Whitepaper: How Parametric Graphical Configuration Solves the Problem of Complex Selling
This white paper is a resource for designers, dealers and sellers of component-based product systems. While this paper’s focus is on the Commercial Furniture industry, it also has application for the Kitchen & Bath, Material Handling and Industrial Machinery markets. In this paper, we:
- Discuss the challenges of selling complex, configurable products;
- Explain the competitive advantage of using a Parametric Graphical Configuration (PGC)-based software solution to solve the problem of complex selling; and
- Explore how to strategically introduce and successfully implement PGC-based software in an organization.
Today’s selling challenges
“Mass customization” became a key business strategy starting in the 1990s: Manufacturers in such industries as Commercial Furniture, Kitchen & Bath, Material Handling and Industrial Machinery began producing configurable, parametric system products that could be assembled and sold in multiple combinations.
Characteristics and challenges of configurable, parametric system products
- Systems extend into three-dimensional space
- Systems are comprised of parametric components Components are defined by parametric relationships
- Functional product rules define how the components can be joined
- Components may have a number of variants (color, size, materials, etc.)
As the number of components and variants grew, so did the number of possible combinations. Knowing all of the components – including rules for how they fit with one another – and managing combinations, including parts numbers and prices, became humanly impossible for sellers of such products. Software entered the picture.
CAD and the old sales and order process
Computer Aided Design (CAD) was introduced in the 1980s, originally for architectural/structural design purposes. CAD technology was parlayed into software products that handle floor planning, basic visualization and simple product counts. The software can handle large projects because it lacks detail.
- But CAD-based software has limitations: It is graphically inadequate – unable to simulate realistic environments in the drawing mode or produce photo-realistic renderings
- It is menu-driven – users must know which part numbers correspond to which components, or they must rely on specification guides
- Its product symbols lack intelligence – this, in turn, requires users to manually compile technical documentation, which increases error potential
- It is not a complete solution – it requires additional software to complete the sales process
The limitations of CAD-based software affect the entire sales chain, from the manufacturer to the dealer to the customer.
The steps from inquiry to installation are complex and numerous (Figure 1).
Figure 1. The typical sales and order process.
For companies that sell component-based products, quotation and calculation work is critical. Activities such as sales, manufacturing and assembly are dependent on close collaboration with those who perform the quotation and calculation work.
The above image shows the typical order process. A need is established by the customer or salesperson. Requests, verbal and written, are made to the quotation department, which is not usually in direct contact with the customer. Misunderstandings can occur and cause delays and incomplete proposals.
When the quotation becomes an order, a great deal of work must be repeated. The quotation department prepares material specifications and drawings for production and assembly. When preparing quotations, rough estimates may have been used but, at this point in the sales process, specifications now must be exact. Administrative lead time is often long. The result is often a delayed delivery time – leading to capital being tied up and orders possibly being lost.
PGC – the new sales and order process
There is only one known way to simplify the complex selling process:
Parametric Graphical Configuration (PGC)
Parametric Graphical Configuration (PGC) is a technology and a business strategy that makes selling configurable and parametric system products simpler and more efficient.
As a technology, PGC is object-oriented software, custom-written to include manufacturers’ products and product rules.
PGC works by reducing complexity. Here’s how:
Context configuration – the user removes the product groups or parts of groups that he/she doesn’t intend to work with, leaving the preferred product groups;
Parametric objects – the user selects those objects that he/she wants to use. A parametric object can describe many variations of a basic form;
Rules – built-in rules limit and control how different components fit together.
The decisive advantage of a PGC-based solution is the ability to parametrically and graphically represent products and components. This simplified, rules-based form of description means that each graphic symbol can represent thousands of product combinations. When configuring entire systems, the PGC solution manages the products’ mutual relationships and eliminates incompatible combinations.
Why PGC is a better solution
PGC is a technology, but it is rooted in a business philosophy:
- People should focus on aesthetic design plus other value-added activities: collaborating with clients, meeting with prospects, etc.
