Sales agreements and contracts are the lifeblood of many B2B organizations, but managing the negotiation process of these agreements can be painful. In this session, Robert Malanga, Sr. Product Manager at PROS, will discuss the Sales Agreements capabilities in PROS Smart CPQ and show how this tool can not only help you set up your business price agreements, but also automate any modifications you want to make to these agreements fast! He’ll provide you with use cases and sample workflows of how you can increase the coordination between sales and pricing teams as you look to make any changes to existing sales agreements.
About the Speaker
Robert Malanga, Senior Product Manager at PROS, leads the product strategy for PROS agreements and deal desk solutions. Robert has a passion for providing solutions that enable customers to achieve high value results and to develop long-term partnerships. Robert brings 26 years of experience innovating and delivering solutions for enterprise companies in the areas on analysis, optimization, pricing, commerce, and operations. Robert holds a B.S. in Petroleum Engineering from the University of Texas at Austin. He lives in Houston Texas with his wife and three children.
Thank you, Loretta, for that introduction. So today, we're going to talk about sales agreements, closing fast on your RFPs, sales agreements and contracts. And specifically, we're going to talk about the agreement mass price change process and how the PROS sales agreement add-on for smart CPQ can help you there....
So just as a recap, sales agreements allows users to create and negotiate new agreements, manage the lifecycle of an existing agreement. So this means amend, renew, extend and terminate, make agreement pricing at other terms and conditions available for the ordering process. So, make it available to ERP or to real-time pricing engine, and also we manage agreement pricing and PROS Control to allow that price management to happen in control during the agreement lifecycle.
So just as a quick outline of what I'm going to cover. So first of all, I'll talk a little bit about the challenges of managing agreement pricing during the lifecycle of that customer's agreement and across many customer's agreements, the value and benefits of the PROS solution that we are providing. I'll go through the agreement workflows on the pricing side. So, how a pricer would go through this workflow, as well as on the sales side on how a sales rep or sales analyst would actually go through this workflow as well. And then I'll give a final solution description and I'll talk about all the features that are available in the product.
So, some of the top challenges that we see at PROS for the pricing and sales organizations around agreement price changes are a difficulty responding to market triggers. So, I have a bunch of agreement pricing that's in place. Currently, customers are ordering off those agreements, but I have opportunities and changes that happen in the market around costs, material costs changes, or just changes in the general market that affect my target pricing. So, those are all things that are difficult to respond to if you don't have a system that allow you to do that.
Also, manual processes. So, many of today's processes around making changes to agreement pricing are very manual. So, such things as even in deviant to determining what price to set and what price to set it to, getting the approvals on the various organizations that need approve such a change in pricing and in sales, updating the agreements. So, once I've decided what I want to do, I've got it approved, physically going and finding the systems to update. That's always the challenge and delivering our grievance to external systems that need it for the ordering process like ERP. So, these manual processes are typically very time consuming, prone to errors because you have many different people doing manual things, and that can result in a loss in margin and also a loss of customers, so via customer churn.
And the final challenge we really see is that the sales and pricing teams that are very involved in this process are not aligned. So, there's no collaboration between the two organizations, pricing teams are not able to leverage the account specific knowledge that the sales organization possesses and the sales team just doesn't have visibility into what pricing is doing, what process they're going through to come up with these new prices, and they don't have any visibility into global things like cost changes on the products and guidance changes in the system. So, those are all things that challenge organizations around making agreement pricing changes.
So, now we'll talk a little bit about kind of the value and benefits and what we're providing in the sales agreement solution. So this month, we launched a new feature, our newest feature for sales agreements, which is called, we're calling mass agreement price change. So with this new feature, we're going beyond the traditional CPG workflow where pricing management and agreement management are totally separate activities in very disparate organizations. We're giving the pricing organization more control over agreement pricing to react changes in the market. And we are also at the same time giving more power to the sales organization in the decision-making process around what pricing is going to change to, as well as what prices are going to be executed.
The primary value cases around this feature are A. speed and efficiency. So, being able to make quick changes to pricing across our various agreements across customers, being able to see a change in the market and immediately react with a price change. Traditionally today, that's not something that's done very easily because you don't have visibility into that change and you don't have ability to go through that price change very quickly. Inefficiency, so making it very efficient on the resources that are involved in the process, making it very easy for pricing organization to make the change and very easy for sales to give their input.
And finally a value through impact and collaboration. Being able to understand the impact of making this price change across your agreements and across your business, and then being able to have pricing and sales collaborate in that overall workflow. So, this allows a bit more collaboration, a bit more teamwork, and able to provide a bit better price that's executed to the customer.
