Are you a recruiter searching for a Salesforce CPQ expert or a consultant/admin looking to break into the Salesforce CPQ space? If so, this article is for you! Although Salesforce purchased Steelbrick (Salesforce CPQ) back in December 2015, it feels like the space is still heating up for Salesforce professionals. There is a huge demand for Salesforce CPQ experts so interviewers (and interviewees!) should come prepared.
Due to Salesforce CPQ’s complex nature, this article will break the questions into three groups:
- CPQ general knowledge
- CPQ use cases
- Project experience
Let’s get into it!
I will give an overview of what a good answer could be, but due to the complex nature of CPQ, actual answers will vary. Salesforce CPQ is a highly specialized skill set that requires out-of-the-box thinking and the ability to problem solve while on the go. Having a deep understanding of the tool and its features is key, but having a mental library of use cases ready to go will give you a much better chance of landing a CPQ role.
Even more important than use cases and product features is project-based experience. Rolling out CPQ is not like rolling out other Salesforce features, as CPQ relies on complex relational data being moved between multiple environments.
CPQ General Knowledge
1. What is CPQ and why is it important?
CPQ stands for Configure, Price, Quote. CPQ makes up one part of the sales process and is part of the larger Quote-to-Cash / Lead-to-Cash process within an organization. It can span multiple teams including, sales, legal, finance, and sales operations.
Having a well configured CPQ tool is essential for sales and operations teams to create accurate quotes with correctly configured products and pricing.
2. What is a Bundle?
A bundle is a logical grouping of products that are sold together and form a single quote line item. For example, if you buy an entertainment package from a media provider, you may receive multiple services such as phone, internet, and television services, but you will pay for a single product, the entertainment package. The same concept applies in Salesforce CPQ.
Products can be sold together as part of a bundle or standalone. Bundles can have complex logic applied to them through Product & Price Rules.
3. What is a Product Rule?
Product rules are used to enforce specific configurations either at the bundle level or the quote level. There are four types of product rules: validation, selection, alert, and filter.
- Validation: Prevents a user from saving an incompatible quote/bundle configuration.
- Alert: Notifies users of important information but does not prevent the user from saving the quote.
- Selection: Automatically selects, deselects, shows, or hides products based on defined parameters.
- Filter: Used in dynamic search filters which will automatically filter the product catalog.
4. What is a Price Rule?
Price rules are a very versatile tool that can be used to ensure products are priced correctly. Price rules can also be used to inject a static value, field value, or summary variable into a quote or quote line field.
This means they can be used for more than just pricing use cases. Price rules can have a condition (or multiple conditions) defined to tell the system when to apply the price action, but conditions are not essential.
5. What is a Summary Variable and how is it different from a Roll Up Summary?
Summary variables summarize number fields (such as quantity or price) and allow you to define criteria for the summary such as product code or product family. Summary variables run specifically within the quote line editor and the value is not retained* in the system once the calculation is performed. This means you are not contributing to the limit for roll up summary fields on objects (25 in most cases but can be increased to 40).
Roll up summary fields behave in the same way, but the value is not calculated until the record is saved – whereas Summary Variables are calculated within the quote line editor and are usually used for the purposes of triggering product or price rules.
A good example would be if you are offering a discount on all quotes over a certain threshold, let’s say $1,000. You would define a summary variable to add up the gross amount of all quote line items, and if the value is over $1,000, then a price rule could be triggered to automatically apply a 50% discount to the entire quote.
Note: You can retain the value by using a price rule to populate the value into a field on the quote or quote line.
6. Explain the difference between a Subscription Product and a One-Time Product?
- Subscription product: A product that generates recurring revenue – e.g. software license, ongoing service subscription, a product which is leased or rented, etc.
- One-Time Product: A product that generates revenue once – e.g. a physical good that is sold rather than rented or leased, a perpetual software license, a fee for implementation services, etc.
7. What are CPQ Twin Fields?
Salesforce CPQ Twin Fields automatically map data between two fields on different CPQ objects. Typically, data from Quote Line records needs to be copied to resulting subscription records, order product records, and opportunity product records (at the very least). Admins simply need to create the same field type with the same API name on every object, and the system will copy the value upon the record’s creation.
