Next month I am participating in a Lean Sales & Marketing event in Indianapolis and, as I start the preparation process, I thought I might share a couple of points I plan to raise guaranteed to raise the blood pressure of a lot of folks. The first of them is the particularly inane practice of using third party manufacturer’s reps. It is hard to imagine how anyone thinks outsourcing the link between a company and its customers is a good idea.
When the objective is to maximize customer value, playing a circle game with customers to garble the message about what customers actually value – extending the communications chain between you and them – hardly seems like an effective approach. Having the link be someone who views optimizing your business as a part-time, short term goal make even less sense. And having that link compensated solely on volume – and not at all on value – is worst of all.
Not much better is having your own sales force, but having all communications with the customers flow through them. The idea is to have direct communication between yourself and the customer at every level possible, your engineers to theirs, your receivables person with their payables person, the folks on your shipping dock with the people receiving your shipments. Having your sales person as a communications bottleneck is hardly conducive to engaging your whole company in the value creation effort. Flip it around and ask yourself, if all your suppliers know about you is what your buyer tell their sales person, what are the chances of anyone at their company coming up with an idea that is really going to improve you?
All of this falls under the umbrella Lou Pritchett had in mind when he said, “The primary job of sales is to represent the customer to the company, not the other way around.” Pritchett, for those unfamiliar with him, was a legendary sales leader at P&G during the heady days when they were cranking out high value, innovative stuff – a far cry from today’s P&G that talks to customers rather than listens to them. Creating value for customers requires knowing what they place value on, and that isn’t going to happen with a bunch of third party contractors, communications bottlenecks, or anyone who gets paid on commission.
John Buzolic says
It is the big box retailers that dictate supplier consolidation. I think you should be delivering this message to a purchasing conference instead.