Digital Transformation/
Lead to Order
Overview of Trends,
Complexity and
Transformation for Lead
Transformation for Lead
to Order Process
Next generation trends
• Everything is “Digital” • “Everybody On” • Connected Brand • Consumerization of IT
• Customer / Partner Self Service
Trends
Characteristics
Social
experience
Cloud
• Enabling the IT Infrastructure • Transforming the business
operations
• Monetizing differentiated services
Analytics
Mobility
• Energizing collaborative communities
• Interaction vs. Input • Real Time Automation
• Anywhere, Any segment, Any time • For Employees, Partners,
Customers
• Real Time tied to Execution Decisions
• Data Driven Process Optimization • Cross Enterprise Analytics
Macro trends
New trends in technology, delivery systems, financial models, and customer
expectations are driving companies in every industry to reevaluate how they deliver
value to their Digital Consumers
Key trends driving Digital Transformation
Mobility
gains prominence
Social media and
collaboration
On demand
computing
Digitization of
analog industries
Global economic
conditions
Evolution:
•
Phone calls
•
Emails
•
Web-browsing
•
Apps platform
Evolution:
•
Traditional
publishing
•
Social publishing
•
Web 2.0
•
Interaction
Evolution:
•
Self-hosted –
On-premise
•
ASP/hosted
•
BPO
•
SOA – SaaS
•
“Cloud” computing
Evolution:
•
Basic EDI/
Sharing info
•
Data/
business intelligence
•
Digital
asset strategies
Evolution:
•
Dot com bust
•
Global growth/BRIC
•
Global recession
•
Emergence from
Of the total US
2010 retail
market expected
to be transacted
online.
Estimated % of
traditional sales
that are now
influenced by
digital channels
Share captured
by the top 500
online commerce
companies in
2009, up from
13%
80%
94%
New trends
in technology, delivery systems, financial models,
and consumer behaviors are driving companies to reevaluate
how they invest in people, process and technologies
Forecasted US
online sales by
2014, up from
$155B in 2009.
(Goldman Sachs)
$250
Bn
online.
(Forrester)
influenced by
digital channels
(Google)
2009, up from
88% in 2008 .
(Internet Retailer)
US gov’t plans to
double wireless
bandwidth to
support growth in
mobile commerce
over next 10 years.
(WSJ)
Anticipated
growth for mobile
commerce
through 2015
(MarketResearch.com)
How these key trends are impacting our clients
“Big Data and Analytics”
“Big Data and Analytics”
Emerging
technology
trends
What our clients are looking for
Channels and
communities
engagement and
collaboration
Channels and
communities
engagement and
collaboration
New products
and services
innovation
New products
and services
innovation
Internal
business
operations
transformation
Internal
business
operations
transformation
Cloud-enabled
IT
transformation
Cloud-enabled
IT
transformation
“Cloud Computing”
“Cloud Computing”
“Mobility”
“Mobility”
“Social Media”
“Social Media”
“Big Data and Analytics”
“Big Data and Analytics”
Differentiating
the Experience
Differentiating
the Experience
Expanding the
Market
Expanding the
Market
Empowering
the Business
Empowering
the Business
Changing the
role of IT
Changing the
role of IT
Enterprise Agility
Enterprise Agility
Providing business value lenses for emerging technology
80%
of overall
IT spending growth
until 2020 focused
on cloud social,
80%
of overall
IT spending growth
until 2020 focused
on cloud social,
75%
of IT
organizations
without better IT
demand mgmt will
75%
of IT
organizations
without better IT
demand mgmt will
20%
of non-IT
Global 500
companies will be
cloud service
20%
of non-IT
Global 500
companies will be
cloud service
77%
of US CEO
surveyed are
changing their
strategy because of
77%
of US CEO
surveyed are
changing their
strategy because of
Cloud-enabled Business
Cloud-enabled Business
Energize Broader/ Diverse Channels Communities Energize Broader/ Diverse Channels Communities Innovate for NewProducts and Services Innovate for New Products and Services Transforming Internal Business Operations Transforming Internal Business Operations Cloud-enabled IT Transformation Cloud-enabled IT Transformation
•
How to scale my
infrastructure to
match my business
growth?
•
How do I save
money by moving
from Capex to
Opex?
•
How do I leverage
cloud technologies
to enhance my
business processes
quickly?
on cloud social,
analytics and
mobility
(IDC)on cloud social,
analytics and
mobility
(IDC)demand mgmt will
end up spending
more on IT, by 2015
(Gartner)demand mgmt will
end up spending
more on IT, by 2015
(Gartner)•
How do I compete
differently?
•
How do I transition
my products and
services into the
digital age?
•
How do I create a
new service
experience for my
customers?
•
How do I connect
with new markets
and segments?
cloud service
providers, by 2015
(Gartner)cloud service
providers, by 2015
(Gartner)strategy because of
customer demand
(PwC, 15thCEO survey)strategy because of
customer demand
(PwC, 15thCEO survey)What is Digital Transformation?
