From its back office beginnings to major acquisitions, configure price quote software has been necessary to sales organizations for the last 30 years.
Think for a minute about all the separate pieces that going into the device you’re reading this blog post on. There’s the motherboard, screen glass, tiles for the keys – just for one device. Now think about the complex configurations that sellers have to scale to build enough devices to full store shelves.
Now, think about really complex products like robotics, medical and aeronautics equipment.
All of these highly complex products are also considered “highly configurable” and for years, configuration software has helped sellers manage intricate interactions.
Ashley Verrill composed a great timeline of the history of CRM (customer relationship management) software for the website SoftwareAdvice. One of my favorite timeline tidbits that she includes is in 2008, the shift “in focus from transaction to interaction.” What a perfect way to describe the CPQ marketplace.
CPQ (Configure Price Quote) is the natural evolution of traditional configuration software. Let’s jump in the Deloren and look at a timeline of Configure Price Quote.
Flock of Seagulls ruled the airwaves and automating the order-entry process was a big challenge. That’s a lot of problems. A rules engine called a “configurator” was created to ensure sales were aligned with ERP (enterprise resource planning).
Configurators are solving the “dirty order” problems as they are more tightly aligned with CRMs. (Also, music starts to get better… sort of.) As sales force automation (SFA) migrates to CRM, configurations are still seen as “back office”, like ERPs.
As SFA were growing steam, independent SFA companies went public. Siebel Systems buys a configurator and the terms “product configurator” and “sales configurator” are born as the configuration software game moves to the “front office”. These new sales configurators are gobbled up by SFAs. (Also, sports were awesome.)
Sales configurators advance into the interactive selling system (ISS) world. Leaders like Selectica are at the core of ecommerce, b2b portals and sales automation, blurring the lines of all three. Selectica and Trilogy had the pieces to make ISS work, but many others did not and the market went away.
Sales configurators rebound from the ecommerce bust and dust begins to settle. Independent business owners begin to rebuild the marketplace, as sales organizations still need to solve the quote-to-cash problem.
After lost years in the mid–2000s, industry analysts at Gartner report on the benefits a newly termed product Configure Price Quote (CPQ) describing it as “software applications supporting the configuration, pricing and quote generation activities that accompany solution and negotiated selling”.
CPQ providers again are once again seen as assets to enterprises, and the story starts to come full circle. In the fall of 2013, Oracle brought CPQ provider Big Machines, leading Forbes contributor Louis Columbus to write, “of the many strategies enterprises can pursue to increase selling effectiveness, CPQ has continually delivered reliable, measurable results … CPQ is one of the hottest areas of CRM growth.”
The three-decade longevity and continued resilience of sales configuration software illustrates the difficulties sales and service organizations have with integrating with other product software and composing quotes accurately and quickly.