- Computers and software should manage technical data
PGC-based software automates the technical aspects of designing, specifying, rendering and ordering system products. The software automatically:
- Tracks components, attributes, quantities
- Validates configuration
- Compiles real-time pricing
- Renders with photo-realism
- Produces printed renderings and reports
- Generates bills of materials for ordering
- Generates installation instructions
- Additionally, the software can be integrated with an Enterprise Resource Planning (ERP) system and other programs.
Users don’t need to know, research or continually deal with technical information such as parts numbers, connectivity, pricing and report generation.
PGC-based software frees the user to:
- Focus on design
- Efficiently collaborate internally with others in the organization
- Efficiently collaborate externally with both manufacturers and customers
- Propose on more projects than previously possible
PGC reduces and simplifies the steps in the selling process, shortening the sales cycle:
Figure 2. The sales and order process with PGC.
Many work tasks disappear or are reduced through PGC. Drafting work is completed in a fraction of the time. Calculation is completed simultaneous to drafting. All tasks related to quotation and ordering are automatically handled.
How PGC works
In PGC-based software, components representing manufacturers’ products look and behave like the actual products. Users drag and drop selected components into a drawing layout. The components have been programmed with the manufacturers’ parts numbers, rules for valid configuration, prices, etc.
If one component is not meant to connect with another, the software won’t let the user make that mistake. But products that are meant to connect automatically snap into place. The software also automatically places and specifies required attributes such as columns, support beams, brackets, etc.
Users can add and change lighting, floors, finishes, textures, colors, architectural elements and accessories.
Consider the following example:
1. (Below) Dragging and dropping selected components such as wall panels, a desk and chair into a drawing, the user begins to create an environment. One workstation instantly can be replicated into multiple identical stations. Components that are meant to fit together automatically snap into place; required attributes automatically are added. The user can add/change colors, materials and other variants, as well as accessories, flooring and lighting, with a few clicks.
2. (Below) Glass panels can be inserted and will automatically snap into place:
3. (Below) Electrical wiring and outlets can be inserted and validated for connectivity:
4. (Below) Behind the scenes, all documentation, including a bill of materials and installation instructions, is created and updated automatically:
PGC’s time/cost advantage
Consider the case study of a leading North American office furniture dealership, which relied on CAD-based software and a custom ordering system. Analysis found that:
- 75 percent of work was technical – preparing quotations, setting prices and specifications for detailed products, etc.
- 15 percent of work was creative – aesthetic and functional design, floor planning, and selection of products and variants.
- 10 percent of work was miscellaneous – training, etc.
Figure 3. Breakdown of work tasks without the benefit of PGC.
A PGC-based solution reverses the percentages, enabling the user to focus on creative design while the software handles the technical work.
Analysis in this particular dealership showed that $150,000 USD annually could be saved if technical work was aided by a PGC-based software solution.
PGC reduces the learning curve
Selling and designing system products is complex work involving skill in sales, design and project management. Recruiting and retaining personnel is costly. A PGC-based solution is intuitive. Built-in product knowledge makes training and retention easier by helping employees to quickly learn products and design faster.
A newly employed salesperson and/or designer with some industry background can be fully engaged in designing and selling after one month of introduction. In some cases, training can be as little as one week or less.
PGC encourages adoption of new product lines
Most salespersons and designers tend to sell products that they’re familiar with. A PGC-based system’s extensive product support makes it easy to learn new products because they follow the same basic logic as previously implemented products.
PGC increases sales and profitability
Salespeople and designers using a PGC-based solution can more quickly produce high-quality proposals, shortening the sales cycle. Improved and error-free presentation and quotation materials yield increased customer satisfaction and fewer instances of costly fixes. The technology frees up valuable time, which, in turn can be used to develop new business leads, propose on additional projects, get product to market faster and, in turn, increase sales and profits.
Figure 4. Benefits of PGC on the bottom line.
Return on investment
Determining the return on investment of implementing PGC technology requires analysis of a company’s business processes as well as its cost/revenue profile.
