about the report of qtc 2016 v3.pdf · the state of quote-to-cash report is an annual study...
TRANSCRIPT
The State of Quote-to-Cash Report is an annual study conducted by
Apttus on how the best companies harness Quote-to-Cash and front
office solutions to drive greater efficiency, revenue, and speed.
The information presented is collected from a panel of executives
customers, analysts and industry experts.
ABOUT THE REPORT
/01
It’s so simple to dream big, isn’t it? Step back for a moment and it’s
so easy to see the path from where your business sits, to where it
should be. Solve a problem or two, sign a key deal, attract more
customers and outpace your competitors. What’s stopping us?
Surely the nitty, gritty details and logistics aren’t that insurmountable,
although they may feel that way.
The complexities and details of running a modern business demand
your attention at every opportunity. They hold up sales cycles, they
bog down contract renewals. They can even trip up your entire
business if you’re not paying careful attention at every step.
That’s not how it should be: your dreams shouldn’t be at the mercy
of a mundane, manual system. I have merciful news: as of very
recently, they are not. The age of digital business is in full swing,
and if you think you’ve seen advancement so far, just wait until you
learn what’s coming next. Your dreams are back in the driver’s seat.
THE CURRENT STATE
KIRK KRAPPE Chairman & CEO, Apttus
/02
WAY OF YESTERDAY
It’s important to understand how we got here, to better determine where we are going, and how we
should get there.
Although much of the world around us is changing, the heart of your business’ Quote-to-Cash cycle
has not. Quote-to-Cash connects a customer’s intent to buy and a company’s realization of revenue,
and encompasses the entirety of your sales, contract, and customer relationship lifecycles.
Traditionally, companies have struggled with these processes, relying on manual, siloed procedure
within separate tools and across different platforms. Quote-to-Cash has a long history of being
incredibly inconvenient, time consuming and disjointed. But there is absolutely no need for it to be that
way.
The information within your sales quote is the same information that dictates contract negotiations
and contract management. It is the same information that guides your billing, revenue recognition,
rebates and deliverables processes. That same information, if harnessed, also holds the keys to
upsell and cross-sale opportunities, happy customer relationships, and future success in new deals.
So why on Earth do we insist on doing it all separately?
Automating Quote-to-Cash not only creates a streamlined, cohesive process, but provides uniformed
data and insight necessary to drive successful business outcomes. Take the next leap forward.
Copyright © 2016 All rights Reserved
/03
WAY OF TODAY
Digital Era: The Third Great Revolution in Business Technology
It’s a digital world, one characterized by hyper-connectivity, ubiquitous
information, and increasingly capable technology. These trends are
dramatically influencing the way we do business and the way we live, allowing
for greater operational agility, innovation and customer value.
What we are experiencing is quite possibly the third great revolution in
business technology – the first being the internet, the second being SaaS and
PaaS business models which opened the door for massive innovation and
expansion of cloud capabilities. We are now at what Gartner refers to as the
“Cloud Office Tipping Point,” the culmination of Internet of Things, advanced
analytics, artificial intelligence, and new front office adoption, creating a launch
pad for faster, smarter, adaptive business.
Forrester, in a recent report, writes “Digital has transformed the market
context for every business, and the pace of change is accelerating.” It has
blurred the lines between buyers and sellers, customers and companies,
personal and professional. We are now forced to rethink the relationships
between traditional business departments, job functions, and business
processes. It’s cause for excitement, cause for some concern and even
cause for some confusion. Above all, however, it’s cause for change.
“SOMETHING momentous is happening
in the software business. Bill Gates of
Microsoft calls it “the next sea change”.
Analysts call it a ‘tectonic shift’ in the
industry. Trade publications hail it as
“the next big thing”. It is software-as-a-
service (SaaS).”
Software: Universal Service?
(Economist, 2006)
Blast from the Past: The 2
Previous Tech Revolutions
“The storm that's arriving—the real
disturbance in the force—is when the
thousands and thousands of institutions
that exist today seize the power of this
global computing and communications
infrastructure and use it to transform
themselves. That's the real revolution.”
Business and the Internet: The Real
Revolution (The Economist, 1999)
/04
QUOTE-TO-CASH:
GATEWAY TO THE DIGITAL ERA
It’s a customer-centric world. The growing push for SaaS based
business models means a majority – some predict as much as
80% - of your business comes from renewals and existing
customers.
