Quote-to-order: A Newcomer Causes a Stir in the Market

The first part of this series provided a detailed background of the still-evolving quote-to-order (Q2O) space, including historical examples to show why the market is increasingly demand driven. Part one summed up by making general observations as to how Q2O software solution vendors have addressed the market, and about the additional features and functionalities they will need to incorporate as demand shifts.

Now it's time to take a look at one of those high-flying "newcomer" providers: enter BigMachines, Inc. (www.bigmachines.com), a rapidly growing company founded in 1999, and with North American headquarters (HQ) in Chicago, Illinois (US), and European HQ in Frankfurt, Germany. The vendor also offers global customer support and hosting operations with a technology center in San Mateo, California (US), a West Coast data center in San Francisco, California (US), an East Coast data center in Sterling, Virginia (US), and an Asian research and development (R&D) center in Hyderabad, India.

According to the BigMachines Web site and associated press releases, the vendor is a provider of on-demand configurator, quoting, and proposal software and associated professional services. Its clients are in the high tech, industrial equipment, medical instruments, and software and services industries. The company's solutions help its clients' sales teams and channels to streamline their selling processes from customer inquiry-to-order. The BigMachines solution digitizes complex selling processes and captures an organization's tribal knowledge. By doing so, it provides online product selection, configurator, quoting, and ordering capabilities for new products and aftermarket parts, and streamlines configuration, pricing, quoting, proposal generation, and order management. BigMachines' rapidly growing customer base of over 100 corporations includes global leaders such as Kodak GCG, Siemens, Ingersoll Rand, and NTT Communications, as well as innovative growth companies such as ShoreTel and Aruba Networks.

Getting Cozy with Customer Relationship Management (CRM) Powers

BigMachines' Lean Front-end (LFE) solution provides reporting capabilities that help analyze sales activities, and integrates to existing enterprise resource planning (ERP), computer-aided drawing (CAD), and CRM systems, including those from Salesforce.com, Oracle CRM OnDemand, Oracle, and SAP.

For Salesforce.com and Oracle CRM OnDemand customers, BigMachines offers two different product editions: SPP (standing for selection, pricing, proposal) and CPP (standing for configuration, pricing, proposal). The SPP is an entry-level solution that does not include the configurator module. Both solutions enable users to streamline their entire Q2O processes, all within the familiar Salesforce.com CRM interface.

The CPP and SPP product pricing capability includes BigMachines' certified and packaged integration to these two CRM products above. The vendor also offers Professional and Enterprise editions which have different price points, minimum numbers of users, bundles of other BigMachines modules, and other add-on original equipment manufacturer (OEM) software. All of these product editions are part of the umbrella BigMachines solution.

For instance, as noted in a BNET article from 2006, BigMachines'

SPP solution extends Salesforce.com's functionality to enable users to generate rich and accurate proposals. SPP users can quickly select the right products to quote to the customer by searching for products using multiple search criteria, including descriptions, part or stock-keeping unit (SKU) numbers, product families, price lists, and other custom fields. Users can add the selected product(s) to a quote with one click, and the quote is automatically populated with address and customer data from the related Salesforce Accounts and Contacts tabs. Quote and revision numbers are also generated automatically and all changes are tracked.

The article goes on to say that

[r]ich proposal packages can be generated in Adobe (.pdf) or Microsoft Word (.rtf) formats, and include cover letters, product descriptions for each line item, pictures, graphs, drawings, marketing collateral, and terms and conditions. All relevant proposal data is automatically populated back to the Salesforce Opportunity… [ensuring] up-to-date pipeline data and [eliminating] manual data re-entry. Quotes can be converted to orders with one click and submitted electronically to the business system via BigMachines Integration.

According to Big Machines, more than half of its customers are "the result of a 2005 certification agreement forged between the two companies," and SPP and CPP have since been available through the Salesforce.com AppExchange marketplace of on-demand applications.

