkempt. This is where the power of integrations must be leveraged to connect your systems and create a single view of data that enables you to connect your processes and systems in a meaningful way. When properly integrating systems, you can quickly and easily leverage data from all your sources.
Integrations are the key component to accelerating innovation, automating manual processes, meeting customer expectations, and creating a truly data-driven ecosystem. When I speak with our customers, this is the end game of their digital transformation. And the digital transformation efforts have accelerated rapidly in the past year. It doesn’t matter the industry or vertical– they all say the same thing: we’ve made investments to transform our processes, we have an abundance of data from all our systems but aren’t sure if they are leveraging it properly for our own efficiency and truly delivering to our customers.
Just how fast has digital transformation accelerated in the past year? Check out this and more in our recent manufacturing survey!
There is so much data from so many systems, how can we harness it?
The wealth of data across these investments is absolutely critical to operating at an optimal level and delivering an industry-leading customer experience. If you don’t connect all of these critical systems, you will continue to be disconnected from department and data silos. You will continue to be removed from your customers as they interact through your partners, online, and in a direct manner.
This is where Configure, Price, Quote (CPQ) software fits in. There is no way to sell highly customized products across channels without CPQ.We all know selling highly customized products is essential to your business model. If you do not connect your digital investments with the right CPQ software, you will continue to be disjointed and struggle to connect your end-to-end process… and of course, deliver on customer experience.
By implementing a CPQ integrated into your business-critical systems, you ensure your customers, sales, and partners are empowered to generate accurate quotes when selling hardware, software, services, and add-on accessories. Thanks to Guided Selling, CPQ enables anyone, with or without technical knowledge, to experience a data-driven experience in configuring customized products with 100% accuracy.
Discover how CPQ is helping leading manufacturers such as Plus Pack and nVent take their transformation efforts to the next level in our upcoming summit!
Empower your customers through self-service channels
The benefit to extending this fully integrated solution to your customers means they can begin the configuration process online through your website. With the proper CPQ, you can often make the product, configuration recommendations, and add-on recommendations– all based on the data you have collected and turned into meaningful intelligence. With CPQ integrated into your website, you ensure you give your customers the self-service channel they want while ensuring your most complicated sales come into your teams as a hot lead.
Extend your sales tools to your partner network for additional growth
Most of our customers and many other global manufacturers have partners and distributors that are essential to their business model. The downside is many do not have the business capabilities to invest in tools and rely heavily on the manufacturers they are selling for. With CPQ, you can extend the same tools and data out to your partner network and give yourself the ability to get closer to your customers. Additionally, we know any partner salesperson is going to go the path of least resistance when selling products. If yours is quick, easy, and positioned to deliver what their customer needs– they’ll likely choose you.
Enable the data-driven decision making you need to be efficient, govern your product offering, and increase your top-line growth
Whether your goal is supply chain optimization, governing your product offering, extending tools to partners and customers, making product recommendations in the configuration process, or increasing add-on sales, embracing CPQ integrations is the only way you can gather the data needed to make intelligent and meaningful actions.Check out the importance of a multidimensional approach to digital transformation is critical. Focusing on internal processes can lead to a better customer experience.
When integrating CPQ at the center of your business operations, you can truly become customer-centric and build the intelligent business model that was the initial promise of your digital transformation and Industry 4. So, let’s all agree, it’s time to stop fearing integrations and start embracing them!
Tacton has a history of embracing CPQ integrations to business-critical systems
Tacton has a robust team of integration specialists that have over 20 years of integration into the most complex systems including on-prem, homegrown, and software. We work with the top manufacturers in the world to put CPQ at the center of their selling process to ensure they have the data and intelligence to optimize their operations, build sustainable growth, and get closer to their customers. We’re not afraid to say we can integrate into anything
CPQ and Sustainability a major driver for success at Plus Pack
Plus Pack has been on a century-long transformational journey. Founded in 1914, this Danish pioneer in the food packaging industry has been supplying its customers with innovative and sustainable solutions that help them stand out.