The ability to accommodate your buyer’s needs in today’s digital
landscape requires more than a simple tweaking of your internal
processes; it requires total transformation of the way you go from
quote to cash.
When Quote-to-Cash is managed correctly, businesses are
empowered to confidently adopt new business models, predict
quarter outcomes, and meet increasingly complex customer
demands—without introducing delays or risk.
Quote-to-Cash strategies and solutions will make customers
the focus of your revenue strategy.
“By now you’ve surely heard that moving forward, every company will be
a software company, and that shift is happening now as companies large and
small scramble to transform into digitally-driven organizations.”
Source: Digital Transformation Requires Total Organizational Commitment, Tech Crunch
/05
QUANTIFYING QUOTE-TO-CASH
Companies that have automated their Quote-to-Cash process have seen:
105% Larger Deal Size
49% Higher Proposal Volume 17% Higher Lead to
Conversion Rate
28% Shorter Sales Cycles 26% More Reps Achieving Quota
/06
60% Improvement in Contract Cycle Time
You don’t need to be a mineralogist to know that diamonds are forged under extreme forces and
pressures. While these digital changes are taking place at an incredible rate, they shouldn’t be
unforeseen, and they shouldn’t be dreaded. The forces pressing in on your business present a
diamond opportunity. Here are several key market pressures are working in unison to drive both the
digital era and the rise of Quote-to-Cash technology.
The first two pressures are very much interrelated. Why do you think people prefer streaming Netflix
over watching live television with commercials, or Uber over hailing a cab, or online shopping to brick
and mortar stores? That’s because people want things right away, and they want it to come to them.
1. Instant Expectations – The internet, smart phones and connected devices have all trained
us to expect things – whether it’s answers, information, or communication – to come instantly.
Patience is no longer a virtue. A 2013 study examined the video viewing habits of 6.7 million
internet users. If the video didn’t play within 2 seconds, viewers began to abandon. By 10
seconds half of all viewers had closed the window. What is frightening, in the time since, our
expectations have only grown more demanding. In fact, currently there is a new generation of
employees gradually entering the workforce, who have never had to wait because they grew up
with iPhones, YouTube and social media.
PRESSURES FORMING THE
QUOTE-TO-CASH DIAMOND
/07
2. Convenience – In line with instantaneity, is convenience. You need to be able to come to your customers, meet
them on their terms. With the excess of information available, by the time customers finally do interact with a sales rep,
they are already 75 to 95% of the way done with their transaction. They’ve researched, paired needs with solutions, and
matched pricing with budget. It’s a buyer’s market and customer service and convenience are a premium. A habit of good
service will bring business to your doorstep. Poor service will lead to extinction. Barriers of entry are low and competition
is extremely high. If you can’t meet customer expectations, they will simply go elsewhere.
The third pressure is really the sum of the first two. Because of these expectations, speed is critical. We live in real-time;
it’s important you sell in real-time as well.
3. Speed is the New Big – This instant world allows smaller companies
to compete with larger ones. Ironically enough however, speed also allows
large companies to maneuver alongside and compete with small agile ones.
It’s really a matter of delivery.
As Kamal Ahluwalia, Apttus Chief Revenue Officer, explains: “Speed is the
currency of modern business. Not only that, it’s the most common
differentiator among competitors. Think about your organization’s ecosystem.
The most reputable companies aren’t necessarily the biggest. However, they
are likely the easiest to work with. The key to this type of maneuverability is
simple: automating predetermined decisions, improving organization wide
communication funnels, and enabling clear and quick decision-making
processes.”
/08
EMPHASIZING THE IMPORTANCE
OF SPEED: QTC MEETS THE NBA
To emphasize the importance of speed, we’ve brought in a
comparison of basketball superstars: Shaq and Steph Curry.
During the 1990’s to early 2000’s Shaq was a dominant force
in the NBA. Standing 7’1” and weighing 325 pounds, he was
immovable and virtually unstoppable. He hauled in 4 NBA
titles, 3 NBA Finals MVPs and 2 broken backboards. Shaq
was the epitome of that era of basketball, big man dominant,
body people out of the way, control the boards and control the
game.
