How does a configure-price-quote (CPQ) system enable faster training of new salespeople and quicker organizational growth?
Lack of Product Knowledge Can Impede New Sales Reps
Employers can’t afford to spend two years educating employees that, according to the Bureau of Labor Statistics, will likely stay for less than four years.1 Salespeople come onboard with basic knowledge. The sales management team teaches the new sales reps about the unique aspects of selling the company’s products. Technology fills in the blanks.
Training New Sales Reps Faster is Better for Them and the Company
Frankly, prospective sales reps aren’t interested in long training cycles either. Being able to promise the new rep quicker access to the revenue- and income-generating aspects of their job is a real advantage when you are trying to attract the best sales talent available.
The fact is slow onboarding and training processes aren’t conducive to growth. Faster onboarding should be the sales organization’s goal. As the company expands into new regions and verticals, more sales staff are required. There simply isn’t time to bring a new salesperson up to the level of a seasoned veteran within the organization.
Today, the expectation is to be instantly effective on selling many products. Most sales organizations carry larger portfolios with more product variability aimed at more diverse markets. Customers still demand sales reps with specialist capabilities, but economics are requiring companies to field sales reps who generalize.
Entrenched sales forces trying to make this transition are subject to high turnover. Studies show that B2B companies undertaking single-product to multi-product portfolios are experiencing turnover rates as high as 60 percent in less than three years.
Whether a company is training new hires or re-training an existing sales force, product knowledge is the constraining factor in transforming sales talent into effective selling professionals.
Guided Selling and CPQ: A Smart Combination that Leads to Sales Success
So, how do new onboarding sales staff gain the product knowledge they need to succeed? The short answer is: they just need to know how to read.
CPQ solutions provide a repository for all product data and pricing. Guided selling prompts within the interview functions of the CPQ solution guide the sales rep and the customer through the process of evaluating the customer’s needs and matching those to assorted selection choices.
Complex products typically require a decision tree of choices, options, materials used and features selected. These are presented as a menu-driven script to be followed as the needs and requirements are discussed between the seller and buyer.
If a sales rep can read the script and the customer can answer the questions, the job will get done effectively. Product knowledge is built into the CPQ system. The sales rep’s doesn’t have to rely on his or her memory.
Guided Selling Scripts Come from Tribal Knowledge
The knowledge of employees in the company—the ones with product and application knowledge—create the guided-selling scripts. The scripts eliminate the misapplication of product to inappropriate use and ensure that the product matches the customer’s needs and specifications.
Sales managers don’t have to haul the new hires into a room for weeks of product familiarization. They don’t have to pull in the entire sales force for an all-expenses-paid week in a hotel learning about new products, pricing models or new features.
CPQ Enables Salespeople to Handle Complex Pricing Models
Pricing models can be as complex as necessary to align price with value delivered. The pricing calculations can accommodate different types of customers such as GSA or national-account, discount-eligible customers.
Volume price breaks and other scaling metrics can be built into the pricing model and automatically calculated as quantities are entered. The calculations and the invocation of the specific applicable discount calculations are automated based on quantities and customer classifications associated with that opportunity.
Sales reps will not need to learn obscure formulas or consult complicated charts or other tools to correctly apply pricing models; CPQ does the learning and the quoting.
People look for flexibility in pricing. Valid pricing tries to match price with value delivered. The problem with complex pricing is that it is frequently abused to justify a discount that really has not been earned.
Productive New Hires and Existing Sales Pros
Sales managers don’t have to teach the complex pricing structure to new hires. The pricing model is built into the guided selling interview questions. The customer’s answers transparently drive applicable discounts. This type of updatable intelligent CPQ application serves veteran reps as well.
Pricing, products and modified or expanded product lines are all accommodated by the updatable CPQ functionality. As new sales forecasts drive new pricing plans and new product development drives improved products and new options, CPQ reflects these changes. The sales force does not have to spend a week at corporate every year learning the ropes for the modified product line.
Pricing and product updates can be summarized in short memos; examples are provided; and CPQ is updated to reflect the change. This means more time in the field, less time learning, more sales and a more efficient, effective sales force.
People who sell products for a living do not like to spend time learning complicated product lines, pricing structures and other esoteric information related to the job. For new hires, CPQ enables a fast path to sales revenue production. For valuable sales veterans, CPQ promises minimal time in the field and maximum opportunity to generate revenue.
CPQ Provides Competitive Advantages
In the highly competitive marketplace of attracting the best sales personnel, CPQ provides a distinct advantage over competing companies and faster access to productive selling opportunities. The best sales reps don’t care about plush offices or winning steak knives; they want an opportunity to move products and generate commission-paying revenue.
A sales manager’s ability to quickly and effectively train new onboarding sales reps to productive levels allows an organization to grow and succeed as it sets its sights on new opportunities.