Core Business Processes - Sell Products

Description

This process manages the entity’s customers and the interaction with them.

Sub Process Components

Account Management

Process Objectives

1. Maximise profitable sales
2. Ensure all sales opportunities are realised
3. Maintain appropriate in-store presence
4. Seek collaborative development opportunities
5. Establish points of differentiation vs competitors

Critical Success Factors (CSF’s)

1. Quality of account sales managers (1,2,3)
2. Acceptance of trade programmes (1,3,4)
3. Clear understanding of customers current needs and   future strategy (1,3,5)

Key Performance Indicators (KPI’s) Linked to CSF’s

• Net sales per salesperson; customer profitability (A)
• Trade promotion spending (B)
• Customer satisfaction survey results (C)

Inputs

Understanding account strategies Customer profitability Advertising and promotion plans

Customer service objectives Marketing plan Trading terms Trade marketing plans

New product development strategy Competitor research Market research Distribution objectives

Activities

Outputs

Investment priorities Agreed account budget in terms of sales and profit

Promotion plan

Strong business relationship

Systems

Decision support systems Executive information system

Budget planning system

Customer databases

Classes of Transactions

Routine

Non-Routine

Accounting Estimates

Risks Which Threaten Objectives

1. Poor communication with customers (2,4)
2. Rejection of trade programmes (2,3,4)
3. Better perception of competitors by customer (5)
4. Poor customer service (1,2)
5. Unwillingness to pursue alliances (4)
6. Lack of gross profit by customer/product line information (1)

Management Responses Linked to Risks

• Regular feedback from customers (A,D)
• Comprehensive category and market analysis (B,E)
• Monitoring of competitors trade programmes (C)
• Maintain strong customer service department (D)
• Providing gross profit by customer/product line
• Information to account sales managers (F)

Other Symptoms of Poor Performance

Account managers have no responsibility for profit

No central coordination of account managers

Large number of credit queries

Performance Improvement Observations

Sales force automation “Best practice" promotions

Category management Customer / competitive analysis

Analysis of trade programme performance Cost-to-service analysis

Customer Order Management

Process Objectives

1. Communicate product demand to distribution
2. Establish warehouse, transport, invoice cycle
3. Confirm price and delivery terms

Critical Success Factors (CSF’s)

1. Efficient and accurate entry of customer orders into system (1)
2. Accurate product pricing, promotions database (3)
3. Efficient communications links in responding to customer issues (1,3)
4. Effective, integrated IT system that is easily understood executed by employees (2)

Key Performance Indicators (KPI’s) Linked to CSF’s

• Percentage of orders accepted via EDI; customer order error rate (A,D)
• Number of deductions, credit notes (B)
• Number of unresolved customer issues (C)
• Order to delivery time (D)

Inputs

Finished goods availability Distribution schedules

Customer order Customer details (delivery address, credit limits, etc.)

Pricing and terms detail

Activities

Outputs

Order picking details for distribution

Invoice to customer

Sales order statistics

Classes of Transactions

Routine Sell products Invoicing customers Receive payments Accrual of rebates

Non-Routine Unusual collection problems Sales of accounts receivable

Accounting Estimates Reserve for bad debts Reserve for product returns

Risks Which Threaten Objectives

1. Inaccurate order entry (1)
2. Poor internal communication (1,2)
3. High level of deductions; unresolved customer order / invoice issues (3)

Management Responses Linked to Risks

• Efficient order entry procedures (for example, EDI) (A)
• Use of integrated systems for order management (order entry, inventory management, logistics / transportation) (B)
• Simplified pricing / promotion policies; single point of contact for customer regardless of issue (C)

Other Symptoms of Poor Performance

High activity levels involved in sales order processing

Long time-span between receipt of customer order and dispatch

Performance Improvement Observations

Sales force automation Activity-based costing (cost-to-serve analysis)

Business process re-engineering Foreign sales corporation tax planning

Enterprise package software implementation