Today, the NBA is all about Steph Curry. He is an
undersized guard who was consistently overlooked,
regarded as too short and too frail to be successful to play
professional basketball. He looks more like an everyday
person than an NBA superstar. But his style of play is
electric and unrelenting. He plays high pace, high energy,
up and down the court basketball characterized by
excellent dribbling, passing and of course shooting. He
scores from almost anywhere in an unending variety of
ways.
Steph Curry is redefining the way basketball is played. One
in which size is irrelevant. It’s about speed, agility and
adaptability. The advantage, much like in digital business,
comes from speed. It’s in the moment adjustments and
reactions that provide the edge, not size. Big companies
can’t box out smaller ones any longer.
/09
Steph Curry
Shaq
The digital transformation is already underway, and is helping decide the
market’s winners and losers. If you aren’t digital you are playing catch up
because 3 of your most critical areas impacting your business have already
made the transformation:
1. Your Customers are Digital
2. Your Channels are Digital
3. Your Competitors are Digital
Here is a look at some key trends and statistics shaping the world around us.
These figures come from Martin Gill and Nigel Fenwick of Forrester
Research’s recent report “The Digital Business Imperative Vision: The Digital
Business Transformation Playbook”.
/10
MAKING THE DIGITAL LEAP:
WHY IT’S TIME FOR A CHANGE
.
›› YOUR CUSTOMERS ARE DIGITAL
• Digital technology powerfully changes how customers
experience products and what they value. We are entering
an era of hyper-adoption and hyper-abandonment in which
consumers flock to, and flock away from, new digital
experiences at unprecedented rates.
• The number of global smartphone subscribers will reach 3.6
billion by 2020, with more than half the world’s population
owning one by 2017.
• More than 50% of US B2B buyers prefer to research
business purchases online rather than engage with
salespeople, and 75% say that buying online is more
convenient than other channels.
• Facebook and YouTube now both boast more than 1 billion
users worldwide. Twitter has 1 billion unique visits a month.
/11 Copyright © 2016 All rights Reserved
›› YOUR CHANNELS ARE DIGITAL
• Digital has transformed the ways in which
customers discover, buy, and engage with products
and services, allowing them to transcend traditional
channel boundaries.
• 67% of all email opens occur on mobile devices
• 30% of B2B purchases are completed online. That number is expected to double by 2017.
• By 2018, we expect web-impacted retail to account
for 53% of all US retail sales, and 13% of all sales
will be online.
• By 2020, we expect B2B e-commerce sales to top
1.13 trillion by 2020
/11 Copyright © 2016 All rights Reserved
›› YOUR COMPETITORS ARE DIGITAL
• Digital disruptors challenge your business model as
they engage your customers in new ways. They can
quickly win market share and grow from startups to
critical players in a few years.
• General Electric (GE) believes that digital business
will add $15.3 trillion to global GDP by 2030.
• 63% of firms are either at an “early implementation”
stage or “plan to launch in 6-12 months” digital
initiatives.
• Unless your firm can learn to think and operate like
a disruptor, you won’t see the potential for disruption
until it hits your business. Your choice is to evolve to
become a disruptor yourself or watch your market
share tumble.
®
/13 Copyright © 2016 All rights Reserved
“The executive suite has to have a clear plan for the
future, and a way to put the company on the road toward
delivering on that vision. They can’t hide the innovation
team in the basement.” - Ron Miller, Digital Transformation Requires
Total Organizational Commitment
/14 Copyright © 2016 All rights Reserved
BUILDING A DIGITAL ADVANTAGE
WITH QUOTE-TO-CASH
1. Cohesiveness – Quote-to-Cash allows you to fluidly link your critical data and processes. As the single link
between top-line growth, bottom-line results and customer satisfaction, Quote-to-Cash relies on the collective
intelligence of the enterprise. The impact of accurate quotes, proposals, contracts and orders make the flow of all
data and processes within business work smoothly, thus creating value for companies and their partners and
customers. When Quote-to-Cash is a disconnected series of events, measuring any impact across different
processes is nearly impossible. With a single process and data stream, companies can easily and accurately
measure effectiveness across their entire customer lifecycle and take steps to optimize.
2. Greater Insight - With Quote-to-Cash, there is a plethora of available historical data tied to your sales
deals, contracts, revenue, and procurement. By leveraging this data with predictive analytics you’ll not only have
greater insight into real-time processes, but be able to accurately anticipate change before it happens. Quote-to-
Cash solutions are now capable of learning from your historical behavior, business rules, and revenue goals in
order to recommend next step actions and rapid what-if scenario planning. The result will be increased visibility,
improved decision quality, and maximized ROI.
