Upgrade your revenue lifecycle
Learn how configure, price, quote (CPQ) and contract lifecycle management (CLM) work better together.
When it comes to transforming business processes and increasing efficiency, tools like configure, price, quote (CPQ) and contract lifecycle management (CLM) provide critical functionality. CPQ gives companies the ability to configure complex product and service offerings into a personalized quote—and sell more intelligently. CLM lets businesses streamline contract processes, uncover hidden insights in their contract data, and mitigate risk.
What happens when you connect these two powerful solutions and allow them to work from a single, unified data source?
In this on-demand CLM and CPQ webinar, you’ll learn:
- The ins and outs of both CPQ and CLM processes
- The benefits of implementing technology to automate CPQ and CLM
- How CLM and CPQ work together to create a seamless connection between proposals and contracts
Understanding the CPQ process
CPQ is the starting point of the larger quote-to-cash process. As the name suggests, the basic functions within CPQ include configuring a proposal, setting a price, and delivering a sales quote.
While this might sound relatively simple, the reality is a bit more complicated. Within the quoting process, many organizations have to manage:
- Complex product offerings
- Regional pricing variations
- Frequent product and pricing updates
- Countless bundling options
- Unique customization needs
- Complex discount structures
- Partner or third-party products
- Revenue models that include products, services, and subscriptions
- High volume quotes
If your quoting system isn’t sophisticated enough to handle your go-to-market strategy or flexible enough to accommodate your complex product lineup, you’re likely to lose out on valuable deals. That’s where CPQ software comes in. CPQ helps the sales team sell the right combination of products, at the right price, with the right discounts applied—and automatically deliver quotes for customer approval.
CPQ solutions are designed to make sales reps more efficient, so they can deliver more proposals in less time—and more effective, so they’re winning more deals and leaving less money on the table. Customers who use Conga CPQ have seen significant, tangible benefits including:
- 25% increase in average deal size
- 33% improvement in quote quality
- 28% reduction in rogue discounting
Exploring the CLM process
Of course, implementing a CPQ solution is just one side of the equation, because quoting is not a standalone activity. Once the quote is delivered and approved, we move on to contracting—or CLM—which is the next segment of quote-to-cash. The basic functions within the CLM process include:
- Clause management, including any specific legal language that might be needed for individual products, services, or contract terms
- Contract generation, which requires populating a contract template with the right language and importing legacy contracts, if applicable
- Negotiation and redlining, which may require collaboration by both internal and external parties
- Approvals and signatures, including secure, efficient document delivery and electronic signing capabilities
- Amendments and renewals, which require storing documents in a secure repository throughout the life of the contract
In order to execute a contract successfully—and fulfill contract obligations correctly—you need to understand the contract at a granular level. That’s difficult to do without significant manual effort from the sales, legal, and finance teams—unless you have a CLM solution in place. CLM streamlines and automates the contracting process, while providing increased visibility into contract terms and obligations.
The true value of a contract lies in the data it contains—not the document itself. But contract data is only valuable if it’s accurate and complete, which is unlikely if your processes rely on manual data entry and disjointed systems. A CLM ensures your contract data will be stored in a central system of record where it can be accessed, analyzed, and manipulated to unlock meaningful insights. Customers who use Conga CLM report significant, tangible benefits including:
- 36% improvement in contract accuracy
- 32% increase in compliance
- 25% reduction in contract processing time
5 benefits of combining CPQ and CLM
Following are five key benefits of connecting CPQ and CLM for a seamless quote-to-cash process:
Accelerate timelines. We all know that time kills deals. A combined CPQ + CLM process streamlines the deal cycle, eliminates bottlenecks, and reduces the potential for human error, creating a better experience for both customers and employees.
Gain visibility into the deal cycle. Knowledge is power—especially when it comes to selling. A combined CPQ + CLM process provides full visibility into every stage of the deal cycle, and notifications at every status change ensure contracts move through the process efficiently.
Unlock the value of contract data. A combined CPQ + CLM process ensures your contract data is accurate, complete, and accessible so you can “connect the dots” to extract strategic insights, anticipate risks, and make proactive decisions to drive the business forward.
Automate the unimportant. In this day and age, no one should be spending time creating manual quotes and filling out contract templates. A combined CPQ + CLM process lets you automate repetitive, manual tasks so sales and legal teams can focus on work that requires their specialized expertise.
Enable self-service quoting and contracting. A combined CPQ + CLM process gives users the ability to use pre-approved pricing and legal language within a controlled system. This ensures that appropriate rules are followed and mitigates risk—without the need to involve legal.
Best practices for implementing CPQ and CLM
As you start your journey to an integrated CPQ and CLM solution, here are a few things to keep in mind:
Start with CPQ. In most cases, CPQ implementation should come first. The data from the quoting process is critical to contracting success, so take the time to get that right before you get started with CLM.
Avoid analysis paralysis. Implementing new software is complicated, and it’s easy to get overwhelmed. Our advice is to start small and move quickly. Get a solution in your users’ hands as quickly as possible so you can start deriving value from your investment right away.
Consider people, process, and technology—in that order. Your first priority should be ensuring that all stakeholders are aligned on a solution to the problem. Next, take a look at your current process to identify bottlenecks and eliminate inefficiencies—but be sure to keep stakeholders involved so the end process works for everyone.
Finally, select a solution that meets your needs. Technology should be your third consideration, because it’s expensive to implement a new solution or make changes once it’s in place. You’ll eliminate a lot of customization requests—and the related cost—if you’re not trying to accommodate misaligned goals and broken processes.
CPQ + CLM: the perfect pair
Clearly, CPQ and CLM are not two separate processes at all. Instead, they’re interconnected parts of the overall revenue lifecycle. Most of the data used to create a contract comes from your CPQ (and other systems). And contract data flows back into other parts of the sales cycle, to improve forecasting and power renewals, cross-sells, and upsells.
When you shift to this holistic mindset, it becomes clear that an integrated approach to CPQ and CLM is critical. The technology you choose should work together seamlessly and operate from a single, unified data model—as Conga solutions do.
Independent research firm Ventana Research explored the importance of automating the revenue lifecycle in a recent Research Perspective paper. They found that a smooth and automated process for quoting and contracting is key to a constructive buyer-seller relationship. (You can read this blog post for a summary of Ventana’s perspective.)
CPQ and CLM processes impact key areas across the organization, from sales and legal to finance and administration. Choosing products that integrate seamlessly will save you time, money, and frustration in the long run. Conga creates cloud-based quoting and contract management solutions that work together from a unified data model, to deliver operational efficiency at scale. For more information, please contact us.