Mid-2007, BigMachines announced the general availability of BigMachines CPP for Salesforce PRM (standing for partner relationship management), a best-of-breed application designed to help companies manage quotes and generate accurate forecasts across multiple sales channels. BigMachines' CPP application is now fully integrated with Salesforce.com's on-demand PRM solution. BigMachines CPP for PRM extends Salesforce PRM by empowering channel partners to more quickly and accurately configure solutions, generate their own quotations, and sell products more easily and quickly, while capturing channel quoting activity with direct integration to the Opportunities, Reports, and Forecasts tabs in Salesforce.com.

BigMachines CPP for PRM also integrates a slew of new features to improve the sales process for channel partners.

In 2006, BigMachines announced in a press release that the integration between its on-demand LFE solution and Oracle's Siebel CRM On Demand was "successfully validated" by Oracle. At the same time, BigMachines also became a Certified Partner in the Oracle PartnerNetwork (OPN). As mentioned above, BigMachines' offerings help enable sales teams "to configure complex products, manage complex pricing and up-sell options, create quotes and proposals, and send error-free orders to ERP systems or order entry personnel." As for Oracle, "its multi-channel offerings allow organizations to manage and coordinate all customer interactions across the Web, contact center, field sales/service force, branch/retail network, and indirect and partner distribution channels."

The same press release adds that

[t]he integration of BigMachines with Siebel [Oracle] CRM On Demand allows users to populate quotes and orders directly with Siebel [Oracle] CRM customer contact data, and then link detailed quote and order information directly to CRM opportunities. This helps reduce manual data entry across multiple systems, and provides an integrated view of sales wins and losses across customers, accounts, and opportunities.
[BigMachines' solution] can be configured to customer needs using on-demand or on-premise platforms, and can integrate with Siebel [Oracle]CRM On Demand or on-premise as needed.

Feeling Good Big Time

Godard Abel, BigMachines' co-founder and CEO, states in an interview published March 17, 2008 that he "started BigMachines in 1999 to help industrial equipment companies leverage the latest Web technology to sell complex products." He continues:

My family had been running an industrial pump business for 50 years and saw many of the challenges of selling these complex pumps. I left my position with a Silicon Valley software company to capture a huge opportunity to sell Web technology to companies like my father's. The goal was and continues to be to build an enduring company that combines Web technology with deep industry and process improvement expertise.

Recently, BigMachines announced it achieved a record in 2007 with a 96 percent growth in revenues and a 66 percent jump in customers over 2006. In addition, the company launched several major product releases, adding new capabilities to its best-of-breed solution suite. This came at the heels of formerly record-year 2006 with a 59 percent growth in contract bookings and a 79 percent jump in customers over 2005. Customers added in 2006 included divisions of global leaders NTT, Emerson, Thermo Fisher Scientific, Teradyne, and Kubota Tractor.

This growth trend continued in Q2 2008, as the company recently announced. So far in 2008, BigMachines has already won 18 new customers across a number of industries, including high technology, software, industrial equipment, and telecommunications. In Q2 the company achieved a record number of new contract bookings, which were up 84 percent year-over-year, as well as a 94 percent increase in recurring revenues compared to the same quarter in 2007. In addition, BigMachines achieved several significant milestones during Q2, including release of version 8.2 of its flagship software product; launch of its industry-leading customer support program, including its My BigIdea online innovation community; and successful completion of the Statement on Auditing Standards 70 (SAS 70) Type II audit, which assesses the operational effectiveness of internal controls within service organizations.

BigMachines has successfully deployed its solutions to customers that serve a broad variety of markets (listed previously), surpassing the 100 customers milestone. Some of the approximately 40 customers added in 2007 include divisions of global leaders United Technologies and Kodak, in addition to fast-growing software and technology companies such as Merge Healthcare, Enterasys, Bottomline Technologies, and NaviSite. The profitable, privately held vendor is also reinvesting for growth, as it approaches 50,000 licensed users across customers and their channel partners.

In 2008, BigMachines' staff grew to over 100 resources globally, while the vendor continued to expand its product development capacity with additional offshore development resources. It also added (about doubled) significant customer service resources, telecommunications infrastructure, and helpdesk systems across multiple office locations to support its growing global customer base. In addition, BigMachines expanded its partnerships with other technology and service providers to include ATG, Xactly Corporation, and Right90.