3. Agility – With this level of insight and machine learning your business is more agile. You’re not just looking at
more efficiency with internal processes, but greater deal velocity which will drive your revenue growth.
/15
The following three companies were willing to make the
leap to digital and adopt Quote-to-Cash. Here is a look at
their stories, their leaders, and their success.
2016 QUOTE-TO-CASH
COMPANIES OF THE YEAR
/16
"Efficiency gains and improvements in our sales process thanks in part
to Apttus CPQ and Contract Management have contributed
to a 20% reduction in cost of sales over the past two years.”
Larry Dunivan, Executive Vice President of Sales,
Ceridian HCM
2016 QUOTE-TO-CASH
COMPANIES OF THE YEAR
Copyright © 2016 All rights Reserved
®
/17
“From day one of our global
deployment to users in over 20
cities, Apttus, on the Salesforce1
platform, helps delight our internal
and external customers, processing thousands of quotes daily.”
Meredith Schmidt, EVP Global Revenue
Operations, Salesforce
2016 QUOTE-TO-CASH
COMPANIES OF THE YEAR
Copyright © 2016 All rights Reserved
®
/18
““[Quote-to-Cash] enabled us to
launch an innovative engineering
application that reduces the cycle
time of configuring custom
processes from days to minutes,
improving our responsiveness to
customer inquiries and reducing manual mistakes.”
King Ou, Director of Systems and Solutions,
GLOBALFOUNDRIES
2016 QUOTE-TO-CASH
COMPANIES OF THE YEAR
Copyright © 2016 All rights Reserved
®
/19
WAY OF TOMORROW
1. Omnichannel Strategy – Omnichannel strategy, which many oversimplify as online sales,
connects the dots between online and in-person experiences to ensure total brand consistency across
all channels. It really offers omnipresence with your customers. Digital businesses need flexibility to
sell and communicate with each of their audiences differently, providing instant access to products,
self-service, knowledge communities and highly personalized content. Connectivity is breaking down
the very concept of individual channels and opening the opportunity for seamless experiences.
2. Touchless Business - Advanced Quote-to-Cash systems will ultimately enable touchless (or
frictionless) sales. Integrated, automated Quote-to-Cash featuring sanctioned contract templates and
intelligent guidance empowers sales reps to assemble and price optimal deals on their own, from any
location at any time. In the same sense that Tesla is pioneering driverless cars, we hope to develop
driverless business. Cognitive and machine driven solutions, providing hands free and frictionless
processes, so you can remain agile and focused on strategy not procedure.
/20
/21
ABOUT QUOTE-TO-CASH
Quote-to-Cash is the vital business process that connects a customer’s interest in a purchase to
the realization of revenue. It includes creating a quote, responding to RFXs, submitting a
proposal, negotiating and managing a contract, fulfilling orders, recognizing revenue, ensuring
compliance and tracking payments – all within visible and controlled workflow. Quote-to-Cash
solutions include Configure-Price-Quote (CPQ), Contract Lifecycle Management (CLM), and
Revenue Management applications.
Quote-to-Cash is the single link between top-line results, bottom-line results and customer
satisfaction. No other process is as critical for maximizing the value of capturing revenue in a
profitable way as well as meeting the needs of customer sales requests. This process relies on
the collective intelligence of the enterprise. The impact of accurate quotes, proposals, contracts
and orders make the flow of all data and processes within an enterprise work smoothly, thus
creating value for enterprises and their customers.
ABOUT APTTUS
Apttus, the category-defining Quote-to-Cash software company, drives the
vital business process between the buyer’s interest in a purchase and the
realization of revenue. Apttus is delivered on the Salesforce App Cloud, the
world’s most trusted and comprehensive cloud delivery infrastructure.
Applications include Configure Price Quote (CPQ), Renewals, Contract
Management and Revenue Management. Additionally, Apttus’ patent
pending X-Author technology enables Microsoft Office to be a user-
interface with full interaction and control between Salesforce and Microsoft
Office. Apttus is based in San Mateo, California, with additional offices
located across the globe. For more information visit: apttus.com.