Closing The Product Configuration Gaps In Your Selling Strategies

Bottom Line

Capture more revenue from your selling strategies by finding and fixing the product configuration gaps between sales, engineering, and production using five key metrics to see what’s working and what needs to improve.

  • One in five customers is willing to pay up to a 20% premium for a product customized to their preferences and unique requirements according to Deloitte.
  • 22% of customers are willing to share additional personal data to assist manufacturers in creating products tailored to their specific preferences.
  • 48% are willing to wait long for a personalized product or service that reflects their unique preferences.
  • Closing the product configuration gaps that exist between sales, engineering, and production is one of the fastest ways to increase sales by exceeding customers’ expectations of value and customization.

Closing the product knowledge gaps between sales, engineering and product close more sales deals too. Getting all three departments to rely on a single database or system of record that provides a lifecycle-based view of product configuration leads to more accurate quotes, faster sales cycles, and higher perfect order performance.

Customers are willing to pay up to a 20% premium, provide personal data and wait longer (48%) for a product customized to their specific preferences and requirements making product configuration strategies a proven strategy for increasing sales.

Mind The Gap

Manufacturers often don’t realize how wide the product configuration gaps are between their selling, engineering and production teams. One of the best ways to find out is to look at the baseline performance of four of the many metrics and Key Performance Indicators (KPIs) that reflect how well a product configuration strategy is working:

  1. Gross Contribution Margins by Product, Production Facility and Business Unit – When sales, engineering and production teams are all working from the same lifecycle- based product configuration system of record, there’s less margin leakage throughout the production process. In fact, manufacturers who rely on Configuration Lifecycle Management (CLM) report gross margins increased by 40% or more for configured products. Creating a framework that drives collaboration based on a scalable, accurate system of record drives growth.
  2. New Product Development and Introduction (NPDI) Revenue Capture Rate – Quantifies how successful each new product introduction is
  3. Perfect Order Performance – Measures how effectively a manufacturer can capture order with no errors, allocate inventory and deliver the product on time, meeting and exceeding customer requirements. Perfect Order Performance is an especially useful metric for tracking product configuration performance as complexity starts with the first quote and exponentially increases from there. Many companies refer to this metrics as the Perfect Order Index (POI) as they create time series analyses from the data. Further information regarding Perfect Order performance can be found here.
  4. Quote Cycle Time – Measures how long it takes to create a quote for a configurable product and return it to the prospect, complete, ready for their review and approval. Quote Cycle Time is an excellent metric for evaluating how well product configuration information and knowledge is being shared and used through a manufacturing center. This metric is also commonly used to track the accuracy and efficiency of real-time integration between CRM, ERP and PLM systems. When a product configuration-based system of record is shared across all enterprise systems, quote cycle times are reduced, quote accuracy increases, and perfect order performance increases over time.
  5. Quote Conversion Rate – The purpose of this metric is to track the percentage of quotes that lead to sales. Quote Conversion Rate is invaluable for measuring how effective the integrated base of CRM, ERP and PLM systems are at using the configuration-based system of record to produce and deliver accurate quotes. Ideally, all three enterprise systems need to have real-time integration links to the system of record to ensure the highest levels of order accuracy can be accomplished on an ongoing basis.

Closing Product Configuration Gaps Grows Digital Manufacturing Businesses

When every sales, service and support channel is relying on the same product configuration system of record, customers get what they want most: consistent, fast, smart responses to their questions. Closing product configuration gaps are one of the most valuable strategies there is for strengthening Configure, Price, Quote (CPQ), Quote-to- Cash (QTC), Configure-to- Order (CTO) and Engineer-to- Order (ETO) selling strategies.

Improving the many product configuration-based selling strategies is just the beginning. Over time, manufacturers including Jaguar and others able to increase the scale, scope, and speed of innovation as well. Improving selling accuracy and speed while increasing innovation is two catalysts driving the exponential growth of digital manufacturing. According to industry research firm Statista, digital manufacturing is predicted to be worth $1.4T by 2030, with product configuration contributing $300B in global revenues. Product launches, another area CLM contributes heavily to, is predicted to be a $120B market by 2030.

Projected Size of The Global Market For Digital Manufacturing in 2030, by Industry Segment


Deloitte (2015) The Deloitte Consumer Review, Made-To-Order, The Rise Of Mass Personalization(PDF, 24 pp).

McKinsey & Company (2013). How Technology Can Drive The Next Wave Of Mass Customization. Gandhi, A., Magar, C., & Roberts, R. (2014) (PDF, 8 pp.)