As soon as you have decided to work with CPQ, an important choice awaits you: will you choose cloud CPQ? Or traditional CPQ, installed locally? This choice is one of great importance, as it has a large influence on factors such as implementation length, how fast the software is able to work, the costs, and scalability. In this item you will read why we vouch for cloud CPQ, and what its benefits are.
Before we inspect the advantages of cloud CPQ, we go back to two important terms: cloud versus local.
When you choose the traditional way, you will be installing your CPQ locally. Meaning that you reserve a server, or part of your server room for the software. In that case, you are responsible for maintaining and managing the software. Initial costs are relatively high, but you will have full ownership.
Should you choose CPQ in the cloud, then a big portion of the workload is outsourced. No need to manage or buy a server, and maintenance of said server does not become your responsibility. For a predetermined monthly price you are able to use the CPQ software. No high initial costs and no worries about the server operating like it should. However, this also means you do not get full ownership. While that may seem like a disadvantage, you will find out later in this blog that this does not really matter all that much.
Cloud CPQ creates a number of hefty advantages in comparison to a traditional solution. We will summarize a number of these benefits for you.
When using a cloud based solution, you will always be working with the most recent version of the software. Developers are constantly improving their software, and are able to very quickly and simply share this with you in the cloud. In other words, you are always able to utilize the newest functionalities, and will always be up to date privacy- and security wise as well.
Compare this to locally installed CPQ solutions: once or twice per year you will receive a massive update, which changes a lot of things very suddenly. As a user, you will lose your clear overview, and you will probably not ask yourself whether something has broken, but what. When your traditional CPQ is integrated with other software you can count on something breaking after an update.
Let us look at an example. Imagine your local CPQ system notifies you that at the end of Q4 an update will roll out, and that you might have to adjust a number of integrations. Multiple modifications have to be made, but your supplier does not know all ins and outs, so they will also be grasping at straws. The end of Q4 nears, and you assume everything is updated and future-proof. Until you are suddenly unable to take orders in your ERP system during the busiest period of the year. Your IT-supplier has a limited workforce, you are unable to reasonably end the year, and it costs more time and money to keep everything functional. And we are not even mentioning the extra work afterwards, along with all its frustrations.
Another big benefit of cloud CPQ is its scalability. Or even hyper-scalability, if you will. The necessary calculating power can be scaled up, directly and endlessly. For instance, you are configuring extremely complex machines, containing a whopping 35.000 different calculations to get to the correct assembly. Is your CPQ software installed locally? Then your calculation time is dependent on the amount of space you originally reserved in your server. Is there insufficient room available? Then you could choose to purchase an expensive extra server, wait for delivery and installation.. And then potentially find out you no longer need the extra calculating power.
Cloud CPQ can easily communicate with other applications through APIs. These are comparable to a power strip, able to work with numerous applications, so that they can easily send- and receive data between one another. For instance, you could include an external calculation tool in your own CPQ to support a part of your process. With a traditional solution this becomes much more complicated, as it works from its own isolated database. From here, it becomes more difficult for it to reach out to external applications or integrations. And now that we are collectively moving towards best-of-breed solutions, this becomes somewhat unacceptable.
To be honest, we could go on and on summarizing the benefits of Cloud CPQ. You could build your own integrations and workflows on so-called low-code platforms, to support your specific process. And CPQ in the cloud can be used anywhere in the world and on all sorts of devices, as long as you have access to a browser and internet connection. Additionally, Cloud CPQ often has a much better user interface, as a result of the scaling advantages that frameworks offer you. And, and, and…
And maybe the best thing to do would be to just request a demo so that you can see Elfsquad CPQ in action with your own eyes. In the cloud, of course.
Elfsquad removes all worries from your pre-production process. With Elfsquad as backbone, we realize the digital factory that smart industries have been trying to find for so long. We do this through a product configurator, with integrated solutions for marketing, sales, and operations.