YOUR SECRET WEAPON FOR
A company’s business processes are its life-blood.
As markets age, product features converge and differentiation at the product
level becomes more and more difficult. At some point differentiating among
vendors shifts from product attributes to which company is easier to do busi-
ness with and winning on that difference relies on a company’s execution of
its customer facing business processes. Modern CRM technology can play an
important role in helping companies improve process execution and help
make them easier to do business with than their nearest competitors.
Virtually every company has to deal with multiple business processes such as
the proposal process, contracting, forecasting and myriad others. Very often
in tight markets, the way these customer facing business processes are exe-
cuted can be one company’s critical success factor and a barrier to entry for
a competitor. Moreover, a company’s margins will benefit from clean proc-
esses that can fulfill both a customer’s product and business needs.
While there are many business processes that can be considered for improve-
ment, this Beagle Research Executive White Paper will focus on the customer
facing business processes that are closely associated with CRM and the posi-
tive role that the extended CRM suite can play in helping companies com-
pete. Our analysis will focus on three areas where process improvement can
be easily executed and is relatively inexpensive leveraging modern CRM
• Product configuration, pricing and quotation (CPQ)
• Contract management
• Business forecasting
This Beagle Research Group Executive white paper is based on extensive
research conducted during February 2008
Published March 2008
There are two significant parts of a market’s life cycle — the product innovation phase
and the process innovation phase (Figure 1). There is no time limit on either phase and
each could go on for many years. The product innovation phase is a time when ven-
dors make rapid improvements in their products as a way to differentiate from the
competition. But product innovation eventually slows and vendors either introduce new
products — restarting the product innovation cycle — or they turn to process excel-
lence as a means of out-competing rivals.
A great deal has already been written about using process excellence in back office
operations for enterprise resource planning (ERP) and supply chain management (SCM)
and even supplier relationship management (SRM). Such systems represent big invest-
ments that many large companies take when seeking ways to improve product devel-
opment, production and product delivery processes.
Figure 1 Company differentiation throughout the product life-cycle
Source: Beagle Research Group, LLC, March 2008
In many companies that deliver technology or service products, the back end processes
are rather short. For example, in a software company, there may not be a long sup-
ply chain spread over the world that needs to be synchronized to deliver products on
time and at a specific price point. In his recent book, Dealing with Darwin, Geoffrey
Moore noted that customer-facing processes offer an important opportunity for innova-
tion and competitive differentiation.
When companies turn to process excellence they find ways to remove waste while im-
proving margins — without increasing prices. Often process improvement benefits
both the vendor and the customer. Customers reap benefits from this focus on process
in the form of reducing the friction associated with making purchases — orders are
correct more of the time and there are fewer returns and field upgrades, and contracts
are easier to understand because they do not include useless verbiage, for example.
In many markets including technology and software, telecommunications and financial
services, process innovation is becoming an important area and emerging front office
companies are filling important niches that improve process execution.
Adding process improvement applications to existing business processes need not be
an expensive or technically demanding job. Many of the process improvement appli-
cations on the market today come pre-integrated with core CRM applications such as
Salesforce SFA through the Force.com platform. Pre-integration along with on-demand
availability and low cost are strong arguments for many organizations to consider dif-
ferentiation through process improvement.
THE CONFIGURE-PRICE-QUOTE PROCESS
Early stage companies are more likely to sell a lot of custom products in part because
at their stage of corporate evolution they are taking input from the market place to
define their products and services. However, as products standardize, customers come
to expect a higher level of standardization in process execution as well. For products
that are available “off the shelf” customers expect automatic and competent vendor
interactions i.e. customer-facing business processes.
This standardization tends to constrain margins that companies previously received on
customized products. One approach to maintain margins is to lower overhead by re-
moving as much potential for error and rework as possible from the sales-order-
In a standardized product environment, a mistake in an order can be costly. Vendors
are often faced with the unenviable task of having to explain to customers that to com-
plete an order with missing items they must add cost. And even if the customer accepts
the additional cost, the vendor may have to send an expensive field technician on-site
to install a component, often without being able to pass on the cost of the site visit.