Recently, the company acquired its first joint customers through Right90 and Xactly. For Right90, data coming from BigMachines quotes and orders is integrated to Right90's forecasting solution at both the quote and product-line item level. With Xactly, the same BigMachines quote and order data is used to run compensation scenarios for sales incentive planning and reporting. It is still too early to share too many details about the ATG partnership, other than to say that the joint interest is in offering BigMachines configurator integrated with ATG's leading B2C and retail e-commerce capabilities.

Of note is that BigMachines has more joint customers with SAP than with any other ERP vendor. While its product is not SAP NetWeaver–certified (see Multipurpose SAP NetWeaver), the vendor uses other middleware to integrate where necessary and has seen no technical barriers to this point. In fact, customers have simply not demanded the certification, even those who use multiple SAP products. BigMachines thus claims to have not seen enough customer demand to warrant the certification investment—at least not yet.

Global Professional Services Capability

BigMachines' most recent partnership is with Bluewolf, a global on-demand consulting firm. In a press release from March 10, 2008, the companies

announced a strategic alliance to provide [software as a service] SaaS configuration and quoting solutions and services for high tech, industrial, and medical companies. Under the terms of the strategic alliance, Bluewolf and BigMachines have agreed to participate in joint marketing and consulting to better automate the quote-to-cash process. Bluewolf will train and deploy a team of BigMachines experts to rapidly deploy [BigMachines' solution] and to ensure that customers are successfully automating their quote-to-cash processes.

The same press release states that "[i]n addition, Bluewolf will expand its trademarked Customer Success Guarantee deployment methodology to include the specific deliverables associated with a successful BigMachines deployment, including seamless integration to CRM applications such as Salesforce.com." The press release notes this about Bluewolf:

Founded in 2000, through its Customer Success Guarantee, Bluewolf is trying to reinvent the concept of enterprise consulting, one that is tailor made for the on-demand world. Bluewolf's practices incorporate three main areas: on-demand consulting, on-demand IT resourcing, and on-demand remote services.

The partnership marks the fact that the SaaS market has moved beyond just CRM, and is now offering solutions for verticals such as manufacturing to enable them to realize the benefits of SaaS. The press release also adds that "[t]he alliance will cover business in North America and Europe, Europe, Middle East, and Africa (EMEA), where both Bluewolf and BigMachines have local presences."

Along similar lines has been BigMachines' relationship with eLogic Group (www.elogicgroup.com), which, according to another press release of March 19, 2008,

provides full-service business solutions for engineered equipment manufacturers to simplify and automate core business processes… eLogic brings specialized expertise in sales channel, product, information technology (IT), and change management needed to tackle the most complex engineered product environments.

As Tom Erdle, principle and cofounder of eLogic Group states, the "growing installed base of reference eLogic and BigMachines joint customers includes leaders such as SPX Corporation, Conair Group, Particle Measuring Systems, and Thermo Fisher Scientific." The addition of eLogic adds SAP implementation experience for customers with SAP integration requirements.

BigMachines has a number of services partners to increase reach that are appropriate for different types of projects and that have also validated the quality of the solution. But in order to dispel any competitors' claim that these partnerships are due to the product's complexity, BigMachines cites several delighted customers that have implemented the solution on their own with very little spent on professional services. Video testimonials on its Web site from customers NTT Americas and SpectraLogic might validate this point. The vendor believes this is credited to the ease-of-use of its software tools.

BigMachines' Value Proposition

BigMachines unifies the select and configure, price and quote, order and fulfill (with integration to back-end business systems), and report and analyze processes. Salespersons, distributors, and customers can all log-in via the Web to select, configure, and see the "single version of the truth," since BigMachines' solution helps ensure "quick, accurate responses to customer inquiries with support from virtual experts," according to a BigMachines source. The suite is available online to engineers, contractors, manufacturers' representatives, and distributors that can build product configurations and provide customers with quotes.

