Three Signs Your CPQ Solution is Ready for Replacement

Nothing lasts forever, they say. The great mountains were lowly valleys until tectonic forces propelled them upward, and as soon as they reached their apex the winds and rains began the relentless process of wearing them back down again. 3-signs your cpq solution is ready for replacementIf the mountains are vulnerable to change, what chance does your CPQ solutions stand? It’s subjected to relentless change too, coming from far more dynamic forces than weather. Evolving product mixes, shifting pricing strategies and the frequent creation of new bundles can erode the effectiveness of your CPQ solution, especially if it’s a home-grown solution. Such upheavals may force you to change the CPQ technology you’re using. But when is the time for change right – and, more to the point, when does doing nothing become too expensive to bear? We’ve talked at some length about the need for companies without CPQ to adopt the technology (and even outlined the economic argument). But there are times when a switch from one CPQ solution to another is needed. Here are three alarming situations that indicate that time has come.

Configuration Isn’t Coping with Your Complexity

CPQ only works when the data and rules within it are up-to-date. Otherwise, it’s just a point-and-click version of the old, out-of-date product and pricing books it replaced. If it’s going to reflect the current reality of your product mix, it needs to be up to date. Similarly, if it’s going to reflect changes to the approval process or to acceptable discount thresholds, or contain the most current bundled offers, those must be included in the system. CPQ is supposed to handle change gracefully and easily. However, some solutions (especially home-grown CPQ systems) didn’t focus enough on ease of configuration during the design process. The upshot: as the complexity of product mix increases, as managers seek to become more agile in adjusting deal rules, and as product managers become more adept at identifying up-selling and cross-selling opportunities and new bundles, the amount of change the CPQ solution needs to assimilate starts to exceed the ability of the people managing the system to add those changes given its configuration limitations. That’s a signal to look for a more enterprise-ready CPQ solution, with an emphasis on ease of configurability. The whole point of CPQ is to save time, so if you replace time-consuming quote generation with time-consuming configuration management, you’re doing it wrong.

You Can’t Analyze Deal Data

You can’t manage what you can’t measure, to paraphrase Peter Drucker. And, if you’re using a CPQ solution from which you can’t extract data for analysis, you can’t manage as effectively as you ought to, even though you are generating and recording data. Without the ability to export data automatically, analysis turns into a laborious manual affair, with lots of data re-entry and the ever-present possibility of data entry mistakes (you remember those – they were part of the reason you implemented CRM in the first place). When your need to analyze data from quotes and proposals starts to swamp your team, you need to make the jump to a CPQ solution that is better integrated into other systems, or at the very least which has its own analytics capabilities baked right in. CPQ doesn’t just generate quotes – it generates data, and plenty of it. Choose to ignore the insights in that data at your own peril.

Channel Partners are Being Left Out

CPQ isn’t just a boon for the direct sales force – it can have an even greater impact helping to guide channel partners, who have even less time to devote to memorizing a company’s product mix, cross-sells and up-sells, bundles and other elements of a vendor’s product line. CPQ can help partners look like experts on a vendor’s offerings and avoid missed revenue opportunities. That maximizes revenue for the partners while at the same time making the vendor easier to work with – a sure-fire way to ensure that partners see vendors as easy to work with and thus steer their own customers toward the vendor’s solutions. But a lot of entry-level CPQ solutions have a tough time being open to channel partners and incorporating rules directed specifically toward the indirect channel. Home-grown CPQ solutions often fare even more poorly with partners, having usually been created to help the direct sales force with no consideration for another set of users outside the vendor. Opening up a home-grown system to partners can be expensive and time consuming – and can hold back channel opportunities. If you’re expanding your channel partner program, or just starting one, it’s a good time to also upgrade your CPQ solution with an eye on its effectiveness for salespeople who are not a part of your direct sales force. Having a solution that’s integrated with sales enablement is also critical so that your partners have a portal through which to access CPQ and so that you can deliver pertinent content to partners when it’s most needed in the sales process.

By Chris Bucholtz | June 6th, 2016 | CPQ

About the Author: Chris Bucholtz

Chris Bucholtz

Chris Bucholtz is the content marketing director at CallidusCloud and writes on a host of topics, including sales, marketing and customer experience. The former editor of InsideCRM, his weekly column has run in CRM Buyer since 2009. When he's not pondering ways to acquire and keep customers, Chris is also an avid builder of scale model airplanes.