February 01, 2009

Applying Manufacturing Principles to Sales & Marketing

If the processes, tools and methodologies applied in manufacturing were applied to Marketing/Sales the result would be a revolution in terms of how organizations 'manufacture customers and sales'.

Process Re-engineering Tops the Agenda

Scientific management began with Frederick Taylor who launched scientific management, by 'taking the lid of' a steel manufacturing plant and breaking it down into processes and sub-process that could be measured and consequently optimized.  It is now time for a similar methodology to be applied to sales and marketing.

Over the past two decades process re-engineering and business process improvement have become part to everyday management speak and an important focus for organizations operating in an increasingly competitive environment. 

The Application of Scientific Principles to Sales & Marketing

Compared to other business functions, such as; production, or accounting, there is still some way to go in terms of the application of science and structure to sales and marketing.  

Traditionally sales and marketing have been considered an art, rather than a science. This is evident in such widely held views as 'marketing cannot be measured', or 'a good sales person can sell sand to the Arabs'.  The focus has been on people, as opposed to process, and creativity, as opposed to discipline.   The systems, tools, or structures required to manufacture customers have often been overlooked.

But can the principles of scientific management be applied to sales and marketing?  Could the tools that have revolutionized manufacturing allow you to reliably manage the production of customers?

Viewing Sales and marketing as a system to produce customers. 

Marketing and Sales are a form of manufacturing.  Specifically, Marketing/Sales takes suspects (raw material) and converts them to customers by means of a number of stages (leads, to meetings, cycles to orders, etc.). 

But how efficient, consistent, predictable and reliable is this system to manufacture Customers?  Are there parts of this process that can be optimized?  Terms like systematic, structured, predictable and scientific are not commonly applied to either sales, or marketing.

Where to Start?

The effectiveness of sales and marketing depends on a number of processes and process related variables.  Adjust the variables and the results change accordingly.  Doing this scientifically is the application of an integrated approach that looks beyond the people and personalities, to include; skills, systems, structures, tools, processes, etc. 

With that in mind, how effective are key processes involved in how your organizations 'customer manufacturing': 

Are enough leads produced and how efficiently are they transformed into sales meetings?

         What is the level of waste in terms of transforming leads to sales meetings to sales cycles?  

Are enough orders being produced from the stock of sales cycles?   

Have the processes for generating repeat orders from customers been optimized?

Asking these questions is the first step to the application of such progressive principles, as; Total Quality Management, Lean Thinking, Continuous Improvement, etc.


Barry Caponi said...

I agree 100%. Too often we choose some 'piece of the process' to concentrate on when a more holistic view and approach is called for. Sales seems to be one of the last bastions of 'Seat of the pants' management. Let's change that.

Mitchell Gooze said...

We obviously agree with your comments as we have been focused on this exact concept which we term Customer Manufacturing, for 10 years. We appreciate the vote of confidence. To learn more feel free to visit our site at www.customermfg.com

Tom Saichek said...

As someone who has brought sales and marketing processes into many organizations, I agree that this approach is long overdue. I have found the folks at Customer Manufacturing to be focused on this topic and to be at the forefront of the discussion. This is an area in which we all would be well served if it were to become the norm.

Ralph Mroz said...

Another fellow here with Customer Manufacturing Group. It seems that the people at ASG have come to the same conclusions in the UK as we did here in the states, starting in 1999. If the ideas they present in this blog post make sense, then you might want to check out our book on the subject, Value Acceleration--go to www.valueacceleration.com