The modern system can also generate key performance indicators (KPIs), as well as piping and instrumentation diagram (PID) schematics (such as valve layouts) that show how different systems connect. According to a BigMachines press release from January 2008, users can standardize on the BigMachines platform across multiple divisions of the company, as Fike Corporation found, "to improve collaboration between field and internal sales teams, representatives, and distributors, and to improve customer service by ensuring their sales teams deliver more accurate orders and professional proposals to their customers." The press release goes on to say that

the new sales platform can also more efficiently manage complex product pricing and automate workflow approvals, thus better ensuring compliance with pricing policies and audit controls. The added workflow capability is helping to reduce quote turnaround time to help the user company's teams respond faster to customers.

BigMachines' product suite has thus helped customers streamline their sales processes; generate more accurate and consistent quotes (online with native real-time sales reporting and management); improve sales efficiencies (with up to 90 percent of orders flowing from the field to ERP); reduce quoting and ordering costs; and respond to their customers more quickly and professionally, with eliminated rework. Many of BigMachines' clients have also reportedly accelerated their growth via improved gross margins of about 2 percent (via consistent pricing) and increased order values by 10-20 percent (due to up- and cross-selling).

The Latest Product Developments

In its press release from May 2008, BigMachines announced release 8.2, upgrading the user interface to use more advanced Web technology features. As the press release details,

[n]ew features include dynamic, customizable interface elements, such as the ability to scale configuration input fields on-the-fly in arrays, drag and drop quotes into folders, auto-complete fields based on partial data input, expand and collapse groups, auto-fill dates from calendars, resize columns on the fly, plus much more. BigMachines 8.2 enhances automated transaction reports that enable customers to proactively track and manage user adoption. In addition, BigMachines invested substantial development resources to upgrade its core technology platform to extend the scalability, multi-language, and security features of its software to fully meet the needs of enterprise customers who have deployed BigMachines to thousands of users around the globe.

In a press release from November 2007, BigMachines announced the general availability of BigMachines LFE 8.0. In addition to a number of new features, upgrades to the application's technical architecture aim at enhancing the system's performance. New features, as stated in the same press release, include

  • native reporting capabilities to enable users to create, save, and share real-time reports and graphs

  • multi-byte support for Asian language character sets

  • ability to automatically upload or download parts, users, and configuration data via Microsoft Excel or comma-separated value (CSV) files to simplify maintenance

  • new BigMachines Extension Language (BML), to help users create and manage advanced functions for their most complex configuration scenarios

  • ability to automatically synchronize BigMachines and CRM product line items in Oracle CRM On Demand and Salesforce.com

  • additional features for system administrators, including those that aid in faster user and group administration, and auto-generated reports to track system usage and user adoption

  • optimized page compression and procedure algorithms to help speed system response

  • technical performance improvements, resulting in up to 80 percent faster processing time for many features over previous system benchmarks

This product release came on the heels of BigMachines LFE 7.1, in which the main theme was to help users improve the speed, efficiency, and quality of their customer service and order fulfillment. According to a January 2007 press release, version 7.1 incorporated new features, including:

  • easy set-up of rich home page and catalogs with user access control

  • improved systems configuration and configurator usability

  • easy up-selling of complimentary products and services

  • enhanced security and password management features

  • additional Web Service application programming interfaces (APIs) for integration to Salesforce.com's CRM system, as well as to other business systems

Mid-2006, BigMachines announced the general availability of BigMachines LFE 7.0:

[t]o speed system implementation and save administrators time, this release features on-demand administration tools that enable customers to create and edit complex configuration and guided selling rules from a single window with enhanced layout and UI generation capabilities. To make it easier to integrate with other applications and web services, BigMachines LFE 7.0 extended BigMachines Service Oriented Architecture (SOA) with additional web service interfaces.

Customers can now receive quicker turnaround for customer support by contacting BigMachines directly through a "Customer Support portal with online case management, published libraries of release notes and training materials, customer discussion forum, and upcoming roadmap features."

This concludes part two of Quote-to-order: New Ingredients in the Recipe for Success. Part three will look at what differentiates BigMachines' from other vendors in the Q2O market and the vendor's position as a provider of multitennant SaaS, as well as note a few competitors in the SaaS-Q2O arena.

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