The Role of Sales and Marketing in Planning and Scheduling
| DOI | https://doi.org/10.1108/eb057485 |
| Date | 01 July 1987 |
| Pages | 20-24 |
| Published date | 01 July 1987 |
| Author | John R. Dougherty,Christopher Gray |
| Subject Matter | Economics,Information & knowledge management,Management science & operations |
The Role of
Sales and
Marketing
in Planning
and Scheduling
by John R. Dougherty
and Christopher Gray
The Oliver Wight Companies
Objective
A manufacturing or distribution company can get the most
out of its planning and scheduling system only if all company
functions are actively involved. Sales and marketing is a key
function whose participation is often hard to enlist. This
article will describe the accountabilities and activities
required of sales and marketing to optimise the benefits of
a planning and scheduling system. It will also highlight the
benefits and advantages that such a participation will
produce for sales and marketing, and the customer.
Perspective
MRP II, Distribution Resource Planning (DRP) and Just-In-
Time (JIT) implementations are often viewed narrowly (and
sometimes negatively) by sales and marketing. They are
seen as inventory and cost reduction programmes which
may endanger customer service and flexibility in the market-
place.
Sales and marketing must not only understand that
such systems will improve performance to the customer,
but also, by their active participation, must contribute to and
ensure this improvement.
The late Oliver Wight developed a checklist and grading
system whereby companies could compare their
performance to industry-wide standards. This is called the
MRP II ABCD Checklist. Class A results represent the
pinnacle of success.
The results of a survey of 1,100 companies concerning their
experience with MRP II is published in the Oliver Wight
Companies' 1985 newsletter. That survey showed that 85
per cent of the companies enjoyed better performance with
an MRP II system. Eighty per cent of the companies that
consider themselves Class A said that performance was
enormously better. The companies surveyed averaged a 16
per cent improvement in customer service, while the Class
A companies averaged 28 per cent. Ninety-eight per cent
of the Class A companies estimated their yearly benefits
from MRP II to be oyer $100,000. Forty per cent estimated
these benefits to be over $1 million per year. Sixty-five per
cent of the Class A companies enjoyed improved market
share.
Ninety-seven per cent of them indicated they had
better planning/simulation tools to deal with market
opportunities. Ninety-nine per cent felt they had better
control of their business. The Class A companies had a
weighted average of over 200 per cent return-on-investment
from implementing MRP II.
Many individual companies which have achieved Class A
benefits indicate that improved customer service, lower
competitive lead times and increased flexibility to the
market-place have allowed them to capture additional
business, increased sales levels and improved market share.
In summary, excellent performance in the area of planning
and scheduling has become a powerful, competitive
weapon for these companies in servicing their market-
places.
Certainly, any sales and marketing executive would be
excited to achieve such benefits. Believing that they could
be achieved in one's own company requires a thorough
understanding of the mechanics of an improved planning
and scheduling process. Part of this understanding is an
exact realisation of the role that the Marketing Department
needs to play in the justification, implementation and
operation of such a process.
The examples cited above apply specifically to MRP II. The
experiences are similar for companies that have additionally
implemented DRP and JIT. The specific discussions that
follow are based on a typical MRP II implementation, which
generally has been a prerequisite in a manufacturing
company for DRP and JIT. But the specific framework and
suggestions that follow would apply equally well for a DRP
or JIT implementation. This discussion will focus on four
key areas: business planning, sales and operations planning,
demand management and master production scheduling.
Business (Strategic) Planning
This is a function in which sales and marketing executives
traditionally take a strong leadership role. However, the
process itself, and the attitudes surrounding it, too often
take manufacturing (planning and scheduling) as a given;
that is, it is assumed that for whatever strategies are
developed,
manufacturing can easily, effectively and
profitably mobilise resources to support them. In the short
to intermediate term (one to five years), this is hardly ever
true.
20 IMDS • JULY/AUGUST • 1987
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