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Customer Relationship Manufacturing: the Symbiosis of Sales and Manufacturing

Written By: Gabriel Gheorghiu
Published On: July 6 2009

The departments within a company are like the children in a family: the owner, chief executive officer (CEO), or any other decision maker in the company, has a favorite department—in somewhat the same way that parents tend to have a favorite child. Not having children of my own, I did some research on the topic and found this very interesting article on a study about the burying beetle (Nicrophorus vespilloides), an insect that seems to have a family structure that is very similar to ours.

Another study from Temple University shows that “even a child who feels its parents may have favored one sibling over another will still be generally content later in life.” I thought children were supposed to be more than “content” later in life; but again, I have no children, so what do I know?

In a manufacturing company, the two favorite children (i.e., departments) are sales—because they make money—and production, because sales cannot make money without them. The parents (owner, CEO, etc.) usually have only one favorite, depending on their professional backgrounds, personal reasons, etc.

Still, in the same way parents admit that having a favorite child should be avoided, a wise decision maker in a manufacturing company will know that having a favorite department is not good for the business, mainly because it will create non-constructive competition between departments, which affects productivity.

Why Do They Need to Work Together?


Harmony, peace, well-being, and a positive work environment? Yes, those are good reasons too; but in the end, it comes down to the fact that the two departments are more efficient when working in tandem, therefore making the company more profitable.

Close cooperation between departments—especially between production and sales in manufacturing—can be a very important competitive advantage. It is especially true for small to medium businesses (SMBs), for which the competition is tougher. SMBs today need to be very flexible and to easily adapt to the fast-changing market—which is very hard to do when you have internal competition between departments. Here are three reasons why sales and production  should get over their sibling rivalry.

1. Manufacturing companies must address shifting customer needs. This is done mostly by understanding those needs and how they evolve. This process cannot be fulfilled by either of the two departments alone. Production needs constant feedback from sales on the quality of the products, market trends, etc. And sales needs to know how production can adapt to new demands and how those changes will impact the company.

2. They can both improve each other’s activities. Sales can sell more by knowing how products are made; production can make more and know more about what customers really need. Both departments can provide vital information for one another. Sales and customer service can gather data about defects, returns, and many other types of problems, which can then be used by production to improve quality. On the other hand, production can share its knowledge on how to address these problems, which will benefit the customer care team when speaking to customers.

3. Inefficient collaboration between production and sales can affect other departments. Think about distribution or warehouse management. If production is making too many finished goods and sales cannot sell them, those goods will probably have to be stored in the warehouse for weeks, maybe even months—which means extra costs. Purchasing can also be affected if production does not know which raw materials are needed and in what quantities because sales cannot tell production how much to produce.

How to Make Them Work Together?


What you should NOT DO is tell both of them they’re your favorite child (department), as the woman who wrote this article did. Having a favorite will probably happen anyway, but you should act as if there were no difference. This way, neither team will have an advantage over the other, which will help avoid frustration, poor communication, bad- mouthing of each other, etc.

Probably the most important thing to do is define workflows that include both departments. This should create a continuous exchange of information between production and sales. Knowledge bases created and maintained for products and customers, with well-structured data and well-defined analytical processes, should be available to both departments as a common source of know-how.

Something else you could try is to make departments switch places regularly, for a short period of time. Have one of your sales people work in production for a few hours and vice versa. Getting to know exactly what the others do—and how they do it—will help them understand and accept the others better. Just make sure they don’t end up like Mark Twain’s prince and pauper!

Have regular meetings with both teams, together. Each team will be aware of the problems the other team is facing, which will make it easier to convince them to help. Also, this will make them all feel like a part of the same team—which is precisely what a company should be.

Assign common objectives to both teams. This way, no one will have reasons to say that they tried but the others weren’t ready or did not listen. Responsibilities, as well as rewards, should be equally shared between the two teams (which should really work as one).

On the technical side, an integrated business solution or suite should be used by both departments. This will allow collaboration and sharing, as well as definition and implementation of workflows, which will make everyone’s work easier and ultimately more efficient.

How Do You Differentiate between Regular CRM and Manufacturing CRM?

There are vendors who offer a special kind of customer relationship management (CRM), called CRM for manufacturing. Some of them are: Empower CRM, Pivotal CRM, Infor CRM, Microsoft Dynamics CRM, Sage CRM, and Plex. As you probably noticed, most, if not all, of them also offer enterprise resource planning (ERP) products.

At a first glance, CRM for manufacturing does not look so different from regular CRM offered by vendors concentrating on this type of product only. So, the question is: does a manufacturing company really need a CRM for manufacturing or can any CRM solution be used?

I will try to answer this question in a future blog, where I will shed some light on how CRM for manufacturing is different from regular CRM. In the meantime, we welcome your comments, preferably on CRM and manufacturing, but feel free to give us your thoughts about family structure and children as well.
 
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