24 Feb Salesforce as the platform of choice for manufacturing subscription management
by Tom Lovell, Jim Nader
In a recent study of manufacturing leaders, Forrester found that the top three priorities for industry decision-makers are increasing engagement, providing superior customer experience, and obtaining a single view of the customer. And, it’s for all these reasons and more that other industries at large have been turning to consumption, usage, or subscription-based revenue streams—these new models deliver greater insight into and control over the customer relationship. Subscription management is an exciting development in the manufacturing space, and setting it up with the right technology is of paramount importance.
Previously, we looked at how manufacturers—who traditionally have challenges adding new revenue streams—can take advantage of subscription-based service offerings and modernize their go-to-market strategy. Now, we want to discuss the reasons why Salesforce is the platform of choice for supporting such a pivot to manufacturing subscription management, among them being its easy integration to ERP, its customer-centric approach, and the long-term costs it saves your organization.
The complete tech stack: Salesforce builds on top of what ERP is already doing well
Many manufacturers’ gut reaction to Salesforce is to shy away, worried about how the new technology will alter its ERP setup or replace existing financial processes. This shouldn’t be a concern at all—the whole point of Salesforce for manufacturing is not to eliminate ERP but rather work alongside and enhance what ERP is already doing so well for your organization.
Think of Salesforce and its subscription management features as just another layer in your organization’s complete tech stack. Rather than overextending your ERP to do things it was never designed to do in the first place (costing your organization millions of dollars and multiple years spent customizing ERP to only yield mediocre results), enlist other partners—like Salesforce—to partner up with it and build out your process more fully.
The below graphic illustrates one hypothetical automotive manufacturing company’s interaction of these various technologies in three basic layers (data/ERP, application/Salesforce, and UX/customer or partner engagement) and how they are connected for two-way seamless API communication via Salesforce’s data integration arm, MuleSoft:
Ideally, Salesforce is leveraged in a manufacturer as this middle layer for customer engagement, relationship management, and subscription revenue management. ERP, or enterprise resource planning, is great at just that—planning physical resources, products, and assets. But the standard ERP model does not support all of the engagement that happens through commerce, marketing, and service of subscriptions, converting trials, consumption-based pricing models, etc. So while the ERP remains the foundational layer for handling a manufacturer’s order fulfillment, revenue recognition, taxes, and other financial concerns, two additional layers on top of it can set up any manufacturer for optimal customer engagement and improved selling.
— The application layer, featured here in blue, includes revenue management through Salesforce CPQ, basic CRM functionality like account and opportunity management, field service, marketing, and reporting. Your subscription-based selling will depend on having a strong and flexible application layer, with Salesforce at the helm to ensure the information sales reps need to establish new subscription-based customer relationships is reliable, easily accessible, and fast.
— The UX layer is essentially your customer or partner engagement, which can be portals, service agent consoles, mobile apps, or internal systems, depending on whether your organization sells directly or indirectly, B2B2C or B2B. Regardless, having an engaging UX layer is a strong way to build out future capabilities even beyond subscriptions, such as a customer-guided configuration of their own equipment, trial or demo registration, and self-service for subscriptions. Salesforce is also fully capable of supporting this layer, but your UX portal can also be built on other platforms and still integrate to the intermediary Salesforce layer in the middle. If you’re just starting out, don’t worry—selecting Salesforce to fill out the core middle layer makes future growth like this easy down the line.
Manufacturing subscription management with Salesforce at the helm: Ensure a customer-centric mindset leads the way
Another critical reason to use Salesforce as your platform for subscriptions in manufacturing is it ensures that mission-critical customer focus is at the forefront of all operations. As manufacturers turn to spend more time on customer relationship nurturing and seamless customer-driven outcomes, you’ll need a technology that’s built not just for your finance department’s peace of mind—leave that to the ERP.
Salesforce is designed to connect you, the business leaders, with your customers in a clear, personalized way. The Salesforce platform provides simple and consistent quoting processes for your reps to leverage with partners, distributors, and contractors, enabling small or large deals to be easily structured and managed. This all means subscription management is second nature to the platform, especially with Revenue Cloud and CPQ functionality available to the Manufacturing Cloud. You can deliver analytics that empower your reps to guide customers throughout the buying journey and remain fully integrated for constantly up-to-date product, pricing, and maintenance data.
By selecting Salesforce for subscription management, you select a customer-centric platform that empowers manufacturers to invest in their front-office systems like never before, driving business through harmonized processes and scalable technology architecture.
Declining customer faith: Manufacturing subscription management without the holistic Salesforce approach
Another key reason to select Salesforce as the foundation of your subscription management revenue initiatives is that it’s the only platform that will increase customer loyalty and foster long-lasting relationships. In other words, it’s going to save you the time and money of chasing subscription customers through any other platform. Here’s how:
Other subscription management technology providers may get you started with this new revenue model easily enough, but more likely than not, they’re not built to scale with your company’s growth. This means that even though you may see subscription revenue increase initially, your customers won’t be staying around long enough to sustain it as your sales accuracy declines and oddball contracts are more and more frequently being thrown into the sales process. Salesforce, however, is so focused on the customer journey and your company’s long-term scalable growth that its platform is equipped for stunning accuracy, flexible configuration, and its trademark 360-degree view into customer insights. By providing a low-touch, streamlined sales process, Salesforce reduces organizations’ cost per sale and delivers dynamic customer analytics all at once. You’ll never wonder how your customers feel about their current subscription plans—you’ll have a pulse on this type of data at all times on a system that is built to be mobile-first, so you can access those insights from any device.
There are many choices for that middle CRM and engagement layer in your company’s tech stack—but only one choice that reliably provides customer-centric functionality, seamless integration, and long-term cost savings. To get started with Salesforce and subscription-based revenue operations in your own organization, reach out to Simplus for an advisory engagement that sets you up for long-term success.
Tom is VP, Manufacturing CoE here at Simplus. For over 15 years, Tom has helped companies implement data and process-driven strategies to bridge the gap between business and IT. These strategies have improved patient outcomes, reduced financial risk, and improved operational efficiency in healthcare organizations while bringing to bear streamlined costs, reduced risk, and improved revenue at manufacturers. His passion is architecting and sharing practical solutions that deliver valuable results for customers.
Jim is Manufacturing Sales Director here at Simplus. He has been working in the Salesforce platform ecosystem for over six years and in the automotive and manufacturing advisory for over 25 years. Nader provides program guidance and manufacturing subject matter expertise, facilitates client project planning, and provides best practice insights on sales, service, and forecasting processes. Nader has global experience doing business in Japan, Korea, China, Germany, France, Italy, and England.