Industrial Manufacturer Implements CPQ Cloud to Handle 50% Increase in Quote Volume.

Among the challenges to be addressed were their outdated pricing and configuration functions. The existing SAP system was not user-friendly. In fact, depending on the product being configured, around thirteen disconnected and unsupported applications had to be used for the configuration and quote generation process.  

The quoting process was complicated and inconsistent, with no existing platform for partners or external salespeople to gain access and create quotes. As a result, the sales engineers had to take calls from partners and build the quotes for them. The complicated quoting process had no controls to ensure discounts were being applied within the advised range. 

The lack of visibility and management of these quotes and margins meant an estimated $1M in annual profits was lost. The existing tools they were using were costing them money, and they were losing deals due to slow response times. Additionally, blower configuration at that time was more of an art, not a science. What made configuration even more challenging was that there were at least 26 separate models of blowers with different levels of complexity which gave a bewildering set of options. 

• After defining the challenges, the company’s executive management accepted Accelalpha’s replacement plan for the SAP variant configurator. It was necessary to use a dynamic configuration of Engineer to Order (ETO) routing for work centers to integrate with SAP manufacturing. Then Oracle CPQ Cloud and Intelliquip’s numerous selection and sizing tools were implemented to replace the SAP Variant Configurator. 
• By integrating with the existing SAP ERP system, Accelalpha created a single data source for pricing, customer information, and parts. The new Bill of Materials (BOM) Mapping configuration helped structure BOMs to identify invalid or missing SKUs. Additionally, new pricing rules were set to protect margins and lock in guidelines for proper order discounting. 
• External sales users would now be able to use a “Special” parts process to allow users to configure parts and create their own quotes. The CPQ implementation was explicitly designed to meet the organization’s requirements and helped create a framework that other worldwide divisions could use.

The implementation successfully created a single tool replacing the thirteen disconnected tools previously used to configure, size, price, and quote all blower products. Improved processes will reduce delays and simplify the Engineer to Order (ETO) process to meet delivery deadlines. They also gained better visibility into the quoting process with accurate and consistent pricing, costs, and margin data, which now automatically generates proposal documents for each order. Partners could now effectively select the size and quantity of blowers and create their own customer quotes. With these improvements, the company anticipates at least a 50% increase in quote volume, enabling it to scale its operations and protect its margins while growing both the top and bottom lines.