Need for Selling-Chain Management

Several fundamental market issues are driving the interest in selling-chain applications: the rise of self-service, the excessive cost of presales support, the increasing cost of order errors, changing sales channels, increasing product complexity, and the rise of mergers and acquisitions.

The rise of the self-service Order

The sales process is getting increasingly complex as customers demand higher levels of service, faster turnaround times, and more customization. The early 1990s brought the concept of mass customization to the marketplace, which has evolved to serve a “market of one”. Consumers want what they want, when they want it, and they want is packaged uniquely to meet their individual needs. In this new market, companies need to reexamine their sales procedures for ease of use. For years, Citibank captured a significant share of the college student market for credit cards simply by making it easy for students to obtain credit, while competitors made it difficult.

The Excessive Cost of Presales Technical Support

The effective translation of prospect needs into product specifications results in the increased use of technical sales specialists during the presale phase of a sales process. Generally, technical sales specialists have a superior grasp of the capabilities of the entire product line and a better understanding of how these capabilities may meet a prospective customer’s needs.

While effective, using technical support drives up the cost of selling and shifts the burden of expertise from the salesperson to the technical sales specialist. The result: excessive time consumed preparing complex sales quotes and proposals. As the pace of business accelerates and consumers expect shorter response times, it’s imperative that companies deliver accurate and thorough sales proposals in record time.

The Increasing Cost of Order Errors

The increased sophistication of custom products, services, and systems has resulted in an overall increase in the cost and frequency of order errors, which occur throughout the sales-and-delivery cycle. At the point of sale, an error can be made by simply proposing a product configuration that does not actually meet a customer’s technical requirements or by offering a product that can’t be manufactured.

Errors occur in order entry because incompatible options are not rejected or ancillary equipment has not been included in the order. In manufacturing, an invalid configuration can shut down the production line. If a miscalculated, multi-vendor product configuration is actually shipped to a customer, the cost of correcting the mistake in the field can be excessive, if not irrecoverable.

The Increasing Channel Proliferation Problem

Selling is not as simple as it used to be, due to the rapid proliferation of channels.

The channel applications that serve the order acquisition side are manifold:

  • Field sales and in-store/branch sales: assisted in-person selling

  • Telesales: assisted call-center selling

  • Self-service: unassisted selling via the Web

  • Third-party resellers or channel selling

The relative success of direct-to-the-end-user and build-to-order models are beginning to put pressure on companies to improve the information flow through various sales channels in order to improve time to market, reduce costs, and compete more effectively.

The Increasing Complexity of Products

The increasing complexity of products and the rise in customers’ demands for time-efficient ordering processes have put pressure on companies to increase the productivity and responsiveness of their sales force. Furthermore, the pace of introducing new products has accelerated dramatically, causing shorter product life cycles, which makes the salesperson’s job of staying current even more difficult.

Sales efficiency and productivity remain major issues in many industries that are experiencing tight labor markets for seasoned sales professionals. The sales force must become adept at dealing with an ever-growing, even-changing set of products (and/or services) as companies seek to broaden their product portfolios to sustain or accelerate growth rates.

The Rise of Deregulation, Mergers, and Acquisitions

While some organizations may face new sales and marketing challenges due to new channels and product line expansions, others face dramatic changes within their industries, such as the impact of deregulation on both the telecommunications and utility industries. Until now, companies in these industries haven’t had to worry about having efficient and effective sales and marketing departments because they’ve enjoyed a monopoly. Now that they must compete, many of these companies are rapidly adopting selling-chain applications, not only to improve service, but to survive

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