Marketing-Sales-Operations
Transforming businesses from obstacles to prosperity
Stephen J. Homola
Never in the history of business operations has business confused these three utilities been more misused and confused than in the 21st century business. MSO is an integral function, regardless the size of the business. Plan and simple:
Marketing
Marketing is the means by which a business entices the prospect toward their business to become a customer.
Sales
A Sale is the means to meet the prospect and to convince them to become a customer within their business offering.
Operations
An Operation is the method to meet/exceed the customer’s requisite needs to fulfill the requirement of their business.
It is imperative that every business recognizes the strategy of MSO is to secure, fulfill, and deliver. They are unique, but are so integrated that the quality absence of one will suffer the remains.
Marketing is a process that can allow an organization to concentrate its limited resources on the greatest opportunities to increase sales and achieve a sustainable competitive advantage. A marketing strategy should be centered on the key concept that customer satisfaction is the main goal.
Marketing strategy is a method of focusing an organization's energies and resources toward a course of action, which can lead to increased sales, and dominance of a targeted market niche. A marketing strategy combines product development, promotion, distribution, pricing, relationship management and other elements; identifies the firm's marketing goals, and explains how they will be achieved, ideally within a stated timeframe. Marketing strategy determines the choice of target market segments, positioning, marketing mix, and allocation of resources. It is most effective when it is an integral component of overall firm strategy, defining how the organization will successfully engage customers, prospects, and competitors in the market arena (i.e.) corporate strategies, corporate missions, and corporate goals. As the customer constitutes the source of a company's revenue, marketing strategy is closely linked with sales. A key component of marketing strategy is often to keep marketing in line with a company's overarching Mission Statement.
Basic theory:
Target Audience
Proposition/Key Element
Implementation
Campaign and Actions
A marketing strategy can serve as the foundation of a marketing plan. A marketing plan contains a set of specific actions required to successfully implement a marketing strategy. For example: "Use a low cost product to attract consumers. Once our organization, via our low cost product, has established a relationship with consumers, our organization will sell additional, higher-margin products and services that enhance the consumer's interaction with the low-cost product or service."
A strategy consists of a well thought out series of tactics to make a marketing plan more effective. Marketing strategies serve as the fundamental foundation of marketing plans designed to fill market needs and reach marketing objectives. Plans and objectives are generally tested for measurable results.
A marketing strategy often integrates an organization's marketing goals, policies, and action sequences (campaign) into a cohesive whole. Similarly, the various strands of the strategy, which might include advertising, distribution, Internet, promotion, and public relations, can be coordinated. Many businesses cascade a strategy throughout an organization, by creating strategy tactics that then become strategy goals for the next level or group. Each one group is expected to take that strategy goal and develop a set of tactics to achieve that goal. This is why it is important to make each strategy goal measurable. Marketing strategies are dynamic and interactive. They are partially planned and partially spontaneous.
The 21st century approaches are based on relationships, customer intimacy, and supplier-customer partnerships. The phrase “It is not personal. Its just business.” Is as antiquated as the typewriter. All business is personal! Why would anyone consider it otherwise? This evolution from the 1970s to present encompasses the past and evolves into current business environments.
|
Orientation |
Profit driver |
Western timeframe |
Description |
|
Relationship/marketing Management |
Building and keeping good customer relations |
1970s To Present |
Emphasis is placed on the whole relationship between suppliers and customers. The aim is to give the best possible attention, customer services and therefore build customer loyalty. |
|
Business Marketing Industrial |
Building and keeping relationships between Organizations |
1990s To Present |
In this context marketing takes place between businesses or organizations. The product focus lies on industrial goods or capital goods than consumer products or end products. A different form of marketing activities like promotion, advertising and communication to the customer is used. |
|
Social Marketing |
Benefit to society |
21st Century |
Similar characteristics as marketing orientation but with the added proviso that there will be a curtailment on any harmful activities to society, in product, production, or selling methods. |
In the consumer-driven approach, consumer wants are the drivers of all strategic marketing decisions. No strategy is pursued until it passes the test of consumer research. Every aspect of a market offering, including the nature of the product itself, is driven by the needs of potential consumers. The starting point is always the consumer. The rationale for this approach is that there is no point spending R&D funds developing products that people will not buy. History attests to many products that were commercial failures in spite of being technological breakthroughs.
A formal approach to this customer-focused marketing is known as SIVA (Solution, Information, Value, Access). This system is basically the four Ps renamed and reworded to provide a customer focus. The SIVA Model provides a demand/customer centric version alternative to the well-known 4Ps supply side model (product, price, place, promotion) of marketing management.
|
Product
|
→ |
Solution |
|
Promotion
|
→ |
Information |
|
Price
|
→ |
Value |
|
Placement |
→ |
Access |
Sales
Sales are a systematic approach to selling a product or service. A growing body of published literature approaches the sales process from the point of view of an engineering discipline.