The latest step of their success story – 100 years in the making – has been a digital transformation project with a focus on customer-centric product customization.
“Our first step in our digitalization journey was to replace our legacy ERP system with a new ERP platform. This project ran between 2016-17, which was the foundation for us to build on. Later in 2018, we revisited our digitalization roadmap and looked for ways to increase the revenue and experience for our customers, while improving our operational efficiency.” – Bastian Fietje, Head of Groups Projects at Plus Pack.
What follows is a closer look at how Plus Pack, in a quest to support their customers into the future, lead them to adopt Tacton CPQ as the key component of their digital strategy.
Partnering with Customers to deliver a superior customer experience
Plus Pack’s product line consists of food containers and trays used in the food industry with a focus on convenient meal products, take-away, and ready meals. Its customers are international companies – either food producers, retailers, or distribution companies and each day 4 million meals are served in a packaging solution from Plus Pack. In recent years, consumer behavior and environmental awareness have driven the demand for sustainable packaging solutions in materials that are easy-to-recycle supporting a circular economy.
As a result, Plus Pack not only needed to deliver quality products but also, needed to collaborate closely with suppliers, customers, and stakeholders to develop sustainable food packaging solutions. Plus Pack’s unique positioning, as both designer and manufacturer, means that they have the expertise to lead their customers through this experience-focused approach to packaging development and -innovation.
Partnering with customers to provide customized solutions is nothing new to Plus Pack, “Our most established customers would come to us to revisit the product, and together we would look at what their next move would be, how to lower their costs, improve their sustainability performance and even increase their sales” clarified Bastian. It was vital for Plus Pack that their digital strategy complemented and supported their established customer partnership strategy.
Join us and Bastian Fietje, Manager of Group Projects & IT, at Plus pack for our annual Smart Commerce Summit on May 6th, 2021!
Customization as a Growth Strategy
Plus Pack’s approach to digitalization and product customization was in part, based on pioneering research from the Technical University of Denmark. Lead by Prof. Lars Hvam Ph.D., the research demonstrated how manufacturers that implemented a Product Configuration Software, like Configure, Price, Quote (CPQ). “have achieved numerous benefits such as better decision-making capabilities, more on-time deliveries, improved product quality, less rework and increased customer satisfaction”.
For Plus Pack, CPQ was the tool that would enable them to achieve their vision of becoming “The preferred partner for customized and sustainable packaging solutions”. “For us at Plus Pack, we needed a tool that would not only allow us to implement a partnership strategy with our customers but also that would allow our production to run more efficiently and to ensure that we can deliver exactly what was promised,” stated Bastian.
Thomas Bangsgaard Vestergaard, Sales Configuration Project Manager overseeing the CPQ implementation says, “We have thousands of products and variables to account for that require highly technical calculations. With CPQ our sales teams could interpret the needs of the customer and quickly identify which solutions within our entire product line best met those needs.”
Plus Pack’s plans to grow within an already competitive market are partly based on their ability to deliver a faster, flexible, more accurate, and superior buying experience for their customers. “With CPQ, within a few minutes, we are able to deliver a highly technical quote, with the price and supporting documents for the quote. In the past, this was a process that would take days if not weeks”, says Thomas.
With CPQ and sustainability in mind, Plus Pack’s digital strategy could be achieved. To deliver 100% recyclable products with zero CO2. With CPQ’s needs-based configuration, Plus Pack will find it easier to offer its customers more sustainable packaging solutions supporting a circular economy. Plus Pack’s sales teams will be able to easily compare different packaging options and to recommend customers the most sustainable materials that are fit-for-purpose as well as fit-for-future.
Abandoning Silos and Embracing CPQ and Sustainability
While CPQ is described primarily as a sales tool, it carries many additional benefits, especially for a manufacturer like Plus Pack. When it comes to high-variant sales configuration, CPQ not only positively impacts the buying process, it also harmonizes the way product engineers and project managers collaborate. Manufacturers traditionally had to effectively manage the interest between 3 core areas: Sales, Product, and Factory. These areas tended to work independently, and at times tensions would arise when sales lacked the latest product information, or sold an impossible configuration, or even quoted the wrong price.