Digital Transformation
is PwC’s point-of-view on how enterprises need to adapt their
business models and operations to meet the
enhanced expectations
of the
Digital
Consumer
and ecosystem
Business benefits
Innovation
Enhanced
customer
Enabling a Collaborative Digital Enterprise
Strategy
Structure
People
Process
Technology
Consumer
loyalty
Innovation
and
Revenue
growth
Business
Agility
Operating
Performance
Cloud
computing
customer
expectations
New
business
models
Energizing channels /
communities
Monetizing
differentiated services
Holistic approach to empowering digital
transformation
PwC’s Transform™ framework for Digital Transformation
With Best Practice Business Processes
Product Development Regulatory & Policy Compliance Technology Licensing, Royalties, and Rights
People
Process
… Delivering 4 key
Solution Focus Areas
A
cr
os
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in
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es
A
cr
os
s
in
d
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ri
es
differentiated services
Transforming business
operations
Enabling cloud
infrastructure
… in 3 Core Service Dimensions
… in 3 Core Service Dimensions
Sales and Marketing Accounting Information Security Taxes and customs
Process
Strategy
Structure
Technology
Strategy and Planning
Strategy and Planning
Transformation
Transformation
Technology
Technology
A
cr
os
s
in
d
u
st
ri
es
A
cr
os
s
in
d
u
st
ri
es
Companies in the High-Tech and Other Sectors
Offer a Combination of Products and Services
Dumb Hardware Smart Hardware Bundled hardware & software Software Appliance Pure Software On-demand software On-demand services Hardware/ Software Continuum P ro d u ct V al u e P ro p os it io n Role of
add-on services Embedded Services(product support) Standalone professional services + productmaintenance/ support Solution design, integration anddeployment
P ro d u ct V al u e P ro p os it io n
Traditional operating model. Limited capabilities around hardware/ software combined revenue generation. Dependence on legacy install base data
Mature operating model. Enhanced capabilities enable multiple revenue streams within historical/ acquired operating silos
Evolutionary/ adaptive operating model. Integrated capabilities set along with extendable platform enable multiple revenue streams. Collaborative model enables ecosystem effect with partners
Complexity and Proliferation of Business Models is
Increasing Complexity in Lead to Order Operations
Customer Segments
Channels
Consumers
SMB
Government
Large Enterprises
Direct
Indirect
•
Sales Force
•
Contact Center
•
Website / eCommerce
•
Mobile
•
Distributors
•
Partner network (SI or ISVs)
•
OEM
Order Types
Revenue Drivers
Consumers
•
•
OEM
Resellers and VARS
•
Partner programs
•
Software licenses
•
Term
•
Perpetual
•
Subscription
•
Royalties
•
Volume licensing
•
Hosted solutions (SaaS)
•
Subscription
•
Usage-based pricing
•
Advertising
•
Services
•
Implementation
•
Training
•
H/W, S/W Maintenance
and Support
•
Upgrades
•
Tech refresh
•
Competitive trade-ins
Lead to
Stock
Assemble to
Order
•
SKUs/BOMs
•
Bundles
•
Solutions
•
Services
Engineer to
Order
•
3
rdparty products integration
•
Supply chain integration /
Lead to Cash View of Symptoms and Potential
Pain Points
NPI: Product Release Mgt
Lead/
Quote Order
Configure Pricing
Sales Contracts
Fulfill Invoice Bill Collect
Long time to market for NPI products; SKU proliferation
1 Lack of visibility through the
Supply Chain 8
Complex configuration process; inability to cross- and up-sell
2 Complex, manual billing
processes 9
Long quote turnaround time
3 Multiple, non-harmonized functional needs 10 1 3 4 5 6 2 7 8 9
Q2I Technology Platform
Data (Customer, Item, BOM, Price List)
Organization Structure and Roles
Operating Policies & Business Rules
Reporting & Analytics
12
Manual, non-scalable pricing and discounting
4 M&A activities are complex and
expensive 11
Lack of integration with contracts
5 Lack of integration across
systems 12
11
High percentage of non-standard pricing
6 Inaccurate reporting requiring
manual intervention 13
Complex and manual order validation and processing
7 Multiple sources of truth across
systems and functions/BUs 14
10
14
Lead to Order: Transforming Business Operations
NPI: Configurator Release Mgt
Q2I Operations Platform
Opportunity Quote Order
Configure Pricing
Sales Contracts
L2O: Structured Pipeline Management Quote Effectiveness Strategic Deal Management Quote-Contracts Integration
Attribute-driven Pricing Pricing Waterfall
Discount Mgt Integrated Release Mgt
Typical initiatives and focus areas (across operating
processes, systems and enabling data)
Lead to Opportunity, Quote to Order: End-to-End
View*
Q2I Operations Platform
Data (Customer, Item, BOM, Price List)
Organization Structure and Roles
Operating Policies & Business Rules
Reporting & Analytics
Contracts Lifecycle Management Pricing Exception Management (automated) Guided Selling Configuration Library Mgt Order Lifecycle Mgt (integrated view) Integrated Enterprise Portal
Customer 360/ Customer Data Mgt
Differentiated Transaction Flows Integrated Q2IO Organization