Configura’s experience in developing front-end PGC solutions for more than 40 companies in diverse industries has found significant return on investment over CAD-based systems.
An organization should conduct due diligence in order to qualify a PGC-based solution:
- Perform a Needs Assessment
- Perform a Consequence Analysis
- Secure top management support
- Secure user participation/implement
1. Needs Assessment
A Needs Assessment is a process for determining and addressing needs, or “gaps” between current conditions and desired conditions [Gupta, Kavita; Sleezer, Catherine M.; Russ-Eft, Darlene F. (2007-01-16). A Practical Guide to Needs Assessment (2 ed.). Pfeiffer. p. 14-17].
According to Katz-Haas, a Needs Assessment is also about defining:
- Who users are
- Their tasks and goals
- Their experience levels
- What functions they want and need
- What information they want and need
- How they think the solution should work
- In a dealership, the needs may be identified as follows:
- Everyone who works in sales needs to be able to perform all of the different activities in the sales and order process.
- The organization needs to create a chain of unbroken electronic information from quotation to delivery and invoicing.
- All documents required during the order process need to be of the highest quality and delivered without delays.
- All deliverables need to be error-free.
- The organization needs enhanced capabilities to work with clients in order to achieve the best solutions possible.
2. Consequence Analysis
Before any change and subsequent implementation, a thorough Consequence Analysis must be made. A Consequence Analysis identifies the likely impacts of a PGC-based solution on an organization.
Analysis should include:
- What software options are there?
- How big is the investment?
- What are the hardware, training and implementation requirements?
- What internal resources are needed? Do these resources already exist?
- What effect on profitability would increased market share at X % have? Is it possible to obtain zero errors? How much would this save the organization in costs? How much would the organization gain/save by having an unbroken chain of electronic information?
- What other economic and human benefits can be obtained?
- Will the solution enable the organization to expand into new markets?
- What solutions have the top three competitors implemented?
- Would the organization lose market share to competitors if it didn’t invest in a PGC-based solution?
3. Secure top management support
The next step is to ensure that the PGC-based solution is supported by top management:
- Present the results of the Needs and Consequence analyses
- Demo the software using a qualified trainer/instructor
- Share case studies of successful implementations
As part of securing top management support, establish measurable objectives associated with use of the PGC-based solution. These benchmarks, set at both the organizational and individual user levels, will help to predict and evaluate success and set expectations for users.
Measurable objectives typically follow this formula:
- By (when), to do (what), saving X (percent/actual dollars) using the PGC-based solution instead of a CAD-based solution.
So, for example, these could be objectives at an organizational level for a dealership selling office furniture:
- By March 2010, to propose on at least 50 percent more projects using the PGC-based solution.
- By March 2010, to increase profits by $50,000 using the PGC-based solution.
- By March 2010, to cease using CAD-based software among 50 percent of employees.
These could be examples of objectives at an individual user level:
- By March 2010, to reduce the time it takes to propose on a 100-station project by 50 percent using the PGC-based software.
- By March 2010, to learn and begin designing/selling two new product lines using the PGC-based solution.
Discuss with management how adoption success can be increased by breaking implementation and expectations into smaller, realistic blocks of work. At each milestone, the old way of working should be jettisoned and the PGC-based solution fully adopted.
Discuss with management the importance of a risk/benefit reward program as incentive to adopt the PGC-based technology.
Management also needs to understand and support users’ needs for computer hardware capable of optimizing a PGC-based solution. Secure approval from management that users will have the necessary tools to achieve success with a PGC-based solution.
4. Secure user participation/implement
- Identifying “champions” in management and among employees is key to securing support. These select individuals should be “early adopters” by nature, open and willing to change. They should be good listeners – to effectively learn about the solution and to listen to the concerns and questions others may have about the solution. They also should be good communicators – capable of sharing with employees the rationale for a PGC-based solution and sharing with management the feedback from employees.