With CPQ, these tensions are eliminated because CPQ ensures that each sales configuration takes into account all aspects of manufacturing. CPQ can, therefore, ensure that the quote generated by sales is feasible, error-free, with the correct price, and that the production needs are also accounted for.
“CPQ gives our sales teams access to our entire product line, and they are able to come up with new innovative solutions for our customers, based on reliable product information. Project managers and those overseeing the production trust that they can deliver what was promised to the customer”, concludes Bastian Fietje.
CPQ can also be a source of unique product data with the integrations of the Analytics API. With this new source of data, Plus Pack’s business analysts and project managers can better understand more about each customer order and identify new commercial opportunities, as well as explore product improvements.
Not familiar with CPQ tools? A starting point for digital transformation:
Configure Price Quote (CPQ) tools help manufacturers sell highly configurable products faster and more efficiently. Whether it be direct, partner, or extended online as a customer self-service sales tool, guided (and remote) selling enable anyone to accurately configure complex products and services for prospective customers. CPQ tools help manufacturers ensure correct pricing, deliver personalized and highly customized quotes, and massively reduce the time it takes a salesperson to create a proposal using spreadsheets or other homegrown tools. So Where does CPQ fit into your system architecture? Manufacturers who choose to implement CPQ tools as part of their digital transformation strategy often find themselves asking how they can fit a new solution in an already existing framework of Customer Relation Management (CRM), Enterprise Resource Planning (ERP), and even eCommerce solutions. A system landscape is a bit like a puzzle that without a clear framework can seem difficult to solve, but once every piece is put correctly into place can be something organizations can see results from quickly. With the massive shift due to COVID-19 manufacturers have learned just how critical it is to find products that can transform operations and work seamlessly within existing business-critical systems.
Fit the pieces together
Creating a harmonious landscape is easier said than done. Without proper thought about how the pieces fit together adopting CPQ tools can become a fools’ errand. That’s why defining how each piece of the landscape puzzle will fit together can give answers to use which product and when. When implemented in your tech stack, CPQ provides the single source of data truth for the entire organization to operate on, regardless of the system they use. While CPQ is the foundational component for manufacturers to sell configurable products, it’s the integrations into the front and back-office systems that truly enable operational efficiency and a seamless customer experience.
The shift from B2B to B2C requires eCommerce for manufacturers
Manufacturers have long created a B2B experience for their customers, focusing on product logic and its features. While this has worked in the past with the analytical buyer focusing on the core competencies of the product. This leads to a long, slow buying journey that would take time to complete a purchase. The rise of companies like Amazon has made customers less likely to wait for satisfaction, they want to know the benefits of your products in seconds, not days or weeks. B2B customers are behaving like B2C customers meaning they want products fast, accurately, visually, and across channels. They refuse to wait for your long sales pitch. Even after the purchase, to keep customers coming back manufacturers must give an excellent omnichannel eCommerce experience.
CPQ is a simple way to execute your eCommerce journey. Embedding a product configurator with visualization right on your website will show how simple and easy it is to get their manufacturing product, no matter the complexity. This is a chance to win on two fronts in the battle for customer engagement. First, customers can configure their product down to the smallest detail without the help of your sales team then request a quote or add to the shopping cart using self-service integrations to buy from anywhere. Self-service creates a shortcut for your customers. Giving both customer and seller a head start on configuration makes the negotiation process easier. This information will be quickly relayed to your CRM systems. Using a CPQ system integrated into an eCommerce platform puts the power of product configuration in the hands of customers, it’s only the beginning of a seamless connected journey.
Driving leads with CRM
From Salesforce to Microsoft Dynamics, CRM systems are the first step in creating a centralized customer experience in manufacturing. Your sales team and marketing team is always hard at work driving leads that can be used to build segmented target audiences. The audiences become relationships that are nurtured and analyzed by creating a robust tracking system.
Once these prospects become interested in your product, they usually always ask for an RFP (request for proposal) based on their product portfolio and provided data.
