The manufacturing industry is incredibly complex. Manufacturing Sales involves numerous parties, each with their own processes. To help you understand each party better, we compiled a glossary filled with commonly used acronyms and terms—with a digital-focused spin. Let us help you to build up your knowledge so you can take control, and accelerate your manufacturing digitalization projects. Watch this space as we continuously update this list with the latest digital manufacturing terms.
ASCL - Average sales cycle length
B2B Sales – Business-to-Business
There are many factors like material costs, supplier mark-ups, or market conditions that affect it. These factors lead to critical risks that are best managed with a digital solution that encompasses the entire sales process.
A digital sales platform can also help manufacturers manage external sales channels such as partners or distributors and enable new ones such as digital commerce.
When an item is a sub-component, it shows all the different components, such as the purchased parts and raw materials. When BOM levels increase, the complexity of cost calculation increases along with it.
This is where a CPQ built for manufacturing can help. A modern CPQ extracts the most updated information from the ERP and perform complex calculations that consider each BoM level.
This elasticity gives cloud computing the advantage over owning (and operating) a costly on-premise IT infrastructure. Cloud is the key to digital success and the backbone of smart (or digital) manufacturing. It allows manufacturers to explore new production systems, modernize operations, and explore new business models.
CLTV / CLV – Customer Lifetime Value
Businesses typically use this metric to identify potential customers to focus sales efforts on for the highest returns. While CLV can be observed manually, a well-integrated digital sales platform uses advanced data analytics to help sales teams quickly identify high CLV opportunities.
CMS - Content Management System
However, in manufacturing, the impact of a CMS is not just skin deep. It is used to manage content in digital sales channels enabled by a digital sales platform. Partner, distributor, and customer portals are easily maintained from one system, allowing control and efficiency.
CPQ – Configure-Price-Quote for Manufacturing
A CPQ enables manufacturing sales teams automated, two-way access to that data—resulting in faster, more accurate quotes for complex products and a cleaner ERP. Besides automating the sales process, a CPQ also allows manufacturers to respond faster and more accurately in other aspects of the business, such as production.
A CPQ needs to be tightly integrated with a manufacturer's ERP for it to work. But a CPQ's true potential is realized when it is coupled with two other essential services: CRM and E-Commerce.
CRM – Customer Relationship Management for Manufacturing
At the same time, it keeps sales teams and customers updated with the latest data from the manufacturer's ERP, CPQ, or Commerce systems. It provides manufacturers with a 360-degree customer view and the ability to match the customer's request for speed and customization.
CX – Customer Experience
B2B customers experienced the convenience and speed of the B2C buying experience—and are expecting their B2B interactions to be on par as well. Satisfied customers are more likely to become loyal, repeat customers.
Many businesses in the B2B manufacturing industry invest heavily in manufacturing-focused digital sales platforms to ensure a consistent customer experience across all touchpoints so that customers stay loyal.
Manufacturers that adopt digital see tangible benefits like productivity gains, reduced bottlenecks, minimal errors, improved quality, shortened time-to-market, and most importantly, increased revenue. One of the most commonly digitalized processes is the sales process.
A digital manufacturing sales process is automated and streamlined to shorten the sales cycle. A digital sales platform also impacts several other parts of the business, such as production and fulfillment.
E-Commerce - Digital Commerce
EMS - Electronics Manufacturing Services
ERP - Enterprise Resource Planning
ETO – Engineer-to-order
Lot Size of One
MaaS – Manufacturing-as-a-Service
MTO - Manufacturing-to-Order
MTS - Made-to-Stock
ODM - Original-Design Manufacturer (Private Labelling)
OEM - Original-Equipment Manufacturer
PaaS - Platform-as-a-Service
PLM - Product Lifecycle Management
Q2O, QTO - Quote-to-Order
RFI - Request-for-Information
This step of the sales process is critical for manufacturing firms. The faster the RFI response, the happier customers are, and the higher the chances sealing the deal. For manufacturers, cost or price accuracy is also just as important with it comes to RFIs. Without accuracy, the RFI process gets dragged out. Or when the deal comes in, margins are low to negative.
RFQ, RFP - Request for Quote, Request for Proposal
In both cases, manufacturers with integrated digital sales platforms can respond much faster to RFPs and RFQs than their competitors. Digital sales platforms have real-time access to ERP information and can help sales teams configure quotes and proposals in minutes instead of days.
ROI – Return-on-Investment
For entire processes such as sales, RODI is determined by deal speed and sizes. Digital maturity also plays a part in achieving higher RODI. Digitally mature companies often have processes that assess and improve their digital initiatives' performance—resulting in much better business performance than their less mature competitors.
SaaS - Software-as-a-Service
Instead of merely lifting capabilities off on-premise infrastructure and putting them in the cloud, SaaS solutions come with value-added benefits inherited from the platform they are built on—such as enhanced security and scalability.
Resource intensive tasks such as complex, large-scale calculations or data analytics enabled by advanced tools like a CPQ are also done on cloud platforms. For manufacturers manufacturers, SaaS provides powerful capabilities without heavy investment in on-premise infrastructure.
SAP CP - SAP Cloud Platform (previously known as the SAP HANA Cloud Platform)
SAP's enterprise Platform-as-a-Service comes with comprehensive application development services and capabilities. Manufacturing services built on the SAP Cloud Platform (like the In Mind Cloud Digital Sales Platform) use best-of-breed integration and extensions that are secure and agile by default. Powerful APIs also allow for deep, seamless integrations into SAP's comprehensive manufacturing solutions like the SAP Cloud ERP, for instance.
SEC - Sales Enquiry Checklist
An SEC is an essential tool for customer requirement discovery. It helps manufacturers gain a deeper understanding of what customers need during the initial engagement. With the checklist in hand, a manufacturer's sales team has a point of reference for the customer's requirements to ensure exact fulfilment. An SEC is one of the most critical elements of a manufacturer's sales process. A deal's success depends on the manufacturer's ability to deliver according to the customer's specifications.
Smart Manufacturing - Digital sales
Take the sales process, for example. Manufacturers that digitalize their sales process not only close bigger deals faster but are also able to optimize production to reduce costs, create new business models, and achieve faster Time-to-Market.
Having an SOP also helps manufacturers reduce friction, miscommunication, or non-compliance with regulations. In the age of Industry 4.0, smart manufacturers use digital automation to maintain business-critical standards. Processes like sales benefit tremendously from this approach. Not only does the sales process get sped up, but the impact of a digital sales solution can also be felt from production through to after-sales.
TCO - Total-Cost-of-Ownership
All additional costs are shifted into operating expenses (OPEX), which can help relieve cash flow. Cloud-native software like a digital sales platform also comes with value-added features like robust security and scalability—providing manufacturers with more opportunities to lower costs.
If a manufacturer takes too long to complete this cycle due to the inability to adapt to market conditions), their competitors might be able to corner the market with the first-mover's advantage. With a digital sales platform, manufacturers can streamline multiple steps in the TTM process—and accelerate it.
TTQ - Time-to-Quote
With a digital sales platform, the TTQ can trim down to mere hours thanks to smart automation. The processes that can be automated include configuration, calculation, and even approvals.
A streamlined TTQ also helps manufacturers respond to requests from time-challenged customers while lowering the time (which equates to money) it takes to prepare a quote.
TTV - Time-to-Value
In digital sales, manufacturers often find exceptional value in the speed that results from the automation of manual tasks, product configuration, and of course, securing winning deals.
Do you want to learn how to build a sustainable strategy to respond to current and future manufacturing sales challenges? Download our Guide to "Accelerate Manufacturing Sales"!