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What Sales Can Learn From Lean Manufacturing

by David Brock on June 1st, 2017

There a number of people with views that sales can learn a lot from manufacturing and applying lean and agile manufacturing methods to the sales function.  I tend to agree, a lot of the underpinnings of great manufacturing have great applicability to selling.  At the same time, there are some real limitations, which we can’t be naive about in applying manufacturing techniques where they don’t fit  (Read my “Customers Are Not Widgets,” and related posts.

Perhaps the foundation for much of today’s modern manufacturing thinking is the Toyota Production System.  It was Toyota’s approach to manufacturing developed over decades under the leadership of Sakichi Toyoda, Kiichiro Toyoda, and Taiichi Ohno.

The Toyota Production System is quite comprehensive and we can apply many of its lessons to other aspects of business.  I’ll be writing a series of posts on different aspects of what we can apply and the limitations of this approach to selling.  But if you are a real student of this thinking, you will want to pick up a copy of The Toyota Way Fieldbook by Liker and Meier.  It’s probably one of the clearest descriptions of the principles I’ve discovered.

At the core of the Toyota Production System are the “4P’s.”  Underlying the 4Ps are 14 principles.  Together, they provide the foundation for everything we look at in applying these approaches within sales.

The “4Ps” are:

  1. Philosophy as the Foundation.
  2. The Right Process Will Produce The Right Results.
  3. Add Value To The Organization By Developing Your People And Partners.
  4. Continuously Solving Root Problems Drives Organizational Learning.

You’re probably thinking, “This doesn’t sound much like Lean Manufacturing, it sounds like good basic business principles.”  One of the things you discover about the Toyota Production System (TPS) is that it is really great business principles applied to certain processes and problems (all manufacturing).

The beauty is, these “4Ps” are fundamental to creating high performing sales and marketing organizations!

Philosophy as the foundation:  Toyota’s founders had a long view of the business.  Their thinking was to build a business that would last centuries.  To do this, there had to be an underlying philosophy about the business.  The fundamental questions are:  What do we want to stand for?  To our customers? Community? Society? People?  How do we add value to each of those?

Where many organizations tend to look at what they do, TPS starts at a different place.  As a result, what Toyota manufactures and does becomes a vehicle for how they add value to their constituencies.

In applying this to sales, we need to be thinking the same things, “Who are our customers?  How do we value them?  How do we create value for them?”  What experience do we want to create through their entire journey (before they buy, buying, implementation, etc.).  If we don’t have a clear idea of this philosophy, we can’t make the decisions that enable us to implement the philosophy through our organization to the customers.

The right process will produce the right results:  We always think of manufacturing as a very disciplined process focused function.  No one would ever question the need for the process focus, process engineering in manufacturing.

But the same principles apply in sales!

Somehow, however, we don’t tend to think of process in the same way that TPS does or that manufacturing execs do.  We don’t look at our selling process, we don’t execute it, we don’t constantly seek to improve it.  But we know the lessons–the right process will produce the right results.  How can we ever expect to drive sustained performance if we don’t have a process that’s based on the things we do consistently to produce the right results.

While the sales process—how we align ourselves with the customer’s buying process, maximizing our ability to win is fundamental, we have any number of ancillary processes when we think about the entire sales function.  What’s our recruiting, hiring, onboarding process to make sure we get the right talent off to the best start possible?  What are the workflow we engage in within our organization and with our customers?

In TPS there is a huge focus on understanding and executing the right processes consistently, constantly improving and simplifying our processes.  There are huge gains in sales and marketing effectiveness by leveraging these lessons–simply put, do what works consistently, stop doing what doesn’t work.

Add value to the organization by developing people and partners:  Ironically, for excellence, where one things of huge opportunities for automation, TPS recognizes one of the most important element for success are the people and partners (in this case, suppliers, as well as downstream partners).  TPS recognizes that it’s through these people thinking, learning and growing, that they have the best opportunity to continually refine and improve manufacturing performance.  It’s these people that will identify problems and opportunities.  Properly empowered and supported, it’s these people that are best able to develop solutions to address these.

It’s ironic that in sales, traditionally a “people” focused function, we have lost sight of the importance recruiting, onboarding, training, coaching and developing people.  Many sales improvement efforts take as “given” that the majority of sales people are mediocre, implementing systems and tools to eliminate them or to compensate for their mediocrity.  We also see a “disposable” mentality around people.  Often, we hire them, throw them into a territory, if they don’t hit their numbers, fire them, replacing them with the next person.

TPS has us rethink our people and talent management processes.  We need to invest in them, develop them, coach, them, helping them achieve the highest levels of performance.  In turn we need to have high expectations of that performance and of their ability to help us continually improve.

Continually solving root problems drives organizational learning:  TPS is founded on the concepts of continuous learning and continuous improvement.  Inherent in this approach is a disciplined approach to identifying problems and opportunities, understanding them deeply, and addressing them.  TPS recognizes that we will continually be facing problems and challenges and must continually find solutions.  However, it would be considered “waste” in TPS to constantly solve the same problem over and over.  Using TPS principles, we seek to understand the root causes and root problems, addressing those and eliminating their recurrence.

Too often, in sales and marketing we have a “ready, fire, aim” approach.  We tend to react to signals/symptoms rather than trying to understand them and get at the root issues.  This tendency adversely impacts our ability to create value for our customers since what they are really interested in is help in solving their problems.  It also adversely impacts our own internal operations, efficiency, and effectiveness.

 

When we look at the foundational principles of TPS, we realize they have little to do with efficient manufacturing practice.  They are about great business management.  These principles apply equally to every function in the organization.  How we address them may differ by function–I’ll be exploring this in the next several posts.

In the next post we will begin to look at the 14 principles that are driven by the 4Ps.  As a preview, these are:

Philosophy as the foundation:

Principle 1:  Base your management decisions on a long term philosophy, even at the expense of short-term financial goals.

The right process will produce the right results:

Principle 2:  Create a continuous process flow to bring problems to the surface.

Principle 3:  Use “pull” systems to avoid overproduction.

Principle 4:  Level out the workload.

Principle 5:  Build a culture of stopping to fix problems, to get quality right the first time.

Principle 6:  Standardized tasks and processes are the foundation for continuous improvement and employee empowerment.

Principle 7:  Use visual control so no problems are hidden.

Principle 8:  Use only reliable, thoroughly tested technology that serves your people and processes.

Add value to the organization by developing your people.

Principle 9:  Grow leaders who thoroughly understand the work, live the philosophy, and teach it to others.

Principle 10:  Develop exceptional people and teams who follow your company’s philosophy.

Principle 11:  Respect your extended network of partners and suppliers by challenging them and helping them improve.

Continuously solving root problems drives organizational learning.

Principle 12:  Go and see for yourself to thoroughly understand the situation.

Principle 13:  Make decisions slowly by consensus, thoroughly considering all options.  Implement decisions rapidly.

Principle 14:  Become a learning organization through relentless reflection and continuous improvement.

 Book CoverFor a free peek at Sales Manager Survival Guide, click the picture or link.  You’ll get the Table of Contents, Foreword, and 2 free Chapters.  Free Sample

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