Often enterprise manufacturers can be slow to adopt digital tools or even know where to start. A CRM is necessary for managing leads, opportunities, and customer contact, but it does not have the functionality required for managing the complex, customized products and services manufacturers sell.
While CRM transforms the way a company sells, a CPQ tool integrated with CRM is required for efficiently selling configurable products. In fact, the recommendation for companies selling industrial products is to implement both at the same time if possible. This avoids the challenges of changing the selling process multiple times within a digital transformation.
Sub-workflow solutioning with CPQ
Now that you’ve passed the first test of getting a customer excited about your product and they give you data to create products it’s important to utilize a CPQ tool to get a quote quickly back to the customer.
Before CPQ it would take days and weeks of back and forth between your sales and engineering teams to create a first quote, let alone an accurate one. CPQ is easy enough to use that anyone can create an accurate foundation for a customer quote. The solutioning is done in a way inside the CPQ tool to create the optimal product based on the needs of the customer. Optimizing a quote for a customer can seem difficult, but it’s easier than ever to do this using guided selling that reviews every answer given and gives them only products that are fully optimized to their needs. Guided selling enables anyone to generate a quote based only on needs and requires no technical knowledge.
Once you and your customer have agreed to a configuration with a customer, it’s even possible to create dynamic proposals with CPQ. This proposal can be uploaded prior to reflect your branding or even a configuration that’s been proposed and accepted before.
Creating these quotes opens a dialogue with customers that have been difficult in the past. Manufacturing customers have had to go through incorrect quotes, spreadsheets, and text-based descriptions to get a final product. CPQ can go beyond an initial configuration and quote. Showing them how the product will look with realistic visual configuration ensures your customer, sales, and engineering teams are all aligned based on the expectations of products while reducing costly miscommunications.
These quotes can include custom CAD drawings directly from Design Automation. This can be done even without involvement from your CAD engineers with a connection directly from CPQ. Ensure detailed 2D and 3D designs of configured products straight from your CAD system. Reducing order errors, automatically generating configuration-specific drawings will keep the front of the house and back of the house happy.
More on CAD
CPQ and CAD automation work together by providing knowledge from your engineering team to your sales without having to go through constant meetings and emails. This happens by codeveloping product logic between your engineers and CPQ. Codifying product logic and validating it with info from CPQ.
This enables your sales rep to sell what your engineers can create because it was co-developed with your engineering team. Eliminating guesswork. Needs-based guided selling meets engineering to dynamically generate 3D CAD models based on customer configuration requirements This empowers sales reps to generate CAD drawings without help from engineering.
A quick stop back into your CRM systems
With the solutioning complete in the CPQ tool your sales team can quickly export the result, including a proposal document, into your CRM software. Using built-in functionality such as Salesforce and Dynamics (or any CRM) with the information from the CPQ can make it easier to report while creating follow-ups options as well as forecasting future opportunities.
The final piece: Order fulfillment
Your sales rep is excited as ever to have just closed a deal faster with CPQ and CRM connected but one more important connection remains, order fulfillment. The customer and your sales rep know what they want, now it’s time to deliver. Creating the optimal solution requires an equal data and pricing structure that uses the segmented data from your CRM to create market-based pricing. This is where your ERP system is fed critical information from Tacton CPQ. The ERP system then will plan the production, ensure the delivery and send an invoice to the customer.
Manage product variance
A great example of managing product variance is with our integration to SAP Variant Configurator (VC). Tacton can leverage the product data and configuration rules from SAP ERP and SAP VC to deliver accurate, up-to-date pricing, bundling, and product configuration information to sales teams, partners and end customers.
IT administrators can spend their working hours transferring data on materials, BOMs, pricing, and more from SAP to CPQ. Resource-inefficient implementations require custom code developed by programmers to convert extracted data into formats that can be imported to the CPQ tool.
As a result, any changes an SAP administrator makes will probably require additional maintenance (at a high cost, of course). But with Tacton the sales configuration data is extracted and translated from SAP VC models on a frequent, scheduled basis, eliminating these problems.
