The Perils of Piecemeal IT Solutions
A reprint from MetaOps Magazine
Warning: Piecemeal IT solution like configure, price, quote (CPQ); customer relationship management (CRM); or other front-office technologies—could be hazardous to your business.
Piecemeal IT solutions is characterized by unsystematic partial measures taken over a period of time. Unsystematic—that’s the part that gets you in trouble.
Smart companies don’t have software initiatives; they have business initiatives that drive software purchases. When you don’t have an overall business strategy for your front-office process, you unsystematically collect IT solutions.
Here’s how piecemeal IT solutions can harm you:
You’ll only be able to offer products, not solutions
Customers today are looking for large companies to deliver solutions instead of products. For example, I know a manufacturing company where one of its divisions sold products that overlapped with those of another division. The products were sold together by the same salespeople. If each division bought its own technologies (the piecemeal approach), it’d be more difficult to sell since salespeople would have to go to multiple systems to get the information they need.
The goal for every business should be “ease of doing business.” Make sure that all of your company’s products integrate. Make sure that all of the knowledge around those products is integrated so that your salespeople can sell them easier. When you have disparate tools, you can’t do that, since they often don’t integrate together.
You’ll pay for duplicate technology
Workflow, dashboards, reporting, analytics … if you piecemeal IT solutions, you’ll eventually replicate many of these functions. You’re going to have to manage that replication somehow. Worse, the tools won’t work across the whole process. For CPQ to work best, it should sit on top of your CRM master data: your customers, your products, etc. You have to have certain functionality that you want to go across all systems. Ideally you’d have one repository.
You’ll find it hard to track your dealer channels
The larger you become, the harder it is to keep track of dealers’ pipelines and forecasting your own sales. If you piecemeal solutions, not only will you be duplicating functions, you may be missing some as well.
For example, aftermarket service can be a large portion of revenues for a manufacturer. While a CPQ system can provide many sales functions, it doesn’t usually have a services module; but CRM does. It also has a marketing module to help dealer offices.
The solution: choose a platform
The front office is a business process; it’s how you market, sell and service your customers. You shouldn’t have a CRM team and an engineering configuration team, or a separate pricing or estimating project team. There should be one team determining and implementing strategy for the entire process.
One Cincom customer, a manufacturer of power-management solutions, had a business initiative of making it easier for people to do business with them. From a business perspective, they realized they needed to integrate products, data and processes across multiple divisions. They chose not to buy disparate tools. Instead they chose a CRM platform—Microsoft Dynamics® CRM—that they could easily extend by adding CPQ and others functions. This made it easier to scale, reduced duplication and reduced the staff power needed to maintain it.
Another Cincom customer, a maker of industrial cranes, realized the perils of piecemeal and chose a similar platform approach. In a four-year period, this company consolidated more than 40 systems into less than seven.
Smart companies consider their front-office processes strategically. How smart are you?
Source: Smart Selling