The New World of CPQ in Salesforce

September 7, 2016 John Gorup

It must be nice to manage pricing for the Dollar Store. Everything is a dollar. But for many companies, pricing is a complex process. Getting the right price, for the right configuration of a product, and to the right customer is central to the sales process. Until recently, Salesforce didn’t offer a solution that could handle much complexity, so a host of configure-price-quote (CPQ) solutions filled the gap. The CPQ solutions in the Salesforce ecosystem aren’t going away, but for Salesforce customers that want to stay with one vendor for CRM and CPQ, Salesforce CPQ (formerly known as SteelBrick) is an attractive option. To learn more about Salesforce CPQ and CPQ in general, I interviewed Appirio’s Kiran Chowhan.

KCKiran Chowhan has over 18 years of experience in the technology space, and 6 years selling and implementing product CPQ solutions for companies that manually quote custom products/packages/services.


How does Salesforce CPQ distinguish itself from other CPQ tools in the Salesforce world?

First and foremost, Salesforce CPQ is an integrated solution. The quote-to-cash cycle is all done in Salesforce, which eliminates any errors that happen because of integration. Basically, quotes flow to orders, orders to invoicing, invoices to billing, and billing to payment. The orders and payments allow for accurate revenue recognition. Automated scheduling allows for order and invoice generation on a won opportunity.

The configuration for products, pricing, and quote formation support complex selling needs such as volume discounts and customer-specific pricing. This includes subscription pricing for service, labor, or license products, and prorated billing and invoicing. It also has an integrated solution for contracts. Integrated contracts allow for automated contract renewals, generation of renewal opportunities, and quotes based on contracted pricing.

I remember that as a business user doing quotes, many times it was just easier to get a template from another user and format it the way I needed. But quite a lot of times we forgot to quote add-on services, like training. Or we could miss things in a quote that were required for ordering, like a target date. This made a difference based on availability of inventory or resources and month-end promotions. Many organizations are struggling with ad hoc processes. Salesforce CPQ is a great step toward bringing structure and professionalism to the process, which makes a big difference to customers.


What are some of the mistakes you see organizations making when implementing a new CPQ solution?

Many organizations struggle with manual processes. Challenges like incorrect quoting, slow approvals, and incorrect or inadequate provisioning cause a lot of problems. When facing this challenge, organizations often focus on complex configuration. They build an in-house product calculator tool rather than first focusing on quote-to-cash process improvements, streamlining their business processes, and bringing product quote, approval, and order online.

When organizations choose to move to a CPQ tool, they often focus on recreating their homegrown application. This is a mistake because they don’t take advantage of standardized features. They also lose out on the cost reductions that come from no longer having to maintain custom code.

Homegrown applications usually pack a good deal of dense information into one page to make things fast for one user group (often sales or sales administrators). This may allow sales to create a contact or opportunity and add products and quote lines in one place, but such entry forms tend to be limited to what the back-end system allows, instead of taking advantage of CPQ flexibility to front an otherwise static back-end. They may also limit the business use case to one type, as supporting multiple use case paths overloads their design. For instance, they may not be able to create multiple comparative quotes. They also aren’t truly flexible in meeting the needs of other audiences: approvers, managers, deal desk, and other administrators.

Such homegrown CPQ tools are usually not available on mobile devices. Organizations often fail to take advantage of simpler mobile interaction with field sales, partners, and customers. Organizations do this because homegrown applications typically meet the needs of the most experienced users. Moving to a tool like Salesforce CPQ allows companies to rethink and simplify their CPQ processes.

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