Flexible platform for the sales of the future

Many systems are getting on in years and can only be further developed to meet new conditions at great expense. MedTech manufacturer Raumedic has therefore decided to replace its old SAP CRM system with SAP Sales Cloud and SAP CPQ. This is also because the end of maintenance for SAP's Business Suite 7 is approaching.

It is nothing new that companies have to consider which solutions should replace SAP's Business Suite. This also applies to CRM 7.0. It stands to reason that many existing SAP customers are planning a transition to C/4 Hana Customer Experience (CX). Raumedic, an international medical technology manufacturer headquartered in Helmbrechts, Bavaria, made a conscious decision to use the SAP Sales Cloud component within the C/4 platform. Also because the development effort would have been too high to adapt the old CRM 7.0 to the changed requirements. Together with the management and IT consultancy MHP, the Sales Cloud and CPQ (Configure Price Quote) were introduced last year. And completely remotely.

For more than 70 years, Raumedic has been developing, manufacturing and distributing tubes, molded parts, complex systems and medical products for various diagnostic and therapeutic applications. These are often complex, customer-specific ideas that Raumedic translates into economical product and manufacturing concepts and also produces on request in its own production facilities.

Raumedic is growing and has big goals: to consolidate its positioning in the European and Asian markets and to drive forward the development of its business in North America, the world's largest medical technology and pharmaceutical market. These goals are to be achieved with a global sales network and the company's own sales companies in the core markets of Europe, Asia and the USA, which can guarantee high product availability at all times for customers in the medical and pharmaceutical sectors and end users in hospitals and medical practices. This requires a rapid response to customer inquiries as well as a fixed quotation and implementation of individual product requests.

Out: SAP CRM 7.0

The existing on-prem system SAP CRM 7.0, which had been introduced in 2011, could no longer meet the changed requirements. This refers in particular to faster processing and evaluation of customer ideas (projects) as well as precise and timely creation of quotations. This was not possible, or only possible with great difficulty, with the existing system and the various tools such as Access and Excel.

Raumedic's sales department had primarily worked with the CRM system, maintaining and processing customers and leads here. The product management team used Excel spreadsheets and created their projects in them. Customers from the medical sector approached Raumedic's sales department with an inquiry for the manufacture of a customized product. Raumedic's sales department stored such customer inquiries in the CRM system.

Together with product management, it was examined whether the product idea was an interesting opportunity or not. The main focus here was on economic feasibility and weighing up whether the idea could actually become a product, for example the manufacture of a customized silicone hose. If the product idea was feasible, the existing customer lead became an opportunity. For this purpose, the product management team created a project in Excel to store relevant data such as dimensions, material, margins, etc. The project was then completed.

A quotation was finally created in a Word document. To do this, customer data had to be transferred from the ERP system, product data had to be copied in from Excel, and drawings had to be added from another program. The process, from inquiry to quotation to actual order (lead-to-order), was time-consuming and often incorrect due to the numerous system breaks.

Another problem: the numerous Excel lists, which were stored decentrally in different versions. As a result, important opportunities could not be prioritized quickly enough. Therefore, a change was required: quotation processes were to be optimized and accelerated. It was to be possible to adapt quotation forms individually, but quickly and without major technical know-how. It was also necessary to reorganize the entire opportunity management process for the project business. All Excel tables in which opportunities in the project business were evaluated were to become a thing of the past.

Christian Vogler, IT Consultant SAP Applications at Raumedic: "We had the desire to streamline our sales processes. Two levers were to contribute to this: Firstly, faster processing of potential product ideas. On the other hand, the more precise and faster creation of offers. This would not have been possible with the old CRM system or only with a high development effort. That's why we made a conscious decision in favor of SAP Sales Cloud as the new CRM solution, also due to the end of maintenance for SAP CRM 7.0 and the complete switch to S/4 Hana."

Sales Cloud as SaaS

SAP Sales Cloud is provided as Software as a Service (SaaS) in the cloud and can therefore also be accessed without a VPN connection. In addition, the SAP Sales Cloud can be flexibly integrated into the S/4 system. Following a tender process, Raumedic chose the management and IT consultancy MHP to implement the SAP Sales Cloud in June 2020.

Vogler: "We were convinced by the open and honest nature of the project team and the project implementation. A mixture of agile approach and the traditional waterfall model."

SAP Configure Price Quote (CPQ) simplifies the process within the quote creation. CPQ is a powerful cloud-based configuration tool and a component of SAP Sales Cloud and SAP Customer Experience Suite.