8. Why are the following Global Settings important?
Subscription Prorate Precision
- Subscription Prorate Precision defines how the system will calculate any non-whole terms for subscription products e.g. if the term is six months and three days, how the system will calculate the price for a subscription product with a yearly price.
- The options are Day, Calendar Monthly + Daily, Day with Calendar Month Weighted, Monthly and Month + Daily. Each produces a slightly different calculation, and this setting applies to every quote in the system.
- A detailed breakdown of each setting is available here for more information.
Re-evaluate Bundle Logic on Renewals
- This setting is important as it defines if bundles are re-evaluated upon renewal. This means if you have changed the structure, rules, or price of a bundle between the time it was first sold to the time of renewal, it clarifies whether the system should apply the new rules, structure and/or pricing or have the bundle remain the same as when the customer first bought it.
- Let’s use the entertainment package example from earlier as an example. If a customer purchased a bundle during a promotion and they got a great price, plus the movie and sports package included for free, should the bundle be re-evaluated by the system when the customer’s package is up for renewal? If yes, this global setting should be checked. This will apply across all bundle products in the system.
Preserve Bundle Structure
- This setting is important because it preserves the structure of a bundle when contracts are amended. Without this setting enabled, bundled line items will be translated to individual line items and will not be related to the parent product when a contract is generated. This means if the contract is amended in future, the original bundle structure will not be in place. This is a global setting and will apply to all quotes.
Allow Multiple Orders
- This setting is important as it enables the ability to have multiple orders generated from a single quote. This is useful if you need to split line items on a quote into more than one order, such as if you are selling to multiple business units and need to generate a different invoice for each order.
9. What are Contracted Prices?
Contracted Prices are related to a specific account and override the Regular Price of a quote line, based on a special price the customer has agreed. Contracted Prices apply in the “Special Price” field which is part of the CPQ Price Waterfall. Contracted Prices will get pro-rated in Amendment scenarios.
10. What are Contract Amendments?
Contract Amendments are used to upsell or cross-sell an existing customer during their existing contract term. For example, a user sells ten software licenses to a customer for a one-year term, starting 1 January 1 and ending December 31.
In March, the customer comes back to you for five more licenses. The user would create a Contract Amendment to sell the five extra licenses from March-December rather than starting a new contract from March-February.
Using Contract Amendments ensures all subscription products renew on the same date, making it easy to handle renewals when the time comes.
11. Explain the difference between Products and Product Options
Products are the records that hold specifics such as Product Name, Product Code, Product Description, etc.
Product Options are records related to two Product records, the Configured SKU (the Parent or Bundle product) and the Product record that holds the Option itself.
An example would be as follows:
- The Parent Product is the Solar Controller Hub.
- The Product Options are items like the solar panels and mounting kits.
Product Option records are related to two Product records, the Configured SKU (Solar Controller Hub) and Optional SKU (Solar Panel, Mounting Kits, etc.).
Product records which are not to be sold outside a bundle must have the field “Component” checked. This removes them from the Product Catalog.
12. Explain the difference between a Quote and an Order
Although the records contain a lot of the same information, Quotes are used to create proposals for the prospect or customer and will contain things like optional products, quote terms and can be used to capture a signature.
Orders are created by Sales Ops or the Finance team and are used to prepare invoices for the customer based on what they have purchased. Data from the primary quote will flow downstream to the Order record such as Account Name, Opportunity Name, Quote Lines > Order Products, etc. but could contain additional financial information such as billing period, and VAT number, etc. In many cases, the Quote and Order will be exactly the same.
CPQ Use Cases
1. Explain why ‘X Industry’ is a good fit for CPQ
Ask the interviewee why your industry is a good fit for CPQ – this will test their understanding of what you do and how they see CPQ providing value to your organization.
Manufacturing is a good fit for CPQ because manufacturers often sell complex products that can be configured in a number of ways. This can make it hard for non-technical salespeople to create proposals and sell the products, as well as make it difficult for the team building the product if they do not know exactly what the customer ordered. Salesforce CPQ empowers non-technical salespeople to sell complex products by having guardrails in place to prevent incompatible configurations.
