CPQ for Industrial Manufacturing
Oracle CPQ Cloud is one of the leaders in CPQ space and has strong presence in Manufacturing Industry. The product offers solution for Configurator and Pricing needs has been enhanced over a period of time to plug in features like BOM Import, Subscription Ordering and Mobile application. It fits in very well with Oracle EBS Order Management, or any other Order Management suite like SAP for that matter.
To understand CPQ Cloud fitment, let's start with drawing a simple sales process flow diagram. Let's consider different actors (Internal Sales, Partner Sales, End User) and possible flows for the Quote Management process.
Internal Sales: The Sales Rep works on integrated CRM and Quote application to look at his opportunities and creates a quote for possible conversions. While she does the complex configurations using CPQ Cloud configurator, she is notified of any constraints while making selections, recommendations for additional parts and the list of parts that keep growing based on selections made. The system maintains the BOM mapping references for parts at the backend which helps in sending details to Ordering system later. The next big step after configurations are completed is negotiating on the price with customer and applying discounts accordingly. Approvals may get initiated based on discount and margin rules setup. Once pricing is finalized and approved, Sales Rep generates proposal document and sends for document signing. There may be a few more steps for ATP check, Credit Check etc. before Contract generation depending on organization's sales process. CPQ Cloud offers Docusign integration for capturing digital signatures and reducing the time taken to complete Contract Signing process after Quote is finalized. Order is submitted to the ERP system as last step in the CPQ system. The Ordering system updates status back to CPQ on Order fulfilment. Also, Service Contract will get created in the Service Management system of the Organization.
Partner Sales: While the partner sales flow may look very similar to Internal sales, it varies as the validations and steps in the sales flow may be different. Also the approval criteria may differ as it would be driven by Partner's criteria for their margins. Channel users (Partner Sales) get restricted access as compared to Sales users (Internal Sales) in CPQ Cloud. Also, after Order placement, the Service Contract may be with the Partner and maintained in their system.
End User - eCommerce: CPQ Cloud offers eCommerce registration process that enables end user to access the Configurator as anonymous user. The user can configure product as per need and then can register to login to create Quote, accept Contract and place Order.
Let's look at possible integration touchpoints with Oracle CPQ Cloud in case of Manufacturing Industry implementation.
CRM Integration - CPQ Cloud offers out of the box integration with SFDC and Oracle Sales Cloud (CRM applications on Cloud), for customer synch and Lead to Quote flow. The sales journey may start from a Lead/Opportunity or a Quote depending on business process of the Organization implementing CPQ Cloud.
ERP Integration - CPQ Cloud offers integration with Oracle EBS for Quote to Order Flow. BOM mapping references will enable mapping the Product hierarchy within the two applications.
Inventory Integration - For ATP check, availability of parts at the time of quote.
Credit Check - For customer credibility for larger value quotes.
Product/Part Master - To synch product and part information. In many cases it may be the ERP system for Order Management that master Product information.
Post Order fulfilment and Service Contract generation, while the service details may be captured in Service Management system, it would need integration with CPQ for Contract renewals and modifications. CPQ Cloud has recently enabled feature called "Subscription ordering" to offer solution to such needs. It enables having a repository of Assets/Installed Base to be fetched from system maintaining it to CPQ Cloud (readonly view) to allow actions for Modification in CPQ Cloud with Asset reference.
With enhancements over last few releases, Oracle CPQ Cloud has emerged as a solution on cloud to resolve pain points with Oracle Configurator (On-premise), and as a leader amongst other CPQ tools available on Cloud. Its strong configurator enables complex configurations involving hundreds of attributes and validation rules behind it. Thus it is a right fitment in manufacturing sector where it involves products/models with multiple configurable attributes and part additions based on selections made. The complexity for Manufacturing Industry CPQ implementation is more likely to be around Product structure and Configuration, the quote management process may align more to out of the box flow with a few additional steps to integrate with other systems or as per sales process flow for the organization.