Allowing Tacton CPQ to configure the modules and SAP VC to cater to the modules on a manufacturing level for production. Let SAP VC handle the production and Tacton CPQ to be responsible how modules are selected.
Here’s how it works from your customers point of view. Product inventory, capacity, and available-to-promise from SAP ERP are made available to the quoting screens in your CPQ tool. After this is done, your opportunities and quotes are created in CPQ and pushed to SAP sales order management. Finally, to complete the order to fulfillment process, you process and ship your orders, invoice them and collect payments within SAP. The entire process is completed when inventory is updated and made available to the CPQ tool for the next quoting cycle.
A connected loop
You know the acronyms, CRM, CPQ, and ERP very well and now understand the importance of an eCommerce integration. When working separately can be very useful for helping your manufacturing customer succeed. Once they are combined, they can be the basis of a digital transformation for your company. Connecting everyone in your operation from the first person to contact prospects to the person who sees it roll off the assembly line can create a place for centralized operations. CPQ is the mortar that binds your CRM and ERP systems together.
Connecting all these processes will also enable your business to go fully online with eCommerce as well. Embedding an online configurator with self-service can help manufacturers reach go even further. The customer can start the solutioning journey online even before involving any sales rep. With a needs-based selling approach, the customer can express their needs and get a solution accordingly. Your customer gets involved and can fill their shopping cart with products that fit their needs. Once all these items are combined your business will be the envy of the industry.
Leverage your digitalization investments with CPQ
Sales and Marketing use their investments to engage customers, manage relationships, and ensure they are acquiring relevant data. Engineering investments ensure they have proper product data, technical drawings with CAD, and have the proper information to manage the product life cycle.
The factory makes investments to support supply chain, execution, and efficiently building products. The wealth of data across these investments is absolutely critical to internal efficiency and external customer experience. Placing a smart CPQ system at the center of your digital transformation is the most efficient strategy to build a technical stack that connects your end-to-end processes.
Learn more about the current state of digital manufacturing with survey results
CPQ is the future proof solution you’ve been looking for
COVID-19 has illuminated a lot of issues in manufacturing, one of which is disconnected systems that slow down how manufacturers sell. Your customers aren’t coming back into the showroom anytime soon. Finding ways to still work seamlessly, and accurately with customers can make the difference between winning and losing deals. Right now, is the perfect time to focus on reinventing the buying journey for your customers while improving internal operations from sales to the factory floor.
When configuring manufacturing goods it’s important to go above and beyond just offering the basic product. Accessories are an essential part of the final use of the product, so why do many manufacturers make it so difficult to buy them? The right accessories are the icing on the cake that transforms a suitable solution into the perfect solution. Many suppliers, therefore, have an extensive catalog of optional accessories to meet the most individual customer requirements. This can present its own challenges without CPQ for mountable accessories.
The problem is that suitable accessories are often only offered after the product has been configured – and not during configuration.
The Module Variant Catalogs feature from Tacton CPQ provides a solution. This makes it possible to integrate mountable accessories directly into application-based Guided Selling.
The advantages of CPQ for mountable accessories:
The configuration engine ensures that accessories are 100% compatible with the currently configured product and can be assembled.
Mountable accessories (catalog) can be assigned to precisely defined positions on the configured product.
To make it easier for customers to select optional accessories, matching accessories can be displayed according to selected product properties.
When changes are made to the configuration, selected accessories that no longer fit the current product configuration are visually highlighted.
Selected accessories are automatically added to the parts list and priced.
Module Variant Catalogs in a practice test
A supplier of high-quality endoscopy equipment offers monitors to go with its equipment, but these are not manufactured in-house and therefore correspond to standard market sizes. In the past, the supplier only had a few selected monitors in its range to ensure that the monitor was also compatible with the configured endoscopy device. Over time, customer requests increased: more and more customers wanted to use monitors that were not part of the accessories catalog. In order to fulfill these customer requests, the supplier had to check each individual request and ensure that the monitor requested by the customer could actually be fitted. Effort and distribution costs increased.
