Our sales and operations planning is not hitting the mark. Operations work hard, within the constraints of available hours. They take delivering on promises seriously and feel blindsided about last-minute job requests. They have no say in job scheduling or delivery dates. We all assume operations can deliver as promised, without consulting with them when a deal is being put together. And, when we fail to deliver, they get the blame.
Thoughts of the Day: Sales and operations planning is critical. Customers want to know that they will receive what was promised. It’s teams of people who pull off the promise. Rely on reporting systems to spot problems before they happen. Increase customer and employee satisfaction. The goal is a job well done every time.
Sales and operations planning
It’s important that everyone in the company is clear on the standard to be met.
- On-time every time
- No finger-pointing
- Commitments made are within the scope of the company’s ability
- Projects are within budget
- Accepted work can be handled effortlessly by a team well prepared to deliver
Consider these objectives when setting company standards. Auditing to make sure that all parties meet the standards. Help pinpoint problem areas that need attention. Cut down on misplaced customers commitments. Decide, pre-commitment, if the job should be taken on. This process needs to answer a series of questions.
- Do we have enough capacity available at the time needed?
- Is it a good project (profitable, something we consistently do well)?
- Are any other commitments likely to come in that could get in the way?
- If we need to use outside resources, are we sure they will be available?
A cross-functional decision-making process
Set up a hand-off/negotiation process between sales and operations planning. Accurately describe incoming work. Evaluate the process at the time of hand-off. Making sure all parties communicate about issues and resolve concerns before getting into the guts of a project will lead to better outcomes for everyone concerned, including the customer.
Keep active projects visible for all team members. Have a board that displays work proposed, contracts coming in, deals in process, jobs completed. Put someone in charge of updating the board daily, hourly if necessary. Consider putting the board up in a conference room, or a wall that everyone inside the company passes by.
Have sales and operations staff meet daily to review what’s on the board, discuss possible changes, and identify roadblocks to success. Have someone take notes during the meeting and quickly circulate to-dos to all affected departments. Clear roadblocks. Review the to-do lists at daily check-in meetings.
Aligned company-wide business functions
Set a limit on capacity – somewhere under 100% of what operations can deliver. Reserve that limits for two different functions. One-half goes to last-minute requests that are high-quality, high-profit opportunities. The other half is flexible schedule work that can speed up or down depending on how smoothly operations are performing. Let salespeople know when the cut-off is getting close, and hold sales within the limit.
Encourage sales and operations planning staff to evaluate capacity regularly, and to under- rather than over-forecast what they can handle. Allow for downtime due to staff days off, machinery repairs, and vendors who don’t deliver according to schedule. Anticipates issues and will help to improve outcomes.
Make sure that everyone belongs to the same team. Reward everyone for overall success rather than individual success. Consider the constraints operations have to deal with. Commissioned salespeople often forget that. Operations may feel frustrated, thinking they do all the work as they watch sales get all the congratulations. Recognize all players for selling and delivering on time, on budget. Reward teamwork that identifies and heads off problems before they blow out of proportion. Encourage and promote team players.
Looking for a good book? How to Succeed with Continuous Improvement: A Primer for Becoming the Best in the World, by Joakim Ahlstrom.
