Why CPQ Is Better Linked To ERP

Than CRM
A Verenia White Paper

If you’re sitting in your office right now geeking out over which
CPQ solution is for you, there are several important questions to
ask about how all of your options integrate with your current tools.
Just a few short years ago CPQ (Configure Price Quote) tools were only available as standalone
solutions that were cost prohibitive for most SMB companies. With the recent proliferation of CPQ
solutions, they now don’t have to be isolated solutions. CPQ functionality now has the added capability to
work seamlessly with other systems such as CRM and ERP tools. It’s great for CPQ tools to integrate with
ERP systems because of vital connectivity points like inventory, costs, pricing, and customer data, but it’s
also good - and very convenient for salespeople - to have the CPQ tightly attached to the CRM.

Legacy systems are getting reevaluated at the operation and integration levels and as a result, thinking
about your CPQ in the same way is critical for your long term strategy. Last year over 93% of ERP users
reported that they had customized their system in some way.1 As you pour over your due diligence
checklist for CPQ, ask yourself whether your preferred solution should integrate with your CRM tool or
ERP. There are several advantages of the latter that should be factors in your deliberation.

Faster Connection Speed Between Servers

Every corporation feels a need for speed, especially in their automated solutions and enablement
software. Integrating your CPQ directly with your ERP system prevents the use of middleware that can
can slow server connections and make your system less reliable. A direct connection with the ERP
system prevents this versus a weaker connection through the CRM tool. When it comes to on-premise
ERP tools, look for solutions that have a reliable connector tool that retrieves and exchanges data.

Sidestep Information Silos

With all of the advancements in faster and faster productivity, sometimes this creates even more division
between departments. A silo is created when a team or a department works on a specific process without
awareness of how other departments are involved in the big picture before or after their involvement. Your
CPQ system needs to pull information from and integrate with an ERP system because information can
be seamlessly read, logged, and shared across many departments in an organization. This makes it a
winning solution to bring more clarity and alignment across teams within a company.

April 2017 Page 1 www.Verenia.com

 Why CPQ is Better Linked to ERP than CRM – A Verenia White Paper

Fewer Security Threats

When your CPQ tool is integrated with ERP it becomes easier to include all of the data in regular data
backups, therefore making it tougher to lose or misplace critical information. It also helps prevent your
staff from making any unauthorized updates to your software because it can be under the controls of one
cohesive system with the same protocol in place to manage changes. Data that’s critical to your company
and making your CPQ work should rightly belong in your ERP (not duplicated in your CRM or CPQ) and
where this is the case you can indeed benefit from security and backups of this critical data. Additionally,
you’re less vulnerable to attacks resulting from delayed updates to software components and middleware
components that tie everything together. In a nutshell, you’ll have a safer less convoluted system.

Quicker Personalization by Market Segment

When you have a CPQ tool that’s directly integrated with the accounting, finance, and inventory systems
of an ERP system, your quotes will be more accurate and capable of adapting to customer personas and
their needs. This enables precision pricing and excellent opportunities for upselling and cross selling. Your
pricing strategy can be much more easily determined by your market verticals, and when customers get
what they want faster, profits soar.

Scalability
Think about the long term needs of your company-wide collection of solutions as well. Having a solid
foundation of an ERP with direct integrations lends the security needed to build analytics. It also means
you won’t have to pause the growth of your business due to limitations in your software capability.
Thinking about scalability with regard to your CPQ integration plays a valuable part in helping to future
proof your entire system. Midsized companies with up to date ERP systems grow operating margins by
21%.2

It’s easy to be in a quandary about which of the many available CQP solutions you should get as there
are now so many. With growing options comes innovation, yet it requires more careful evaluation on your
part to make sure you get the right one for your needs. You may have overlooked the question of whether
to link your CPQ to ERP or CRM, but if so, you now know to add another line item to your criteria. Direct
integration with ERP will yield many benefits.So if you’re still in your office hyper-analyzing the scoring
system for your software evaluations, send us a picture of your cubicle! We want to salute you!

April 2017 Page 2 www.Verenia.com

 Why CPQ is Better Linked to ERP than CRM – A Verenia White Paper

Sources
1. http://panorama-consulting.com/key-findings-from-the-2015-erp-report/
2. http://blog.e2benterprise.com/6-compelling-erp-statistics-why-midsized-companies-must-upgrade-
their-erp-system/

Additional Reading
How Microsoft, Oracle and SAP lost the CRM market
https://www.linkedin.com/pulse/how-microsoft-oracle-sap-lost-crm-market-jiri-kram

Silos, Politics, and Turf Wars Patrick Lencioni 2006, Jossey-Bass, San Francisco, CA

Jack Welch’s Approach to Breaking Down Silos Still Works

https://hbr.org/2015/09/jack-welchs-approach-to-breaking-down-silos-still-works

If you have questions or would like more information about CPQ and what it can do for you,
please contact Verenia at 800-738-7760.

April 2017 Page 3 www.Verenia.com