Standardization is also complicated by mergers and acquisitions in which multiple
product lines and sales teams come together to sell a unified product set. The merger
is in some ways an exaggerated example of the situation faced whenever a new
salesperson is brought on-board. In companies that sell products with big bills of mate-
rials and paper or spreadsheet based catalogs, it takes a long time for new sales
people to get up to speed with the “system”. Sales teams that hire frequently or have
to incorporate sales people and product lines acquired in a merger can find this a
Quoting and pricing issues also affect the sales process in more mature companies. For
example, there is increasing pressure on executives coming from boards of directors
and shareholders to standardize discount policies and to monitor and manage that
process. Often early stage companies manage discounts through email between the
sales representative and the sales manager — an ad hoc process that is wide open to
Without a system to manage the discount policies the sales process can be subject to
unnecessary delay and sales representatives may take liberties with discounting.
Worse still is the fact that the whole process can only be audited with great difficulty,
if at all, so many companies have no idea what they may be losing through inappro-
A good CPQ system can meet all of these challenges by automating the input and
management of core product information, by providing workflow and audit trails for
the whole configuration to quotation process and by placing checks and balances on
THE CONTRACTS PROCESS
In the discussion of process standardization, contracts simply represent the opposite
end of a long continuum that starts with the configuration. Ironically, many of the same
people affected in the CPQ process are also affected by contracts — sales people
and their managers. However, the contracting process has the potential to impact oth-
ers in the company as well. For example, the general counsel’s office is a prime target
but so is the CFO, especially when trying to close a financial reporting period.
Surprisingly, many companies that automate the CPQ end of the process still generate
contracts manually or nearly so. As a practical matter, the same technology ap-
proaches that ensure that all relevant components get included in a configuration can
be used to ensure a contract is well defined. Since the contracting process can extend
a sales process at times when both parties wish to conclude an agreement, it makes
good sense to use appropriate automation at this end of the process chain as well.
Vendors of contract management systems recognize that there are a limited number of
permutations to a company’s contracts and even of specific clauses. A contract man-
agement system enables users to set up a contract template in which all of the options
are available — though not necessarily shown to the user.
For example, a vendor’s standard positions on a contract issue may be the default and
a user without legal training could generate a satisfactory standard agreement without
involving the legal staff. In many cases though, a company will have fallback positions
for many issues where customers could conceivably require different terms. Although
the company might prefer its default position, contracts management systems enable
legal experts to configure these alternative positions — with business rules for their use
— to guide the user.
A contract management system may include any or all of these five parts and some
vendors may specialize in one or more, but not all.
1. User interface — For generating specific contracts from a company’s template
agreements. A set of rules guides the user through a process that results in a clean
document suitable for presentation to the customer. Useful features include one
click simple document creation, automatic faxing when a document is completed,
electronic signature capture and storage and retrieval via a specialized library or
2. Contract authorship — This module enables a contracts expert to set up agreement
templates and the rules that will govern the agreement. Various vendors ap-
proach this in different ways, some preferring a customized text editor while others
rely on standard word processors such as Microsoft Word. Either way, integration
with popular email, appointments schedulers and word processing applications is
prized. Useful features include the ability to import third party agreements, a
standard clause library, version control and audit trails.
3. Contract compliance — Supporting storage and retrieval as well as searching
documents for rapid analysis of phrases used. Dashboards, workflow and report-
ing can be useful here as well as in other modules.
4. Signature management — Digital signature enablement and management reduces
the time it takes to conclude agreements and eliminates many non-automated steps
such as printing, faxing, and parcel delivery so that all parties can reduce adminis-
trative loads and concentrate on the business at hand.
5. Analytics — Used to uncover information in the other modules as well as to per-
form what-if analysis.
IMPROVING THE ACCURACY AND PRECISION OF THE BUSINESS FORECAST
At first blush, forecasting may not seem to logically fit into the same process improve-
ment concept as CPQ and contract management but that could be due to our limited
conception of what a forecast is.
Very often the idea of forecasting is limited to the experiences of sales people and
their managers in trying to accurately predict the revenue that will accrue within a
given reporting period. However, revenue forecasting is really only a subset of over-
all business forecasting, which in the case of manufactured goods, especially, can be
very intricate. For example, business forecasting often affects the CFO, divisional gen-
eral managers, product and brand managers as well as the entire supply chain.
