As I finished this Blog Post I realized that this was too much information for one Blog Post and and hence I broke it up into two separate Blog Posts. I expect that this will help to read and digest the information better.

Please note that while I consider the information below very important I strongly encourage you to review and adopt it with a consulting company you trust to help you select the right CPQ tool for your company. Don’t try to do this alone because there are so many Configure/Price/Quote (CPQ) tools with different capabilities that you will definitively appreciate having an expert on your side who knows the CPQ space in and out.

Note that this should not be

1. Someone from a Configure/Price/Quote (CPQ) Vendor or

  • Most of the Pre-Sales Managers/Sales Managers/Engineers etc. from the CPQ Vendors are very good and only want to help you. Nevertheless they will always be tempted to solve your problems with their CPQ tool, which might not necessarily be the best solution for your company.

2. A Management Consulting company that is not specialized in CPQ

  • They may have many good and capable Consultants (maybe even some certified in CPQ tools), who can learn quickly but you want someone who already knows the CPQ area intimately and is not learning the business best practices on your project.

Remember Configure/Price/Quote (CPQ) initiatives typically impact a large number of teams and errors can quickly become expensive.  Hence my suggestion: Look for a Consulting Company (with specialized CPQ knowledge) with the following characteristics

  • has strong industry experience with CPQ processes and common CPQ challenges. Not only in Consulting roles but also in Sales Operations, Sales, IT, Product Management and Sales Enablement. Ideally across multiple Industries
  • has experience with a large number of CPQ Vendors. This helps to compare different tool capabilities and how they can impact the success of your company’s CPQ initiative
  • has at least some technical CPQ tool experience (e.g. how to write configuration rules)  in order to understand the general tool setup and maintenance requirements
  • has no CPQ Consulting Practice for a specific CPQ vendor because then they will be tempted to promote the CPQ tool for which they have a Consulting Practice. I realize this is not always the case so at least be aware what CPQ practice(s) your consulting partner has.

After this general introduction let’s start with the specific steps you should consider.

1. Get a Project Charter to formally authorize the project by a Project Sponsor (–> Basic Project Management Step)

2. Gather business requirements, and address the following questions

  • Who will use the CPQ tool? (e.g. internal Sales Team, Channel Partners, End Customers)
  • When do you need a working CPQ tool? (e.g. Time of planned go-live)
  • Where do you expect to use your CPQ tool? (e.g. online, only on company issued computers, mobile)
  • What capabilities do you need? (e.g. guided selling, display pricing information during configuration). This is the area where you will spend most of the time.
  • Why do you need a (new) CPQ tool now?

Bottom Line: The customer team(s) should gather and document the business requirements.

3. Prioritize business requirements 

  • Review your business requirements with your CPQ consultant. They may suggest different priorities based on prior experience.
  • Propose and sign off on the prioritized business requirements with all internal stakeholders

Bottom Line: All business requirements are prioritized, reviewed with a CPQ specialist and a formal Business Requirements Document (BRD) has been created.

4. Determine company imposed limitations

  • Determine if your company guides you to use specific systems (e.g. CRM, ERP, CLM)
  • Determine the objectives of your Executive Management Team (e.g. do they have a preference for a specific vendor, capability etc.?)
  • Determine available budget for your CPQ tool
  • Determine impact to existing team(s) (if applicable) and desired outcome for go forward CPQ solution
  • Determine technical requirements and restrictions
  • Determine expected Data Flow and Data usage from CRM to ERP system

Bottom Line: You want to know as many limitations as possible before you start working with any CPQ Vendor.

As mentioned above I will publish the second part of this Blog Post next week. It will include steps 5-10.