Configurable products and services start with base elements that are then packaged, customized, or produced to customer or client specifications to allow the buyer choices that best fit their needs and make the complex process simple for the manufacturer or service supplier.
There are often significant breakdowns in the configure-price-quote (CPQ) processes to support configurable products.
The biggest breakdown for manufacturers is the practice of creating a unique bill of material for each order configuration.
Is it a hoax or a cover-up? Sometimes it doesn’t matter. The word “hoax” has been used to dismiss factual situations. “Hoax” means “a humorous or malicious deception.” Characterizing something as a hoax can also be a means of covering up a legitimate concern that needs to be addressed. A hoax or cover-up can actually be a legitimate threat to the future of a business.
What executives with configurable products & services want for their businesses, employees, and customers.
-Increased market share
-Delighted customers
-Improved quality
-Improved operating margins
-Differentiation/Competitive advantage
-Lean the business–eliminate waste
-Happy employees
The downside of bundled products and services? What happens when a consumer is limited to buying in bundles? Friction! Friction means the buyer is looking to replace you. Offer A La Carte Customer® business model instead.
If you wanted to start a company that offered highly-configurable products, the worst business paradigm you could select would be engineer-to-order (ETO).
There is conventional thinking for durable competitive advantage during normal economic conditions, but I’ve added 2 action steps for durable competitive advantage during economic crisis, like this Covid-19 economic crisis.
Recurring Operating Challenges That Affect Customer Satisfaction and Profits
A decade ago, I wrote an article in Fast Company called We Offer It, You Buy It; Take It Or Leave It. Here’s how I kicked off that article: Does the headline of this article represent an attitude that customers are drawn to? It sounds like a customer strategy taken Read more…
The problems with off-the-rack CPQ software solutions are in what the software doesn’t address. The vendor application you chose is a small part of the solution.
Configurability and the back office black hole happens if no guidance is offered in the ordering process. Imagine going into a restaurant that merely tells you they serve “food.” They provide no insight into the type of food they serve. They simply ask you to tell them what you want. Read more…