The solution is called Module Variant Catalogs with Tacton CPQ: With the feature, the medical technology provider is no longer tied to a few monitor models. The provider can easily integrate complete product catalogs directly into Tacton CPQ. Based on defined product characteristics, models matching the currently configured endoscopy device are filtered and can be selected during the configuration process.
Today, customers can simply select the appropriate monitor from an extensive range. This increases both service quality and customer satisfaction. The provider, in turn, saves valuable resources because customer requests no longer have to be checked at great expense. This is done directly during product configuration by integrating product properties of the individual monitor models, stored in external catalog systems, directly into the configuration logic.
Discover how using CPQ module variant catalogs can help increase win rate, increase customer loyalty, reduce cost and errors, and more in our latest CPQ video! If you’d like to see more on Tacton’s products check out our other videos on our youtube page.
Let’s face it when it comes to working habits, we all have our routines. From checking your inbox to seeing what the day holds to how you interact daily with customers and prospects. Change can come at a glacial pace at times for manufacturers. Adopting solutions like Configure, Price, Quote (CPQ) is a challenge many manufacturers face after they purchase it. How can CPQ buyers get their teams to change habits that have formed over the years of both success and failure?Building trust with a product configurator is easier said than done. Let’s look at some tips on how to get your team to buy-in.
Shift the sales mentality
Think about the typical selling process for highly configurable products for a moment. A prospect connects with a request for your product. This product can have a lot of moving parts, use an elevator for example. How many buttons does it need? What are the accessibility requirements? How many floors?
These and many more questions are needed to be answered before a sale can be complete. Your team has a way of dealing with this by going back and forth with the customer and engineering. This creates a lengthy inefficient process that takes time and can still be incorrect when it rolls off the assembly line. Not to mention your customer could change their mind at a moment’s notice. All these challenges cost time and money, but they still usually get the product to the customer, even if it’s at a discount. Which makes it important to both trust your sales team while giving them a solution that considers their experience and optimizes how they sell.
Building trust between configurator and experience
Building trust with any product isn’t an easy task. CPQ is no exception. With years of experience, your sales team has a defined way in which they sell, taking them out of their comfort zone isn’t something that is an overnight change. Bridging the gap between their excellent sales experience and a configurator is a way to not only trust your team but also show how much faster they can sell. With guided selling, it’s possible to shift the sales mentality by removing constant product reviews, while also accounting for changing customer demands.
Check out how our customer Burkert created a bridge between experience and product (free direct download!).
Preparing for CPQ: Creating compatibility between product and user
The first step to creating a solution that enables success for all parties is to drive a constructive dialogue. At the end of the day all most people want is to control how they work, no surprises or unexpected errors. That’s why creating a seamless selling journey for your team and customer can build a process that gets deals done while engaging with the customer.
Every sales journey is different, from returning customers to new ones. At the start of the process, it’s all about defining the end-product. What purpose will It serve? Does the customer know exactly what they want or just a general idea? CPQ with guided selling can answer one of these questions or all of them depending on the sales rep.
Every selection shows the consequence of the action, added or removed products are shown in a bill of material that before CPQ was done manually and related to the role of the user. Now instead of your sales team relying only on their intuition, it’s possible to validate your customers unique needs. This creates a safety net of sorts, the more answers you have for the product, the more constraints are shown.
Setting the expectations
The more your team understands the product the better. Using CPQ enables your team to understand the product with or without in-depth experience. This helps everyone involved learn about the application of the final product. Analytics can show that one item is selling more than another, or one configuration is clearly more popular than another. Creating these realistic expectations can take the uncertainty out of the selling process.
Confidence takes time, your best sales rep has years of trial and error when selling to prospects. Every mistake was a learning experience that led to optimizing a manual sales process that would still take days to produce a quote. That’s why building trust with a product configurator is critical to long-term success selling to the new B2B buyer. The knowledge of your sales rep isn’t discounted, it’s optimized with CPQ, together they can use instincts built over years of selling while producing firm quotes in minutes instead of weeks.