Companies who sell configurable products tend to change strategy. It’s a pendulum that beats back and forth every few years between flexible configurations and packaged solutions.
This is quite normal of course, but it often causes problems for the actual configuration.
Now, the main problem is that CPQ (Configure Price Quote) solutions are typically built with an inaccurate focus.
For a product owner — someone who knows how the product works — all possible iterations of the product offering are of course extremely critical.
The conflict: Product Experts vs. Sales Reps
— If something can be changed we should give the CPQ user this possibility, the product expert typically says.
But what about the actual CPQ users – the sales reps?
Obviously, they are not that interested in endless possibilities. They want to paint the big picture and they need a tool that supports them in that.
— I only need a few template quotes to get the conversation started and a ball park figure to indicate the price. That’s why I prefer to use my previous quotations as the starting point for a new quote, says the experienced sales rep.
You can clearly see that there’s a big difference in opinion, right?
The product expert’s view of the product becomes way too complex and the sales rep’s view will quote an outdated product portfolio – something that normally causes serious issues once the quote turns into an order.
The trick – when it comes to a good CPQ solution – is to solve both problems.
To do this, we need a solution that combines the simplicity of templates and the flexibility of a fully configurable product portfolio.
We need what’s called a Bi-Layer Approach.
Introducing: Tacton’s bi-layer approach
The first layer (the sales reps point of view) consists of packaged solutions only specifying the overall requirements. It doesn’t specify what building blocks that will eventually end up on the Bill of Material.
Best practices and market dependencies are described as configuration rules, but again – we leave the actual product out of loop. Okay?
Then, the second layer (the “techie” point-of-view) describes the details and the building blocks for the Bill of Material. The technical limitations of the product portfolio are described in detail.
Questions that every once in a while becomes relevant to specific offerings can be part of a CPQ expert interface, but they are normally hidden to simplify the usage.
Embrace complexity — without drowning in details!
By separating the sales view and the technical view, we can keep the simplicity, but still work with an updated product portfolio.
We also get a clear separation of responsibilities when we don’t mix the market perspective with the technical limitations.
The dependencies between the two layers are something we let the CPQ rules engine figure out – because the constant changes and mind-bending implications between these two layers is too full of twists and turns for any mortal to keep track of!
Are you interested in what a bi-layered CPQ approach could do for your bottom line? Get in contact with the author here.