So, now we'll talk a little bit about the workflows that are involved in this process around pricing organization, as well as around the sales organization. So first, we'll talk about pricing. So, pricing workflow is typically, our pricing organization is going to develop and execute the strategy across all of the customer agreements. So, the strategy is just going to be things based on the triggers that they see in the market. So, one could be a strategy around if I see a cost move, what should I do with my agreement pricing? Maybe I want to look at maintaining margin. Likewise, if I see a general change in the market, like my target pricing has increased, then I'll have a strategy around maybe bringing up my agreement pricing to match that target increase. So, this is the ability for them to kind of infuse the overall structure of data that they see into the overall pricing process and come up with good recommendations around where they should take agreement pricing.
This workflow allows the pricing analysts, the pricing persona to go through and review and analyze and approve these changes. And once they've been approved, be able to send it to the sales organization for their part of the collaborative workflow. And so once these recommendations are given to sales, they are able to leverage their specific account knowledge to further refine these agreement specific price changes. Their workflow allows them to designate high touch and low touch customers. For the low touch customers, recommendations can be automatically approved and executed. For the high touch customers, where they want to put more review and analysis in it, sales can do their review and analysis. They can make further recommendations for changes to the pricing based on the outcome of that analysis, get that approval and then send it through the final process to execute. So, that's basically how pricing organizations and sales organizations will execute around mass price change for this feature and for the workflow in general.
Now, let's go into a little bit more detail on some of the features that we're providing in this mass agreement price change feature. So, if you look at the screen here, we're talking mostly about the pricing analysts and then using PROS Control to execute the price change. So, we're using typical functions in PROS Control, but we've done some enhancements around that.
So first of all, we're looking at a process by which we can load a cost data into the system. As an example of this could be also market data, whether it's an index or could be guidance type data where I'm loading in my target pricing. And based on that load of data, we can understand when there are changes in the market. And based on when those changes occur, we can decide to pursue a certain price change strategy.
And so that leads into the second bullet, which is around the ability to go through and actually develop pricing strategies and business rules to help develop the best optimal pricing on these market changes. So when I see a change, what's the best price change to react with? And then finally, a process by which I can take those strategies and execute the price change. So, I go through, generate new prices. The pricing analyst goes through and analyzes those changes, reviews those changes, and finally gets approval from their manager to say, well, yes, this looks good. This meets our target for what we want to do. Now, let's push it to the sales organization in order to get their feedback and approval as well.
So, that brings us to the sales analyst persona that we're working with in this feature. So, now we're more of into the CRM and Smart CPQ world where we're allowing the sales team to go through, review changes that impact their accounts and their agreements. So, they don't see everything. They just see the things that impact their world. This allows them to infuse their specific knowledge of those accounts into the process. And at that point in time, we're giving that collaborative power to the users through these various features.
So first, we'll start off with the ability for them to get notified when a price change recommendation occurs. So, I'm a salesperson doing my regular process. I get a notification, Hey, pricing has pushed through a new change. So, let me go review these changes that are entered into my system. So, now I'm going into CRM. I'm quickly reviewing those changes.
And so here, there's really two types of changes or two types of accounts we're dealing with, with this change. One is the low touch customers. So, these are the customers that I typically don't have to negotiate changes with. All I have to do is understand the changes. I have to notify them. Yes, we're making changes to your pricing, but typically I'm not going through a negotiation process. So in this case, we're pushing out new pricing. We're sending a document to them that says, here's your new price list. If you have any comments or questions, please come talk to me. But at this point in time, this is the new executed pricing for you.
On the flip side, we have for our high touch customers, the ones that are maybe larger impact revenue for my company and ones that predictably provide some sort of negotiation when I'm making a price change. In that case, I'm pushing those changes into an area in CRM where I can review them. I can do impact analysis on them. I can go and see the details on the changes that are being recommended. I can decide, well, I don't quite want those changes based on this account's status. So, let's make a few other changes. Let me communicate this first to my customer before we go ahead and execute, so I can get some feedback. So, all that can be done as part of the overall workflow for high touch customers.
So in the end, they're allowed to decide if they want to accept the changes, make further changes or even reject the changes. And once all those changes have been pushed through, the mass price change has been finalized, it's reconciled back into the pricing organization and the price change is done. At that point in time, further analysis can be done later on as far as realization of the price change and also analysis of how well those changes have performed in the future.
So, the thing to consider here is that with this new mass price change capability, PROS Smart CPQ for sales agreements with PROS Control enables pricing and sales organizations to capture additional value through collaboration and efficiency.
And finally, I'll just leave it at, if you have more questions or you'd like to see more details about this new feature, please go to the PROS website or better yet, please visit the sales product virtual booth at Outperform and ask any questions that you have. And we'll try to answer those questions for you. And also if you desire a demo, please let us know, and we'll take you into a demo and show you the end to end workflow through PROS Control and through Smart CPQ for sales agreements. And we'll be able to show all that together for you. Thank you.