Reasons for having a well thought-out sales process include seller and buyer risk management, standardized customer interaction in sales, and scalable revenue generation. A major advantage of approaching the subject of sales from a POV "process point of view" is that it offers a host of well-tested design and improvement tools from other successful disciplines and process-oriented industries. In turn, this offers potential for quicker progress. Quality expert Joseph Juran observed, "There should be no reason our familiar principles of quality and process engineering would not work in the sales process”. A sales team's fundamental job is to move a greater number of larger deals through the sales process in the shortest period of time.
Specific steps or stages in a sales process vary from company to company but generally include the following elements:
First Contact---Initial Fit---Sales Lead---Solution Identification---Prospect Qualification
Proposal---Negotiation---Contract
Execution
Mapping a process provides a starting point for further careful analysis and continuous improvement. Diagramming a process flow is considered to be one of the seven basic quality-improvement tools. Elements in the list above (among many others) have been described and/or flowcharted in many published literature. Some examples have primarily focused on functions performed by a sales "department”. At least one cross-functional approach depicts and integrates a variety of interdependent areas, such as sales, marketing, customer service, and operations.
From a supplier point of view, a sales process mediates risk by stage-gating deals based on collection of information or execution of procedures that gate movement to the next step. This controls seller resource expenditure on non-performing deals. Ideally this also prevents buyers from purchasing products they do not need, though such a benefit requires ethical intentions by the seller. Because of the uncertainty of this assurance, buyers often have a buying or purchasing process. The interface between the selling and buying process has also been diagrammed.
A formalized sales process is generally more common for companies that either have complex sales cycles, large revenue risks that require systematic assurance of revenue generation, and/or those that choose to use a more consultative sales approach (e.g. Ford, General Electric, Apple).
An effective sales process can be described through steps that walk a salesperson from meeting the prospect all the way through closing the sale. Often a bad sales experience can be analyzed and shown to have skipped key steps. This is where a good sales process mediates risk for both buyer and seller. A solid sales process also has the dramatic impact of forecasting accuracy and predictability in revenue results.
Operations Management is an area of business concerned with the production of goods and services, and involves the responsibility of ensuring that operations are well-organized in terms of using as little resource as needed, and successful in terms of meeting customer requirements. It is concerned with managing the process that converts inputs (in the forms of materials, labor and energy) into outputs (in the form of goods and services).
An operation traditionally refers to the production of goods and services separately, although the distinction between these two main types of operations is increasingly difficult to formulate, as manufacturers tend to merge product and service offerings. More generally, Operations Management aims to increase the content of value-added activities in any given process. Fundamentally, these value-adding creative activities should be aligned with market opportunity (see Marketing) for optimal enterprise performance.
The U.S. Department of Education, Operations Management [is the field concerned with managing and directing] the physical and/or technical functions of a firm or organization, particularly those relating to development, production, and manufacturing. [Operations Management programs typically include] instruction in principles of general management, manufacturing and production systems, plant management, equipment maintenance management, production control, industrial labor relations and skilled trades supervision, strategic manufacturing policy, systems analysis, productivity analysis and cost control, and materials planning.
Operations management focuses on carefully managing the processes to produce and distribute products and services. Usually, small businesses do not talk about "operations management", but they carry out the activities that management schools typically associate with the phrase "operations management." Major, overall activities often include product creation, development, production and distribution. However product management is usually in regard to one or more closely related product -- that is, a product line. Operations management is in regard to all operations within the organization. Related activities include managing purchases, inventory control, quality control, storage, logistics and evaluations. A great deal of focus is on efficiency and effectiveness of processes. Therefore, operations management often includes substantial measurement and analysis of internal processes. Ultimately, the nature of how operations management is carried out in an organization depends very much on the nature of products or services in the organization, for example, retail, manufacturing, wholesale, etc.
The specific disciplines in all successful Management Operation schemes are:
Procurement (Purchasing) Practices---Management Control---Coordination---Product Management---Service Management
Quality Assurance---Inventory Management---Logistics and Transportation Management---Facilities Management
Configuration Management---Distribution
Summary:
All businesses must adapt the mentality of “cradle to grave” to be successful. To eliminate the “grave” one must have in place within their operations the advocacy of a “continuous improvement” mechanism that enhances the Contribution Margin of their product or service. It is only by this means that when a competitor attacks against your price a business can adjust and remain profitable.
While every MSO is unique to the organization under impact, there are logical steps to take to handle and avoid the confusion of how to act. Business Management Counseling Services can aid your company or organization prior and during this time. We highly recommend a pro-active approach of preparedness, however when a pro-active plan does not exist we can facilitate the least amount of collateral damage to the event.
Business Management Counseling Services-6609 Shelburn Drive-Crestwood, Kentucky 40014
