5 Tips for Getting Sales & Operation Planning Teams to Work Together

EXECUTIVE SUMMARY | When Sales, Marketing, Finance, and Operations come together in a Demand Planning meeting, tensions develop. To avoid this, invite only Sales and Operations because it is the Sales team that has the relevant market insight, and the Operations team has the information about production needs. The author also suggests that for forecasting, give the most emphasis to products that are high in value and difficult to forecast; and for the rest, use an expert system that automatically selects the best model for forecasting.In the world of Operations, we want our businesses to run like a car assembly plant-people and tools are united in an efficient and gracious manner. The reality, however, is very different. This is due to the fact that each team in the department is a tribe-a community with its own culture, its own ways of thinking, and its own objectives. These differences come to light at the heart of the planning process, when Sales, Finance, Marketing, and Operations teams come together to forecast the demand and supply of products and services. Too often, I have witnessed consensus forecasting meetings turn into chaos, with each tribe trying to achieve its own high-priority objectives.It is 9:00 AM and the planning meeting begins. Finance is keen on minimizing stock holding over the course of the year to pay off the debt related to a recent acquisition. Sales want to make sure they can deliver on the commitments to their key accounts. Marketing is trying to push Sales into committing support for the New Products that are behind on KPIs. And Operations is keen to go through the mix of products and services to ensure that all market insights from the Sales and Marketing teams are quantified and captured in the forecasts.Before you know it, the temperature in the room is rising. The Sales team is increasingly winning the share of voice, the lines between Marketing's insight and wishlist demands are blurring, and Operations has started entering into the system the forecast numbers shouted at them just to get through the item list. By 3:00 PM, we have covered 129 SKUs and have another 288 to go through before the end of the day. By that time, everyone is feeling drained and dreading the next forecasting meeting.All the relevant knowledge and expertise was in the room, but collaboration was not. The good news is this: we can do better. Here are my five tips for getting Sales and Operation teams to work harmoniously.1. Stick to Forecasting. Having so many tribes in the same room is the first trap we fell into. Marketing strategy decisions, Finance's cash flow tactics, and ring-fencing resources to specific customers all need to be done, but they can be done elsewhere. You have the statistical forecast; all you really need is he key market insight to make adjustments. That means only Sales and Operations are to be allowed in the room. Better still, try to get a Sales Champion who can gather and summarize this intelligence from each member of the Sales team. That way, it's only the Sales Champion and the Operations guy in the room, keeping the discussion close to its purpose, even it means arranging a separate meeting later that week.2. Manage by Exception. Members of the Sales team know they need the demand forecast to be accurate in order to keep the key accounts supplied, but they don't care about each and every product line or service offering, especially if their customer doesn't buy it. …