The forecasting process is much different for companies that deliver configured or
manufactured products rather than goods that can be mass produced such as software
distribution packs or services. Manufacturers, especially those with global supply
chains, must have the ability to deconstruct quotes into component quantities and their
associated prices, and convey that information correctly to suppliers to ensure avail-
ability of parts and to lock in pricing. Moreover, each component involved in any con-
figuration has such attributes as availability, lead time and price — and many prices
are based on volume agreements. Getting the forecast right is essential to ensuring
product delivery when promised and to fulfilling commitments up and down the supply
Manufacturing companies that work with direct and indirect sales forces as well as ex-
tended supply chains are vulnerable to even small variances from forecasts. It is very
important for these companies to understand quantities, prices and any special prom-
ises or circumstances so a forecast must be more inclusive than a simple dollar amount
and a probability of close.
Traditional forecasting, especially using manual spreadsheets is a distributed affair.
Individuals prepare their forecasts, each of which carries its own potential for error,
and companies roll them up to higher levels, which effectively compound the potential
for error. In addition, spreadsheet based forecasting is complicated and large com-
panies may only be able to roll up their forecasts infrequently — a few times per year
in some cases. For manufacturers, infrequent forecasting leaves many of them exposed
to error and ties up capital in excess inventory.
Using a centralized forecasting facility into which all forecasters directly contribute
their forecasts and their incremental changes — instead of a traditional roll up ap-
proach — can remove much of the error potential and provide managers earlier in-
sight into changes in forecasts and thereby provide more time to analyze and correct
for changes throughout the supply chain.
Centralized forecasting can be delivered as an on-demand utility making forecasting
tools available to all users with access to the Internet. Modern forecasting tools give
companies better access to information resulting in greater visibility into their business
leading to greater accuracy and precision for both the supply chain and the customer.
PRODUCT CONFIGURATION, QUOTES AND
BIGMACHINES — CONFIGURE, PRICE, PROPOSE (CPP) SOLUTION
BigMachines offers a suite of on-demand products that streamline the inquiry-to-order
process. The suite enables companies to reduce the number of process steps and
therefore the potential for error in building configurations, pricing them and generat-
ing accurate quotations. The improved accuracy and precision goes hand in hand with
lower costs because automation eliminates duplication of effort such as redundant data
entry, and ensures that configurations are accurate and include all necessary and rec-
ommended components and services. BigMachines’ customers cluster in industrial, medi-
cal, software, and hi-tech markets where complex products are offered with many dif-
ferent pricing options and proposal outputs.
FIREPOND — A SINGLE APPLICATION FOR CONFIGURATION, PRICING AND QUOTATION
Over a period that covers two decades, Firepond has developed and refined its tech-
nology for supporting the integrated configure-price-quote process. As a fully multi-
tenant SaaS application already integrated with Salesforce.com, Firepond CPQ On-
Demand gives sales professionals a range of functionality that assists them in quickly
generating correctly priced configurations for product lines with a large number of
components. Firepond CPQ OnDemand integrates workflow to eliminate or greatly
reduce the bottle necks associated with approvals — such as discounting — and audit
trails to support Sarbanes-Oxley and similar compliance regimes. Business rules asso-
ciated with on-line price books make it possible for novices to correctly and accurately
configure and price customer solutions.
CONTRACT MANAGEMENT SOLUTIONS
APTTUS — A FULL FEATURED ON-DEMAND CONTRACT MANAGEMENT SOLUTION
Apttus is built on Force.com and sits inside salesforce.com’s data center which is man-
aged by salesforce.com. Apttus provides end to end lifecycle management and makes
it as easy as possible for organizations to streamline their proposal and contract man-
agement process. The company spent great effort to build a contracts tool that uses
Microsoft Word which interacts with Salesforce.com. On top of that platform, Apttus
provides the five essentials for the contracts process including contract authoring, ver-
sioning and approval processes secure archiving, compliance, analytics and signature
management. Apttus integrates with popular office productivity software packages
for email, calendar and word processing. A full range of dashboards, workflow and
reports ensures that users can not only generate and deliver agreements but also man-
age their production, use and archive. Apttus leverages all of salesforce.com’s plat-
form capability including integration, performance, internationalization and SLAs
ECHOSIGN — IMPROVING THE LAST STEP - GETTING THE SIGNATURE
EchoSign is a sophisticated and easy to use tool for securely capturing signatures. Us-
ers register for the EchoSign service and thereafter are able to receive and approve
agreements from any outside source –recipients do not need an EchoSign account to
approve or sign an agreement.