Salesforce is the best example of a high-tech company using CPQ. Salesforce sell a number of licenses which can be sold either in packages or standalone, and as their product catalog grows through internal product growth and mergers, having a tool like Salesforce CPQ makes it easy to sell a highly complex catalog of products.
Example: Professional Services
Professional Services companies, such as Accenture, Deloitte, and PwC, offer resources (people) to staff projects. Resources usually have a fixed cost based on their location, and every project will require specific resources to achieve the end goal. Having a CPQ tool in place can make it easy to configure a quote for resources based on the client’s needs.
2. What is the difference between Product Rules and Option Constraints?
Option Constraints are a simplistic version of product rules allowing users to exclude or require an option based on the selection of another option, e.g. a user selects option A so they must also select option B.
Product rules are far more sophisticated and have four types of rules: validation, alert, selection, and filter. The selection type will provide the same functionality as Option Constraints but with more features.
3. Give a Use Case for Lookup Data
Lookup Data can be used with both Product & Price Rules and is used in place of error conditions to drive actions in the system. Lookup Data is effectively a static matrix table located in an object that is used as a reference.
For example, let’s say you want to apply an automatic discount based on information on the Account record.
Let’s say you have a partner discounting program in place. Partners are given a general rating based on their size and resource skill set, but number of delivered projects are also tracked and influence their discount. The more projects they deliver, the bigger the discount. You can even configure the Discount field on the object to automatically update as more projects are delivered, for example.
|Number of Projects Delivered
The lookup data is used by the Price Rule and the discount is applied automatically based on the matching parameters in the lookup data and what’s on the quote record.
4. Give a Use Case for using Price Rules to populate Non-Pricing Fields on the Quote Line Object?
One possible use case is to use a price rule to populate the value derived from a Summary Variable into a field to hold it permanently. Summary Variable values are derived dynamically and are not stored by default anywhere in Salesforce. If you need to store the value, create a price action to populate the value from the variable in a field on the quote object.
5. How can you simplify the look and feel of a customer’s Product Catalog using CPQ?
The Product Catalog can be grouped using either Product Family or another custom field to sort and group products together. This setting can be found in the global package settings.
1. Give some examples of CPQ-specific discovery questions for Requirements Gathering
- How do you sell your products (i.e. bundles, standalone, etc.)?
- Do you have complex rules about what can and can’t be sold together?
- What is your pricing method (i.e. subscription, one-time, milestone, etc.)?
- What is the process to send a quote to your prospects and customers today?
- Do you offer contracted pricing or volume pricing to customers?
- How do you record the commercial terms agreed with a customer?
Note: There are many more discovery questions, but these examples show that the candidate understands the nuances around CPQ development and what information is needed.
2. Explain the migration process for CPQ data
Salesforce CPQ data is relational data, which means moving it between orgs is extremely complex. Because Salesforce record IDs change in each org, a separate ID on the records that are being migrated would be helpful to use when referencing related records. An admin could create a custom auto-number field on every object that will require migration, but this will be extremely time consuming and will still result in a complex migration process. The recommended option is to invest in and utilize a third-party tool such as Prodly or Gearset to move this data.
3. Explain how to roll out Salesforce CPQ (at a high level)
Salesforce CPQ will require a phased deployment and the process should be planned well in advance. At a high level, the following steps are required:
- Install CPQ package in Production environment for admins only.
- Migrate fields to Production.
- Migrate relational data to production.
- Update Global Package settings.
- Smoke test with admins and a small group of test users who have been given the required permissions.
- Add Permission Set License to all users who require CPQ permissions.
- Add relevant permission sets to all users who require CPQ permissions.
- Monitor usage and monitor hypercare channels (email, Slack, etc.).
These Salesforce CPQ interview questions are just some that may be asked in an interview. Every interviewer is different and will likely have a differing set of questions and their own style of interviewing, so it’s best to always go in with an open mind and be prepared to show off your knowledge.
It’s always good practice to touch up on the areas you’re unsure about, so hopefully this guide can help you highlight some of those areas to focus on. Good luck!