UPS manufacturer American Power Conversion uses a rules-based product configurator to speed response to customers' requirements.
As one of the top makers of power protection systems, $1.7 billion American Power Conversion Corp. (West Kingston, RI) goes by the motto, "Always on, always available." So, when APC senior management planned the launch of its On Demand Data Center product line back in 2000, they knew the ability to quickly generate accurate quotes and configure products was crucial.
Founded in 1981, APC for years made stock cooling components for uninterruptible power supply (UPS) systems. But by the end of the 1990s, the market began to shift away from a supply-driven model, in which companies made products and offered them for sale, to a customer demand-driven model in which customers set the tone with their individual preferences.
Designed to cater to those preferences, APC's InfraStruXure line consists of data center infrastructure, highly configurable power distribution systems, software management systems, fire protection equipment, security systems and services -- everything you might need to outfit anything from a modest wiring closet to a 50,000-square-foot state-of-the-art data center. In putting together a layout for a mid-size data center with about 250 racks, for example, a highly skilled engineer would have about 2,000 different configuration variations to choose from.
"Using manual methods, it would take at least two or three hours to put together the ballpark quote. And then there's no guarantee you would actually get that business," says Soren Brogaard Jensen, director of software engineering for APC.
To avoid the need to hire more highly skilled engineers to support the new solution, APC in 2000 implemented a quotation management/ configure-to-order knowledgebase system from CINCOM Systems Inc. (Cincinnati, OH). The system, called Socrates, aimed to smooth the ordering process for the InfraStruXure line, which averages $150,000 for a configured solution. The system has paid off, allowing APC to cut quote turnaround times, keep staffing levels under control and even increase average selling prices on InfraStruXure line implementations.
From the simplest consumer packaged good to the most complex jet aircraft, the trend is toward customers calling the shots. Customers not only want it their way, they want it yesterday. To cope with rising customer expectations, manufacturers of complex products like APC are turning to robust product configurators that not only speed the time to quote but also handle highly detailed product configuration with ease. In some cases, the product configuration engine is fully integrated with the company's ERP system, creating an integrated process that reaches from the customer demand signal to manufacturing and order fulfillment.
"The configure-to-order software space is very small right now, but it's growing," says Marc Halpern, research director of product lifecycle management for Gartner Inc. "They're going to be increasingly important because markets want customized goods. We've gone from supply-driven markets to demand-driven markets."
Better Quotes, Faster
Since APC had always built to stock, company leaders were rightfully concerned that the launch of highly customizable integrated solutions would require a sea change in the company's request-for-proposal and manufacturing processes.
The first step in any customer inquiry is to put together a high-level rundown of the product's benefits and a rough estimate of its cost. And yet even without covering for every future contingency, the initial estimate can still take a few hours and several calls to get the engineer with the right product knowledge on the phone. Managers worried that with the new product line the human element involved in the quoting process would be swamped right off the bat.