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As a company, investing in a CPQ system has many benefits and provides a major competitive advantage in the market. There are a few things that are important to know and understand before starting a CPQ project. Being aware of the most common pitfalls will put you in a much better position to ensure a smooth transition and the success of the project. Here are some valuable tips to help you along the way.

Why do CPQ projects fail?

The most common mistake is to develop a CPQ system for the company and not for those who will actually use the system – the company’s customers. The idea is not for the product expert to sit and interact with the system because the product expert already knows everything. The CPQ system needs to be developed for customers in a way that makes them feel comfortable and want to use it. So the key to a successful CPQ project is to move the knowledge from the product expert to the customers.

Other key factors for the success of a CPQ project are having order and structure in all your data. It can be difficult for fast-growing companies to maintain an organized structure across all product data, part numbers and pricing structures. Sometimes you have to make quick decisions and launch new products or new campaigns and you might take shortcuts to get it out there quickly. However, when everything is standardized in a system, the company’s data needs to be structured so that it is manageable. This work can be quite demanding, but if you as a company want to be able to scale up and grow even more, it’s important that at some point during the development process you get to grips with data structuring and get it in order. Otherwise there is a risk that it becomes unmanageable and perhaps only one person in the company knows what the structure looks like.

For a successful CPQ project, it is also extremely important to involve a good combination of experience and skills.

Lack of management support

It is not uncommon to start a CPQ project within a department of a company. However, this can cause problems if not everyone is on board. You need to keep track of all the data, and if you are making a 3D configurator, you also need to keep track of all the CAD files (the drawings of the models) and make sure you have the latest material. This requires almost all staff from all departments to volunteer their time. If this is not anchored in the management and if not all the people in the management believe in it, it will be difficult to make use of the employees’ time and get the results required for the project to be successful.

This is a fairly common problem, but it’s one that we’re very used to dealing with at Animech and that we’re very good at managing. We can’t magic up customers’ data, but we can help our customers because we have the full range of specialists required for a successful CPQ project. We act as a catalyst for our customers, ensuring that the right materials are sourced and the right decisions are made.

The configurator does not focus on users

One problem may be that the configurator is built for the product specialist and not for the real users – the customers. This risks making the configurator too complex for customers to work with. It is important that the configurator is user-friendly and easy to work with so that customers want to interact with it.

Lack of integration with crane systems

It is very common to think big at the beginning of the project and have the ambition to build something that helps the entire business, both the sales department, the finance department and the production department. However, once the system has been completed, there is a risk that both the energy and the budget will run out and there will be no time to take it to the phase where automation and real savings are possible – when you start linking the systems. Having CPQ as a single satellite only helps some customers and not the company because the processes are not in place. However, there does not have to be a huge integration process. Animech’s own configurator, Aniconfigurator, spits out a JSON file (a file that stores text in the form of simple data structures) with configuration data, and so far we have never encountered a system that cannot receive a JSON file. In the case of an ERP or CRM system, just make sure that the data structure of the JSON file is written in such a way that the ERP or CRM system can receive it. In other words, make sure that the right fields are filled with the right data from the configurator.

Lack of communication

Starting a CPQ project affects all departments in the company, so it is important that everyone is involved in both the planning and development of the project. Communication is key to getting the whole business on board. It is also important to ensure that everyone understands the vision before launching such a project. Clear and good communication helps because you need access to all the expertise in all the different departments of the company. There may also be fears. Perhaps an employee is worried that his or her service will be replaced by a computer system and is therefore holding on to data. However, it is usually not about replacing an employee, but rather about freeing employees from the most boring and time-consuming tasks so that they can focus on something more important.

The project is not properly defined

Something else that is quite common is going into a project with good will and commitment without properly defining the goal and purpose. You may also not be entirely sure what the end product will do or for whom it is designed. Is it for sellers? Is it for customers? Is it for the product specialists? Is it for marketing purposes? Is it a pure sales tool? It is therefore important to define the end goal, otherwise it is easy to do a little bit of everything and the project may not reach the end. This is also something that Animech helps with in the start-up phase of all projects. The key is to be very clear and define what the end goal is.

Complex data structure

It is important to keep your data in order. You should be able to look at a part number and say what kind of product it is, color, size, price, etc. It should be possible to extract as much information as possible from a part number.

Final words

In conclusion, the introduction of a CPQ (Configure, Price, Quote) system is a critical but beneficial venture for companies seeking to improve their competitiveness and streamline their sales process. The key to success lies in carefully planning and implementing the project with the customer’s needs at the center, ensuring orderly data management, and involving the right mix of skills and experience from the start. The importance of management support, user-centered design, well-integrated systems and clear communication across the organization cannot be overemphasized. By avoiding common pitfalls and taking a thoughtful approach, companies can create CPQ systems that not only improve the shopping experience for customers but also contribute to internal efficiency and growth. With the right preparation and focus on these critical factors, companies can successfully navigate the CPQ landscape and ensure that their investments lead to long-term success and customer satisfaction.