How To Maximize Profit On Each Project, Design and Jobsite

Justin Bailey

Let’s imagine you’re in the shoes of your newest salesperson who is visiting a long time customer as they spin up a new project. Maybe it’s a new piece of machinery with electrical or hydraulic needs that aren’t exactly off-the-shelf. Or perhaps this is a new apartment complex going up in Denver, and you’re trying to spec air and water barriers into the design while respecting local building codes.

Regardless of what you’re selling, there’s a host of know-how needed to bring to bear in this situation to be successful. What products do you offer? How many squares of material or valve styles do you provide to meet your customer’s needs? What are the pro/cons of the different offerings? What price point for this particular job will win you the business? Are you talking about some commoditized use case, or something special only your firm can deliver? And oh, the customer wants the proposal back by tomorrow.

To make matters worse, your salesperson isn’t a 20 year industry expert, but instead someone hired for their people and deal closing skills. Sound familiar?

Possible Pitfalls

This is where processes tend to break down. Companies miss beats with customers and relationships begin to fray. Not for lack of good intentions, but simply because we fall down on our ability to execute repeatedly and sustainably, let alone stay focused on the right price for the value we bring to that specific deal.

Businesses that are tied to individual projects and price authorizations are particularly vulnerable to these sorts of scenarios, as there are multiple possible failure points and relatively little data quality or oversight possible at the opportunity level. Product Management is left wondering whether their value offering is being presented properly. Finance is wondering where their margin projections have gone and sales is simply trying to get a proposal and deal done with a minimum amount of friction.

In my line of work, I see these scenarios play out time and time again for different industries. Too often I hear, “but we’re different” or “you can’t imagine how complex our sale is”. While I occasionally run across some surprises, more often than not if we continue to drill down into root cause of frustrations, it’s the same drivers. ERPs and CRMs are excellent at executing orders and managing pipeline, but they’re simply not designed to pull together everything needed for a jobsite or engineering design proposal and provide a winning price and intelligent approval process. Somewhere there is a gap, and both sales and margin begin to atrophy as the organization loses the ability to see through the day-to-day chaff and focus on what is important.

Reduce your Risk

How can you provide a high performing, end to end process that drives commercial excellence and reduces risk in the sales process? Intelligent Configure Price Quote (iCPQ) is one way to directly address the need for jobsite and design specific sales by automating complexity and providing the behind-the-scenes pricing intelligence that makes every salesperson as good as your best salesperson.

Start by assessing your current state and then envision where you could go. Here are five steps to help move you in the right direction.

1. Identify process bottlenecks. Count how many people are required to author, approve, and load into ERP/CRM a new proposal and assess total time to quote. This is a simple exercise that is often enlightening on process complexity. If you want to advance the analysis beyond a simple count, draw arrows connecting process steps to individuals on a white board to map out the process flow. Where are the bottlenecks?
2. Assess needed skills. Once you have visibility into all the people who may be involved in the opportunity to order, write down the skills each person needs such as customer facing skills, technical/engineering skills, or knowledge of how to make back-end systems process future orders.
3. Assess the risks, repeatability, and trainability of each skill and step. This is key. What most organizations will find is that somewhere in their process are “heros”…. 20 year veterans who really know customers and the industry, or the ERP system and how the plants build product, or a go-to engineer who can distill customer requirements down to technical requirements. Now think about what would happen if those individuals were gone. How would a process continue? Would the same quality sustain itself with their replacements? How easy is it to hire for this position?
4. Envision a repeatable, accurate, and rapid future state that lowers organization risk. No current state must remain as-is. In fact, competition demands you continually improve. Based on the analysis you’ve done so far, you will likely have found process bottlenecks, hard-to-replace personnel, and overall, a process that is just too slow. Now throw that process away, and envision how it SHOULD look. What skills and processes should be automated to create the desired customer experience and make you more competitive?
5. Plot your path forward. Today, most company leaders are well aware they need to be better and faster to compete. This is a topic area that is almost universally welcome, but is often held back by internal perceptions: our product is too complicated to automate; we don’t have budget; our proposals must look different in different regions and more. These are real challenges, and they shouldn’t be downplayed. However, leading companies have solved these problems and entire industries exist to support your journey. Roadmap your priorities, set realistic timelines (a third party can sometimes be helpful in assessing this), and be optimistic for the possibilities. Your customers and your bottom line will thank you.

Justin Bailey is a business consultant with Vendavo.