ABOUT THE REPORT

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ABOUT THE REPORT

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.

/01


THE CURRENT STATE

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.

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

Blast from the Past: The 2

Previous Tech Revolutions

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.

“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)

“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-aservice

(SaaS).”

Software: Universal Service?

(Economist, 2006)

/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.

“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

Quote-to-Cash strategies and solutions will make customers

the focus of your revenue strategy.

/05


QUANTIFYING QUOTE-TO-CASH

Companies that have automated their Quote-to-Cash process have seen:

105%

Larger Deal Size

60%

Improvement in

Contract Cycle Time

28% Shorter Sales Cycles 26%

More Reps

Achieving Quota

49%

Higher Proposal

Volume

17%

Higher Lead to

Conversion Rate

/06


PRESSURES FORMING THE

QUOTE-TO-CASH DIAMOND

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 been only grown more demanding. In fact, currently there is a new generation

of employees are gradually entering the workforce, who have never had to wait because they

grew up with iPhones, YouTube and social media.

/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 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,

cup 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.

Shaq

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 give provide the edge, not size. Big

companies can’t box out smaller ones any longer.

Steph Curry

/09


MAKING THE DIGITAL LEAP:

WHY IT’S TIME FOR A CHANGE

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


›› 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.

Copyright © 2016 All rights Reserved

/11


›› 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

Copyright © 2016 All rights Reserved

/11


›› 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.

Copyright © 2016 All rights Reserved

®

/13


“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 measuring 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


2016 QUOTE-TO-CASH

COMPANIES OF THE YEAR

The following three companies were willing to make the

leap into the digital and adopt Quote-to-Cash. Here is a

look at their stories, their leaders, and their success.

/16


2016 QUOTE-TO-CASH

COMPANIES OF THE YEAR

"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

Copyright © 2016 All rights Reserved

®

/17


2016 QUOTE-TO-CASH

COMPANIES OF THE YEAR

“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

Copyright © 2016 All rights Reserved

®

/18


2016 QUOTE-TO-CASH

COMPANIES OF THE YEAR

““[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

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


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 userinterface

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.

/21

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