Configurator Software Facilitates Effective Risk-Management Processes
Risk-management processes are important to business because risk is what business is all about. Risk elevates or lowers the value of products or services depending on the perceived level of risk involved. A veterinarian specializing in the care of family dogs and cats is likely to make less than a vet specializing in venomous reptiles. Configurator software may help to solve key business problems.
Successful businesses understand that risk can be their friend if it is managed properly and understood fully. Configurator software is helpful to both sellers and buyers in mitigating risk by helping both parties in a buying cycle fully understand what the buyer needs and what is being sold to fulfill that need.
When companies invest in new products, they frequently are looking at solving an existing problem, but also, they have the foresight to look down the road at potential changes or developments that might affect their use of the product being purchased. Savvy buyers aren’t going to base their buying decisions solely on a current set of circumstances. Risk management extends to minimizing risks associated with product acquisition.
Sales folks do not have the expertise to volunteer those types of knowledge points because to do so requires domain expertise that only the buyer has.
Playing the “What If . . . ?” Game with Configurator Software
If you are buying cargo trailers for industrial use, you no doubt have a laundry list of specific needs. Your immediate need is for moving mined ore from the extraction point to a railhead located on your property. Your trucks circulate from the mine to the railhead all day long. They never leave your property, and they never carry anything other than the product of your mining operations.
So, what is the risk? Just buy the trailer that handles the weight, is durable and works with your existing loading and unloading equipment, right? Well, maybe not.
This is where buyers start thinking in terms of the future and how changes might make this investment look less than wise. What happens to your trailer investment when things change?
Here are some examples:
What if …
… we move our mining operation?
- Are these trailers legal for use on public roadways?
- Do they meet requirements for interstate transport of our product?
- What modification is required to operate them off property?
Configuration software has the answers to these questions. Options like running lights, brake lights, structural reinforcements and cargo notices are all selectable within CPQ software. More importantly, onboard scripting will guide your conversation down the option tree to ensure that all possible scenarios are examined.
… we change our business?
- Can we use these trailers to ship foodstuffs?
- What is involved in modifying the units to handle other cargo?
- Such as liquid?
- Such as frozen products?
- Such as hazardous material?
These types of options involve many different modifications. Regulatory law is frequently at play whenever food or hazardous material is involved. If you require this level of flexibility, it is essential that you have configurator software with the robust capabilities necessary to support regulatory as well as functional capabilities.
… we change our supporting technology?
- OSHA regulations may affect the transport of our product; can we modify to accommodate?
- Our rail partners may be changing their rolling stock; can we adjust to their needs?
- Can we lease these and return them at the end of the term?
There is no technology that will predict the future reliably. But, configuring a system that accommodates a generous level of flexibility toward future change is possible. Changing regulations, technological developments and evolving practices all affect the future utility of technological acquisitions. Careful examination of your options via product configuration software will increase the useful life span of your investment.
For any of these questions, configurator software will help the buyer and seller explore options in terms of addressing risk-management needs associated with making this purchase.
Embrace risk. Risk drives reward. Effective risk management makes risk work for you.
There is a legend about FedEx founder, Fred Smith, early in the formative days of FedEx. Coming up way short on operating funds for the coming week, he had to sneak off to Las Vegas with company money in an effort to raise needed dollars for the company to make payroll. Configurator software will help you manage risk effectively. No one wants to make the kind of stomach-churning gamble that the FedEx chairman had to make.
Invest in product configuration software, and stay away from the blackjack tables.