Stephan Jung, Senior Manager at MHP and responsible for the implementation project: "We had considered SAP CPQ as a complementary solution option. We saw that Raumedic had to create a lot of customized quotations. The sales department had spent a lot of time on this until the final quotation finally reached the customer. In particular, CPQ was intended to help Raumedic create customized quotations for the manufacture of complex medical technology products faster and more accurately for Raumedic's various markets."

One of the most important specifications was that the Sales Cloud should be introduced in SAP standard, also to ensure maximum release capability in the long term.

Based on the defined requirements for the SAP Sales Cloud and CPQ, the solutions were successively built and technically tested. Finally, the configuration of the Sales Cloud and CPQ in the quality environment and the integration with the ERP world could be carried out.

The integration of CPQ, of which only the quotation system (Quote) was to be implemented, proved to be a technical challenge: Although SAP offers a preconfigured integration in the Sales Cloud, this only provides basic functions that can be supplemented individually according to the customer's requirements. This is because CPQ was only recently acquired by SAP and the tool is not yet fully integrated into the C/4 and ERP suite.

In Raumedic's case, for example, details were missing in the data exchange between SAP ERP and CPQ. The SAP Expert Service Team was brought on board to ensure that expert knowledge was quickly available and the project could be implemented quickly and consistently. In this way, solution concepts for Raumedic's requirements could be created in close cooperation.

A key point was the necessary enhancements in SAP ERP for the provision of the customer and product data that was later required in the CPQ component in the quotation template. There were no standard integration scenarios from SAP for this. Individual implementations also had to be made for the provision and subsequent update in CPQ. In addition, the integration platform was extended accordingly.

"We quickly and consistently developed the appropriate construct for Raumedic in SAP CPQ. This involved implementations in SAP ERP and in SAP CPQ respectively, which enable the exchange of customer and product data. As a result, the CPQ system is seamlessly connected to the CRM and ERP environment and is crucial for accelerating the entire lead-to-order process. All sales processes are now simplified and connected end-to-end", explains Jung.

Opportunities and CPQ

The process now looks as follows: An inquiry is created in SAP Sales Cloud for an individual product offer, for example thermoplastic and silicone injection molding components. The opportunity is checked and evaluated in SAP Sales Cloud. Employees in sales and product management (project managers) see a consistent picture of the various opportunities and can see at a glance which of the opportunities should be prioritized. If an opportunity is promising, the offer can be prepared in CPQ within the integration platform. For this purpose, customer and product data are automatically pulled from the ERP system and transferred to the quotation template. The document is now generated and can still be customized, for example by color underlining in the document.

Once the quote is ready, an approval process starts automatically. If the quote fits, the sales team issues an approval. The current status of the quotation can be seen in SAP CPQ. If the customer is satisfied, a purchase order with the necessary information can be sent to SAP ERP from the quotation in SAP Sales Cloud. In this way, production orders can be created in ERP and forwarded to production.

With the introduction of SAP Sales Cloud and the CPQ application, the sales process, especially the lead-to-order process, is many times faster, as opportunities and quotes can now be processed in one system. It is no longer necessary to switch applications. Opportunities can be evaluated and prioritized more quickly in the cloud.

In the future, deal intelligence can also be activated on this basis. This function can support sales in evaluating and prioritizing opportunities accordingly on the basis of machine learning (intelligent scoring
of opportunities). This allows sales to focus in particular on promising opportunities.

CPQ templates

The new CRM solution also helps to significantly simplify the quotation process. Sales can create customer-specific quotations more quickly thanks to the CPQ templates, which can be flexibly adapted. Margins can be displayed transparently so that unprofitable discounts can be avoided. Change requests can be taken into account in the system in real time, even at a later date. In short: Raumedic can provide complex offers faster and in higher quality, which ultimately also leads to a better customer experience.

Christian Vogler: "We are very satisfied with the adjustments made by MHP. We now benefit from simplified but holistic sales processes. The unified, cloud-based and scalable sales platform helps us to react faster to market dynamics in the medical device industry."

A uniform and simplified quotation process ensures that complex and individual quotations can be created more precisely and faster. The time and effort required to process quotations has been reduced by 50 percent. Opportunities can now be evaluated and processed in a single system, and in future they can also be prioritized according to a scoring system.

There is a "single point of truth" for sales-relevant product and price information as well as for the customer-specific sales history. All information is available in one place, which facilitates documentation - also against the background of clean and FDA- and TÜV-compliant record keeping. The sales department has more time for day-to-day business because the necessary information is available in one place, which also has a positive effect on the quality of direct customer contact.