Digital Strategy

Four Examples of Engineer-to-Order Pain Points (And How to Solve Them)

August 4, 2020

Custom-engineering each of your new products to order has its own unique challenges — and unique opportunities for success.

Making custom-engineered products is a unique challenge that’s equally satisfying (and profitable) when done well. It’s unique because the pain points usually found in design changes, process complexities, and cross-team collaboration multiply when you’re engineering each new product to order.

The chances for success — and failure — double.

Sales and engineering misalignment is often at the root of problems in an engineer-to-order (ETO) environment. A lack of sales and engineering alignment can result in a poor customer experience, a decrease in revenue, lower new product revenue, lost business and lower product margins.

Engineering and sales teams need to work closely together during the development process for an ETO company to make a profit, but don’t often do it well, even though they share goals of closing deals faster with more precise quotes, beating out their competitors and creating products they’re proud of.

The faster sales can respond to customers, and the faster engineers can work off of correct specifications, the more accurately the two teams can collaborate, reducing costs, saving time and meeting customer needs.

We’ll dive into four top issues teams at custom-engineered product companies face, and how to solve them with sales and engineering alignment. But first:

Why does sales and engineering alignment matter?

Reminder: Sales and engineering alignment is the maintained state of continuous cross-team coordination of all data points necessary to sell and produce a custom-engineered product.

This can include project objectives, product development, component costs, customer feedback and requirements, and any other details during the decision-making process of defining, designing, selling and producing engineered products.

True alignment means the two teams are able to work collaboratively from the beginning of the quoting process using constant communication and data visibility that allows them to deliver a great customer experience.

Four pain points in ETO and how alignment solves them

Along the customer journey, from the initial design process to delivering the ultimate end products, it's key for your sales team and engineering team to be aligned every step of the way. Here are the four main obstacles to achieving your company's full potential for long-term success.

Bad quotes leading to lost deals

The saying goes, “if at first you don’t succeed, try, try again” — but in engineer-to-order business, if you don’t get the quote right on the first try, it’s very possible your company loses any chance of being able to repair broken trust with your customer base or recover lost revenue.

Quote precision in custom-engineered products is both a science and an art. Adding up initial budgeted costs would seem to be a simple matter of addition, however, ETO products are often new technologies that are complex enough in the beginning to result in further complexity down the road. This is due to misalignment. Salespeople may promise more price cuts on the phone and jotting down new feature requests to a customer while engineering is still struggling to meet initial scope.

Information consolidation increases focus.

A quick way to reach sales and engineering alignment on quoting practices is to integrate your enterprise software, primarily, integrating your PLM with your CRM. This can automate all processes from the initial customer request to quote, creating instant visibility across your value chain, and between sales and engineering activity.

Information consolidation increases focus, whereas app overload can affect the user experience: According to a 2017 study, 67 percent of surveyed workers said they believe it would be easier to focus on work if important information from all of their apps appeared in a single window. Platform consolidation isn't just good big data hygiene — it's necessary for providing your employees and customers with a positive experience with your brand.

Ensure precise quotes by managing all tasks, deliverables, and requirements needed to deliver a custom-engineered product on one platform fully integrated with the overall sales opportunity to ensure speed and accuracy.

Too many change requests

Unexpected, sudden, constant changes to a plan rarely makes a pleasant or efficient workplace in any industry. Research published in the International Journal of Stress Management found that workers who are frequently interrupted reported nine percent higher exhaustion rates than usual, almost as high as the reported 12 percent increase in exhaustion due to work overload.

Some of this can’t be avoided in the ETO environment. However, in custom engineering, where requested changes to the desired product are a normal part of the team’s workflow, change requests are often handled poorly due to a lack of standardized project management systems paired with communication roadblocks. Unavoidable parts of manufacturing ETO products become unmanageable and time-consuming — making additional change requests near-impossible to fulfill.

Respond quickly to changes in business requirements by using a single enterprise software platform for sales, engineering, and operations to collaborate, communicate, and update product designs. With full visibility, engineering can see and plan around incoming changes sooner.

Poor workflows and overwork

Pain in ETO workflows is two-pronged. First, a typical ETO workflow has sets of “swim lanes” of information between departments, pictured below, that each present a potential for error due to many siloed systems, spreadsheets, emails, and manual processes.

Every time a piece of information changes hands in a custom-engineered product lifecycle, there is an opportunity for that information to be duplicated, stored incorrectly, or miscommunicated. This challenge can be solved using automated processes and integrated project management, as mentioned above.

Second, the outcome of those broken workflows happens to real human beings.

Engineers are overworking on bad sales deals, under pressure from salespeople who need to deliver on time and meet quota. Engineers are getting bugged all the time, taking them away from their true work, and salespeople are busy talking to the customer, operations, and engineering to see if they can save a deal or solve a new customer pain point.

In rarer cases, engineers can work ahead of sales’ demand, creating unpredictable pockets of downtime and skewing pipeline projections and adding to more overwork later when sales hands engineers more work than they can then sustain.

Broken workflows affect real human beings.

Either way, it’s hectic, and without the proper systems in place, it pits salespeople and engineers against each other — a battle that engineers usually lose.

By aligning your sales and engineering teams, you take them out of that battle and put them on the same side: the side of the customer. Enabling these two opposing forces to work in harmony ensures that no one team bears more of a workload than the other so they can stay focused on the design process, product development, and providing a great customer experience.

Decreased margins

Even with the best roadmap in place, bad quotes, change requests, and overwork mentioned above all pile up one after another, resulting ultimately in decreased margins, slower time-to-market, and disrupting your supply chain.

After all that work to create a custom experience the customer could not get elsewhere, crafting a custom-engineered end result, and many of your team working nights and weekends to make it happen — after all of that, a flimsy return on all that investment is a disappointing and ultimately disastrous end result.

To protect your margins, your long-term success and the successful growth of your business, you must protect every point of the custom engineering process from quote to continued service from your support team.

If Tech-Clarity found in a recent survey that 46 percent of companies who make custom-engineered products have both trouble predicting costs and trouble reacting to opportunities quickly enough, your organization can compete by aligning sales and engineering for smoother, faster, earlier communication in the product lifecycle, ensuring proposals and designs deliver what customers need with tighter collaboration, ultimately delivering more profitable orders.

Learn more about how you can solve customer pain points and custom-engineer your processes toward success in The Ultimate Guide to Making Custom-Engineered Products.

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Author

Joanna Rutter

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