CPQ technology delivers a lot of benefits to sales organizations but how can you spot if your organization can benefit from this software. In part III of this video series, VP of Portfolio Marketing, Geoff Webb, discusses some of the symptoms you’ll see which indicate your organization needs CPQ.
Loretta Faluade: Welcome to the third episode of The ABC's of CPQ Technology. Today, I have a special guest, Geoff Webb. Welcome, Geoff.
Geoff Webb: Thank you!
Loretta Faluade: Today we're going to be looking at how an organization knows they need CPQ technology. So Geoff, one of the things that I know CPQ technology tends to be used for is with sales organizations, sometimes with e-commerce organizations, but if you were a business leader, what are some of the symptoms that you might see in your organization that would lead you to say, "I need CPQ"?
Geoff Webb: Sure, yeah. Good question. You know, if you think about it, sales people need to sell. Their job is to go sell, engage with customers, deliver value, and obviously drive revenue for the business. The reality is, though, that in most organizations, most sales people most of the time are not selling. They're just overburdened with a whole bunch of other tasks. Putting together quotes, researching the right price, making sure that the product that they're delivering or recommending to a customer is the right product configured in the right way.
So, you know, when you think about the way your business is operating, many times what we hear the leaders say is, "Well if my sales people can't spend enough time "with customers actually driving the business forward." And the typical symptoms that you see, to get very specific, are you know, your sales force is slow in responding. It takes a long time to pull together the information they need and get it to the customer so that they can answer the customer's question. And that slowness typically translates to loss of business, because we know customers in every industry don't want to wait for a response. It translates to a loss of revenue, and it also translates ultimately to a much worse customer experience. That's a problem. Because at that point you start to lose customers to other people that can be more responsive. So slowness in the sales process will absolutely kill your business.
The other areas that we see challenges emerging, that would again, typically indicate there's a problem that can be addressed with a technology like CPQ, for example, is errors that creep into the quoting process. So in other words, the sales person in an attempt to go faster, will introduce errors such as recommending the wrong product, or incorrectly configuring it. Sometimes products can be very complex. You know, you think about a business that's building highly complex medical technology, like an MRI machine, that needs to solve very specific problems for a particular hospital system, you have to get that configuration right or else the customers are gonna come back and say, "This isn't the right product for me. "This doesn't solve the needs that I have." So, errors creeping into the configuration, the recommendation, errors creeping into the pricing that's recommended, all those things, again, what they do is they slow down the process because then you have to go back and do it again and fix it. They erode the trust that the customer has in your sales force, and ultimately in your business, and then at the end of the day you lose business again. When everything slows down, the customer goes elsewhere.
I think the third area that I would see, these are the three big ones, is that there is a tendency for sales people to be less well informed than the purchasing people and the buyers that they're working with. And as a result, what happens is the sales person doesn't have the information necessary to make sure that the price they're quoting is the right price. Not just generically for that product set, but specifically for that interaction, with that customer, for that product, and that point in time. And if you don't enable them to have that information, what you get is sales people working from gut instinct, or from the limited set of information they have, and you'll see margins erode. So if you're starting to see, we're kind of getting the business, but we're not making as much money on the sales as we should, the margins are eroding, the buyers are working to commoditize the offering I'm taking to market. All of those indicate that you're not able to feed the sales teams the information they need at that point in time for that interaction. So again, the thing about the job of a CPQ solution, is it's to automate a lot of the process that slows the sales person down, to reduce the risk of there being an error that's introduced, and to inform and support the sales person in that negotiation so that you not only help the customer, right, you drive really great customer experience, but you also protect the margin and ensure that you get the maximum revenue from the business that you're chasing right now.
Loretta Faluade: Thanks, Geoff. That was really great. So, to summarize, you mentioned that an organization that would need CPQ tend to see three different things. First of all, their sales team tends to be a lot slower in responding to customers. The second one is that errors might start to creep up, whether it's in the configuration process or even in the quoting process. And the third one is having the pricing to be able to negotiate and provide a customer a fair price for that specific product, for that specific time.
Geoff Webb: Yeah, absolutely. And at the end of the day, you think about all those things together, and what it delivers is a better customer experience for your customer. And that's ultimately what people are shooting for.
Loretta Faluade: Thanks so much for being our guest in this episode, Geoff. Join us next time as we start to look at the growing need of CPQ in e-commerce.