An overview of Quote to Cash - first part of a multi part series (starting with Configure/Price/Quote)

I've worked for many years in the Quote to Cash area and this is my short overview of the processes and systems that belong to Quote to Cash. I hope this is helpful since many people who don't work in this area are not really sure what Quote to Cash means.

Before the processes and tools below can be used we need to decide through what Route-to-Market (e.g. High Value Products, High Volume Products) we want to sell our products and services and if we want to differentiate these by Business Unit (e.g. Hardware, Software, Services).

Here are all the processes and systems that belong to Quote to Cash. We start with Configure/Price/Quote processes and tools

1. Product Configuration tools (e.g. used on HPshopping.com, Dell.com)
    - some tools that are offered in this area are SAP Variant Configuration, SAP SSC, BigMachines,
      Apttus, NetformX
    Note: Every tool was developed with a limited number of use cases in mind. Therefore it needs to
    be determined in a thorough investigation which tool is needed for what purpose while we also
    want to avoid double maintenance of tools. For example, we don't want to use a BigMachines
    configurator on our website and a SAP SSC tool for our sales reps. We target to have all the rules
    for these configuration tools in one place.

2. Pricing tools (e.g. List Price in USD, EUR, Purchase Agreement Prices, customer specific
    discounts)
    - some tools are SAP eCC, SAP CRM, a custom developed tool with a DB or a myriad of other
      tools
    Example: There can be one Database for List Prices (in different currencies), one for Purchase
    Agreements, one for Big Deal Customers, one for tiered customers etc.
    All these prices might need to be available at the time the product configuration tool is accessed
    and definitely once the quote is created or maintained.

3. Quote Management (the quote that is handed to the customer needs to be setup in this tool
    - some tools are SAP CRM, BigMachines, Apttus
    When a legal quote is issued we need to be sure that we have for example

• correct customer data (e.g. Customer Number 1234 with address xyz)
• correct product data (e.g. for every SW license we need to have a service product)
• correct and approved prices (e.g. approved by Deal Desk if certain thresholds were exceeded, prices are VSOE compliant )
• Terms & Conditions have been approved (e.g. by Deal Desk)

The quote will be valid for a certain period of time, depending on the region (e.g. Americas, Asia) where it was issued. It could also be necessary that the quote is issued in multiple languages.

These first three processes and tools are also referred to as Configure/Price/Quote or CPQ. These are  sub components of the Quote-to-Cash Process and there are multiple Software companies that offer system solutions in this area (e.g. Apttus, BigMachines, Selectica, Cameleon Software, IBM Sterling, SAP, Oracle).

In order to prevent double work it is important to ensure that the processes and systems in the CPQ area are tightly integrated in the overall Quote to Cash processes and systems. (e.g. if BigMachines is used in the front end CRM tool it needs to flow smoothly to the SAP eCC ERP system). This is not a trivial effort and requires some serious investigation to come up with the best possible solution.

We will continue this overview next week (to come -->  Order Management, Licensing for Software companies, upfront Support for HW and SW products, Support Renewal quotes and orders, Consulting and Education Services, Enterprise License Agreements)