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Home » Ryder’s Fleet Management Unit Tackles the Complexities of Price Configuration
Case Study

Ryder’s Fleet Management Unit Tackles the Complexities of Price Configuration

Fleet Management
A fleet of cargo vans sits in a parking lot. Photo: Shutterstock.
February 13, 2019
Robert J. Bowman, SupplyChainBrain

The ways in which a commercial truck can be configured for leasing seem limitless. So how can the lessor boil down this complexity into a coherent offering to the customer?

For years, Ryder’s Fleet Management Services division had relied on homegrown sales automation software to spec vehicles for lease. That tool was scrapped when it implemented the customer relationship management (CRM) system of Salesforce.com, Inc. Next on the agenda was a new configure, price and quote (CPQ) application, to consolidate the work of multiple systems and individuals.

The search was prolonged by a feeling within Ryder that its unique and complex CPQ needs couldn’t be met by an off-the-shelf product, says Jose Alvarez, director of sales operations in the Fleet Management Services division. It took the running of a “minimal” proof of concept to convince the company otherwise.

Reviewing what the market had to offer, Ryder first looked at the biggest vendors in the CPQ space, including BigMachines, which was acquired by Oracle in 2013. What wasn’t on its radar at the time was Tacton, a smaller CPQ vendor based in Europe.

Several things happened to draw Ryder’s attention to Tacton. One was the latter’s move to open an office in the U.S. and expand its presence in that market. Another was a partnership between Tacton and Salesforce, resulting in creation of the Tacton CPQ for Salesforce application.

That development boosted Tacton’s credibility in the eyes of Ryder. So did an endorsement by Daimler Trucks North America, one of Ryder’s main vendors. Finally, there was the fact that transportation was one of Tacton’s core verticals. It demonstrated to Ryder that “they are paying attention to our industry,” says Alvarez.

“Our configuration needs are not trivial,” he adds. Ryder requires individual SKUs for each of the options that make up a vehicle configuration. Potentially, that could lead to a huge number of possible combinations that become unmanageable. For a lessor of Ryder’s size, it was crucial to find a product that could scale.

After narrowing down the field of candidates to just two, Ryder selected Tacton. The vendor’s cloud-based system was easy to manage, Alvarez says, yet powerful enough to handle all possible configurations.

“In the end,” he says, “what tipped things on Tacton’s side was their obvious knowledge of the transportation sector.”

Tacton chief executive officer Fredric Laziou says the company seeks to promote “smart commerce” through its CPQ product. “It’s not about selling a piece of hardware anymore,” he says. “It how do I connect over the [vehicle’s] lifecycle, and make sure I have a tailored solution for the customer.” Other verticals on which Tacton focuses include heavy machinery, power generation and medical equipment.

Tacton had deep knowledge of the trucking industry, but less so the financial services sector. Nevertheless, says Laziou, Ryder didn’t present the vendor with a unique challenge. Like Ryder, a number of Tacton’s other accounts are pursuing a business model that requires extended engagement with customers over the life of the physical asset.

Ryder chose Tacton at the end of 2017, and launched a pilot project the following year. The initial engagement involved a small subset of vehicles and users, ranging across the whole process of configuration and leasing.

“Generally speaking,” recalls Alvarez, “things went very well.” At the same time, Ryder faced a challenge in integrating the new CPQ tool with various legacy systems on the back end.

Lazious says it was important for Tacton to accommodate Ryder’s ambitions to become a global company. That meant being able to engage with the client’s U.S. operations, while providing domain knowledge from Europe.

Phase two of the implementation is currently underway, involving larger data sets and expanding use of the configuration model to eventually cover the lessor’s entire offering of vehicles and options.

One of the great values for Ryder,” says Laziou, “is to have one single source of truth.” The CPQ tool, he adds, links the CRM side with Ryder’s substantial store of data related to computer-assisted design and product lifecycle management, serving as “the glue between the customer and the solution.”

Ryder plans to wrap up implementation of the CPQ system in the third quarter of this year. Alvarez describes the process as “arduous, in the sense of the amount of information we have to put in, to make sure all the configuration rules are working.”

Early stages of the initiative are already yielding benefits, especially in the form of increased productivity. “As our salespeople start using the new system,” Alvarez says, “they’re now capable of looking at things differently.”

Still, shifting the salesperson’s traditional way of doing things can be a challenge. Veterans tend to want to stick with the old processes. With experience, however, they find the new system easier to use, Alvarez says.

So far, Ryder’s use of the Tacton CPQ software has been limited to the company’s fleet-management operations. But Alvarez believes it could be of value to the supply-chain side of the house as well, involving transportation and warehouse-management services. He says Ryder’s supply-chain staff is closely following the implementation. “I foresee them being able to leverage something and put together a solid solution for the customer at a fraction of the time.”

In addition to supply-chain applications, Tacton intends to broaden the use of its tool to include functions such as price optimization and the aftermarket. Recently it announced the addition of visualization capabilities through augmented reality.

As for Ryder’s Fleet Management Services division, it hopes to reap further benefits as it applies the CPQ capability to its entire product line. Says Alvarez: “The sky becomes the limit as to how we can make the most out of the product, once we’re on that platform.”

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KEYWORDS Big Data/IOT Cloud, SaaS & On-Demand Systems configure price quote trucking CPQ CPQ fleet management fleet management fleet management systems LTL/Truckload Services Sales & Operations Planning SC Finance & Revenue Management Technology Transportation & Distribution
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