The EchoSign process involves three basic steps:
1. Upload either electronic copy or fax a hard copy (if you require a written signa-
ture), enter the email address for the recipient and send.
2. Recipients receive a PDF copy of the original which they can electronically sign or
print, sign, and re-fax to EchoSign.
3. All participants are emailed fully signed agreements back.
EchoSign for Salesforce delivers seamlessly integrated on demand contract manage-
ment for sell side contracts, allowing Salesforce users to send a contract directly from a
Salesforce account and track the real-time status of all contracts. In addition, users
can create a dashboard to measure the percent of agreements closed, contract close
time, unsigned agreements, and agreements by sender.
RIGHT90 — BEYOND REVENUE FORECASTING
Right90 provides an on-demand business forecasting solution for companies that manu-
facture or configure products with multiple permutations. With Right90, companies
move beyond sales opportunity pipeline snapshots to granular SKU-level forecasts that
detail what needs to be built and delivered, and when. This granularity gives greater
insight into orders that benefits several groups. For sales managers, insight provides
greater accountability and accuracy in the forecast; for suppliers, insight enables them
to line up their own suppliers and schedule more cost efficient production; for company
managers, insight into the forecast enables the company to better manage its cash and
inventory. Right90 enables companies to consolidate and review their forecasts more
frequently thereby enabling them to more frequently identify changes in prices and
quantities. This early warning helps executives better manage to plan and avoid un-
For a long time in CRM, business process has taken a back seat to traditional sales and
marketing for numerous reasons. Fundamental market changes are reshaping how cus-
tomers interact with vendors and customers are increasingly finding that they have
greater leverage. For these reasons, Beagle Research believes that one of the next
growth areas in front office computing will be in enhancing customer facing business
We believe that companies that are early adopters of technologies that streamline their customer facing
business processes will gain a competitive advantage over their later adopting competitors. Therefore,
the early and successful incorporation of process improvement solutions will form a barrier to entry for
later adopters. In markets where customer recruitment is a zero-sum game, making a company easier to
do business with will significantly enhance its market position.
This paper examined technologies that improve processes in three major customer facing areas which we
believe will have significant impact for vendors who adopt their approaches — configuration, pricing
and quotation; contract generation and management; and business forecasting. No doubt other areas
exist. These three areas represent a large end-to-end business process and we believe many companies
will find that they have need for more than one of these solutions.
All of the solutions described here have the further advantage of being pre-integrated with Sales-
force.com’s platform, Force.com. Compliance with this standard will give companies in Salesforce’s large
customer base numerous options when considering how best to improve their businesses.
T H I S I N D E P E N D E N T A N A L Y S I S W A S S P O N S O R E D B Y
S A L E S F O R C E . C O M
Salesforce.com is the market and technology leader in on-demand business services. The company's
Salesforce suite of on-demand applications enables customers to manage and share all of their sales,
support, marketing, and partner information on demand. Salesforce.com's on-demand platform allows
customers and partners to build powerful new applications quickly and easily, customize, and integrate
the Salesforce suite to meet their unique business needs, and distribute and sell on-demand apps at
Customers can also take advantage of Successforce, salesforce.com's world-class training, support, con-
sulting, and best practices offerings. For more information please visit www.salesforce.com, or call 1-800-
NO-SOFTWARE. To learn more about any of the applications named in this paper, click here>>.
A B O U T B E A G L E R E S E A R C H G R O U P
Beagle Research Group is a consulting and market research organization
focused on emerging technologies and companies that will have an important
impact on the way business is conducted in the years ahead. Our work is based
on professional standards of quantitative and qualitative research which
informs all of our publications.
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