Recently, I witnessed an intense Grand Slam match of blame tennis recently in the board room of a popular FMCG multinational. The intensity and aggression on display presented a mental image of a tennis match with John McEnroe, Ilie Nastase, Goran Ivanisevic and Nick Kyrgios all on court at the same time. Each player competing against three opponents in multiple, parallel games. Can you imagine the debris from all those broken racquets, chairs and egos? There would certainly be an abundance of multi-lingual blueness in the air along with some badly bruised balls.

The CEO blamed the Sales Director for not meeting the targets so Sales sent a blame diverting back-hand into the ribs of the Supply Chain Director who then immediately returned with a solid smash only for Sales to produce an unexpected drop shot that completely caught out the Finance Director. What a waste of senior level time and energy and frankly, shame on the CEO for publicly starting the interchange as she/he should have been much better informed. What is more, the S&OP process was clearly not in great health.

 

 

As ever, the reasons for not meeting sales targets are numerous and seldom are such failures attributable to one individual department or team. Sales can only sell what is available and blips can occur anywhere along the extended chain. Certainly, no S&OP process is perfect as humans are involved so errors will happen but they must not be swept under the carpet or massaged. Throughout the process people need to be brave and very open about why errors occur and seek to apply '100 year fixes' for the company benefit, not for their department.

Work together to identify the real causes of lost, missed or reversed sales. Do not rely on hearsay or history as you cannot cure what you cannot clearly see. Agree a policy that identifies the exact source for all lost sales or returns from clients and then you can drill down and apply those fixes. NB. the objective is NOT to be able to allocate blame!

Why we lose or miss sales can be due to many reasons including some which may be unexpected. These lists are not exclusive but provide an indication of potential sources, many of which can be cured with rigorous contracts and SLAs - internal and external.

 

Supply Chain

• Wrong shipments, e.g. sent to the incorrect client or store
• Shipment rejected due to missed delivery time slot
• Damaged on receipt
• Picking errors, missing goods
• Picking errors, expired/close to expire goods and rejected
• Documentation errors leading to rejection
• Old product supplied after relaunch

Finance

• Credit control errors
• Cash flow constraints

RtM

• Expired goods in Key Accounts
• Expired goods in Traditional Trade
• Valid order rejected on receipt at client
• Damaged at client
• Overstock at client 
• Stock returned by client prior to a relaunch or promotion,
• Post relaunch returns
• Failed promotion returns
• Slow moving stock returned by client
• Insufficient stock instore to meet consumer demand
• Stock not merchandised on shelf and lost/hidden in stock room
• Incorrect pricing

Stock in store but not listed at head office and will not scan at checkout

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