Streamline Quotation Management for Greater Profitability

  • by Uli Froehlich, Marketing Manager, SAP AG;and D.
  • Rajen Iyer, Cofounder and CTO, Krypt, Inc.
  • November 1, 2005
SAP xApp Cost and Quotation Management (SAP xCQM) is a new tool that provides a standard process for managing quotes across your entire enterprise. Learn how to deploy, execute, monitor, and refine processes and strategies quickly and flexibly with the SAP NetWeaver platform.
Key Concept
Companies use requests for quotations (RFQs) to choose vendors or suppliers of goods and services. RFQs typically ask for information such as pricing, ability to meet demands, delivery terms, and other conditions. Each RFQ usually requires a response from the potential supplier that is highly time-consuming. The completeness, timeliness, and accuracy of the RFQs are critical to winning the business. While the receipt of many RFQs benefits a supplier, it is often a challenge to complete all of them, including determining which to prioritize and which are worth the time and effort.
For contract manufacturers, requests for quotations (RFQs) are something like a double-edged sword. On the one hand, they promise new business and a boost to top-line sales. On the other hand, they can be bad news for bottom-line profitability.

Every year, companies spend millions of dollars turning around RFQs that produce no return, or that lock them into business that may cut into profitability. On average, contract manufacturers win only around 20 percent of the RFQs to which they respond, meaning an immense amount of time and effort is wasted.

SAP xApp Cost and Quotation Management (SAP xCQM) is a new composite application that provides end-to-end support for quotation management. It streamlines the RFQ process and increases accuracy. SAP xCQM is compatible with SAP NetWeaver and can be used by both mySAP ERP and R/3 customers. It is currently in Ramp-Up. As an xApp, it uses the underlying systems instead of replacing them by providing out-of-the box integration, so little preparation is required.

SAP's xCQM allows for continual change and adds an extra layer of change management. Based on SAP NetWeaver, SAP xCQM builds on top of relevant existing systems and investments (for example, SAP and non-SAP software for customer relationship management, supplier relationship management, enterprise resource planning, and supply chain management). What follows is a comparison of the previous process for managing quotes with the process using SAP xCQM.

Uli Froehlich

Uli Froehlich is a marketing manager with SAP AG, based in Walldorf, Germany. Before he joined the corporate marketing department, he held various positions including consulting and pre-sales in Germany and Australia. As member of the Global Solution marketing team, he is now responsible for all out- and in-bound marketing activities for various xApps, including SAP xCQM.

See more by this author

Rajen Iyer

Rajen Iyer is the cofounder and CTO at Krypt, Inc. Rajen has written several in-depth, best practice articles, white papers, patents, and best-selling books on SAP Logistics and SAP Global Trade Services, including Effective SAP SD and Implementing SAP BusinessObjects Global Trade Services. He is also an invited speaker at industry conferences.

See more by this author


No comments have been submitted on this article. 

Please log in to post a comment.

To learn more about subscription access to premium content, click here.