Metrics: Strategic, Operations/ Functional &
Execution
*Complex ecosystem of Customers, Partners, Sales & Support Ops; BIC characteristics include seamless user experience, robust processes and highly integrated systems enabled by high-quality data
Lead to Order - Process Excellence and Leading
Practices
Register
Opportunity
Draft
Quote
• View Rev Rec
impact &
approval matrix
real time
Obtain Pricing &
Discount
Approvals
• Automated
workflow
• SMB should not
require approval,
Draft & Approve
Contract
• Standard T&Cs
embedded
• Changes in select
T&Cs trigger approval
Order
Management
& Fulfillment
• Contract data
transmitted to
order
• E-fulfillment
Customer
Master Files
Product
Master Files
real time
• No duplicates allowed
• Credit limit
pre-established
require approval,
and follow a
scalable pricing
& discounting
program
T&Cs trigger approval
requirements (workflow
driven)
• SMB contracting
simplified with
web-based click2accept
solution
• E-fulfillment
triggered
• E-Invoice
triggered
Auto Renewal
Recurring
Billings
Metering
Engine(s)
• Inactive SKUs
archived
• SKU quality
maintained
Pricing &
Discounting
Programs
Lead to Order - Key Performance Metrics
Register
Opportunity
Draft
Quote
Obtain Pricing &
Discount
Approvals
Draft & Approve
Contract
Order
Management
& Fulfillment
• Opportunity
pipeline
• Bookings to Revenue
reconciliation
• Discounting stats
• Approval
cycle time
• % of non standard
T&Cs
• Cycle time
• Order management cost as a % of revenue
• Customer purchasing satisfaction rate (%)
• QTC cycle time
• Sales rep customer facing time (%)
Customer
Master Files
Product
Master Files
Auto Renewal
Recurring
Billings
Metering
Engine(s)
• Customer
duplicates (%)
• Inactive SKUs
(%)
Pricing &
Discounting
Programs
Typical Impacted Metrics in a Q2C Business
Transformation
Our clients have achieved step-level performance improvement on critical lifecycle
metrics:
PwC has executed several Q2C transformation projects for high-tech
companies spanning several business models and routes to market
PwC has executed several Q2C transformation projects for high-tech
companies spanning several business models and routes to market
•
Total Revenue: 10–15% increase
•
Customer Satisfaction: 10–20% better
•
Quote-to-Order Cycle Time: 30–60% reduction
•
Deal Conversion Rate: 10-15% more
Extensibility, Scalability, Market Responsiveness
•
Customer Satisfaction: 10–20% better
•
Sales per Customer: 10–15% higher
•
Gross Margins: 5-10% higher
•
Sales Cycle Time: 25–50% faster
•
Headcount Optimization: 5-10% lower
•
Cross-/up-sell: 20-35% increase
•
Deal Conversion Rate: 10-15% more
•
No Touch Order: 30- 50% higher
•
Cost of per Order: 15-20% lower
•
Non-standard Pricing Approvals: 5-20% reduction
•
NPI Time to Market: 10-30% reduction
Segmented Order Flow Diagram
A segmented transaction flow constitutes the core of the sales
operations processes leading to a cost-effective channel enablement
Major Business Capabilities
• Strategic deal desk and pursuit teams • Transactional deal desk
• Segmented pricing strategy with set approvals for direct and channel deals (attribute-base pricing, pricing waterfall, price list
management, promotions)
Complex Customer Pre-Sales
Defin ition Ensure feasibility of non-standard configurations
Architect cross-product solutions (e.g., HW and service offering) to meet customer needs Identify solutions which can be reused as a
packaged solutions and baseline configurations
Review proposed discount Assess deal margin
Coordinate cross-product group pricing decision (e.g., low HW margin to secure overall high margin sale)
Exception Management Technical Pre-Sales
High Touch Model
Segmented Order Flows
management, promotions) • Exception management
• No-touch order submission and verification • Automated leads assignment
• Deal registration
• Sales contracts integration (including ELA/ESA)
• Quote and Order lifecycle management • Guided selling and configuration
library management
• Centralized Quoting operation team • Rule-based configurator with solution
selling capabilities
• Unified user experience with single point of entry for Juniper and Partner users
Front-end Quoting Tool
Guided selling capabilities (user responds to a few upfront questions) Expert and Novice con figuration modes
Not complex
Defined pricing models with set pricing by categories to achieve internal margin targets
Online real-time standard pricing with what-if analysis for the customer packaged solutions and baseline configurations
Predefined solutions (i.e., starting points) Suggest configuration
based on recent order history, margin, and performance thresholds
Apply applicable standard and contract discount rate Incent purchase of
specific configurations through special pricing
Order at the SKU level (e.g., HW, service) Capture deal and order
information upfront (e.g., terms and conditions) Minimize and automate
post order checks overall high margin sale) Approve/reject discount exception
Low Touch Model
No Touch Model
Next Gen
Configurator Standard Pricing Order Mgmt
Standard Pricing
Front-end