- In order to educate champions:
- Present the results of the Needs and Consequence analyses
- Demo the software using a qualified trainer/instructor
- Share case studies of successful implementations
- Share the overall goal and objectives
- Explain training and support opportunities
- Introduce a reward program
At milestones, evaluate success measured against the set objectives; additionally, assess user needs for additional support, hardware, etc.
As these early champions achieve success, encourage them to share their success stories and to help others. Begin training additional users.
Tips for early adoption and success:
- Launch with a known product line
- Launch in phases
- Know the audience – learn their needs
- Know key touch points – what resonates with users
- Counter fear of change through education
- Make hardware requirements clear
- Offer an ongoing mentor to new users
- Take advantage of training, user conferences and support provided by the PGC-based software provider
- Reward early adopters and ultimately all users for success
- Use your dealer intranet and other internal methods of communication to promote
- Continually evaluate
PGC is the basis for Configura Extension Technology (CET)
Based on PGC technology, CET stands for Configura Extension Technology and is the basis for CET Designer®, the core software product created by Configura. The CET foundation allows manufacturer-specific “Extensions” to be added onto the CET Designer® core. As the originator of PGC and a leading provider of software solutions, we help companies that want to achieve new levels of sales efficiency and order data integrity.
CET Designer® is a complete design, specification and visualization tool, allowing users to perform every step of the sales proposal process using one software program.
CET Designer® is most commonly used in the Commercial Furniture and Kitchen & Bath industries; it is also used in the Material Handling and Industrial Machinery industries.
Although CET Designer® is a stand-alone solution, the software is compatible with many industry-used programs, including AutoCAD and Revit®. CET Designer® also integrates with Enterprise Resource Planning (ERP) systems to ensure a seamless electronic transfer of data.
CET Designer® Extensions
CET Designer® is the platform on which different Extensions are added. All Extensions are published on the Internet and accessible from the Extension Manager in CET Designer® (in the “Extensions” menu).
There are two types of Extensions: Product Extensions and Utility Extensions.
A Product Extension is a complete logical, behavioral and business-process-oriented description of a particular manufacturer’s products. Unique manufacturer libraries contain both products from the particular manufacturer and specific functionality features. Besides parametric-based product descriptions, a Product Extension also includes information about configuration rules, business logic and the workflow process. Each Extension is ordered and maintained separately from CET Designer®.
A Utility Extension is a functional improvement or add-on to CET Designer®. It can include such features as a Customer Relationship Management (CRM) module, Enterprise Resource Planning (ERP) integration and extended CAD functionality. Utility Extensions do not include any manufacturer-specific products. As is the case with Product Extensions, all Utility Extensions contain security and licensing information.
Details are at www.configura.com/cet/extensions.
CET distribution technology
CET Designer® uses a centralized distribution technology. The software is downloadable via the Internet and resides on client servers or PCs.
The software also serves as a connection to a secure central repository, accessible anywhere in the world, where manufacturers can update their product data, price lists and related information.
Once CET Designer® is installed on a computer, each time a user logs on, the program actively searches for updates from the central repository and notifies the user. This technology ensures the seller always has the most current product data available.
Updates for CET Designer® are available in the Download Extensions section in CET Designer’s Extension Manager. All updates are included in the subscription fee.
Another built-in feature also lets users know when a new version of the software is available. New releases are also included in the subscription fee.
Licensing costs and discounts
CET Designer® and its Extensions are licensed on a subscription-basis. The subscription period is one year, with the option of a month-to-month subscription, and includes free upgrades and support. Discounting for multiple licenses is also available to manufacturers and end-users based on volume. Details are at www.configura.com/cet/download.
Training and support
Training through CET Designer® Academy is available in North America and Europe at Configura’s locations as well as on-site at manufacturers’ and users’ locations.
A two-day User Conference is held each fall in North America.
New features and hints are also regularly communicated via configura.com and within the CET Designer® Message Center. Additionally, on-demand pre-recorded Webinars are available at all times.
Free phone support for CET Designer® is available to users across the globe.
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