GPI 199 – Follow a sales order through your system to find your system’s problems.

To truly understand what your customers must go through to place an order with your firm (various departments), follow any customer order that is called in to your company. In order to find out the problems, track it through every department or if you know ahead of time, follow an order from a customer that you know.

Note every time the order stops, people hesitate, questions arise or no one steps in to push the process. During the entire process, note every sticking point and bottleneck or slowdown that occurs and take corrective measures to speed things up. You may need to redefine procedures, pull supervisors into the fray, redefine job descriptions, reprioritize the main tasks of more than a few position descriptions and yes, possibly terminate one or more people who are simply not interested in supporting this necessary improvement to company policy.

The process exposes problems you must address. You will discover who needs training, where priorities are lacking or unassigned, which positions need to be ‘upgraded’ and those positions that need higher levels of education or industry experience.

Once you are finished, you will be one of the very few people in the company that truly understands the entire process, other than uninterested auditors who sometimes know your system better than anyone, but are not necessarily excited to expose its flaws.

Examples of the steps an order takes at your facility:

Customer considers your firm’s capabilities. The customer may find your firm on the internet, in a trade show or featured on one of those flyers you had made that you thought no one read. Something causes the customer to consider your firm and he decides to try you. This is one aspect that is lost in sales and marketing. “Where did you see us first and what caused you to ultimately call us?” Hardly anyone asks this question in order to understand the success and payoff of various types of advertising and marketing materials. Which one worked and which ones do not work? Which costly marketing dollars spent were effective and which were not?
Customer decides to contact your firm. The customer does one of these things: he either calls your company, emails a request for quote to an employee or distributor or faxes a RFQ (request for quote) to the sales department fax machine or company online help email address. He may or may not actually talk to someone at this point. This is where someone in your firm needs to contact this new potential customer immediately. Show your responsiveness and call him. This is another reason to watch the fax machine, watch your email constantly and even be careful and watch the incoming snail mail. Teach the receptionist to protect all customer inquiries. This all seems pretty evident on the surface, but say it loudly and firmly anyway.
Customer calls your firm. The customer reaches your switchboard, asks for the sales department and is transferred. In certain industries, the firm may require that you answer every telephone call personally if it is known that your buyers expect personal attention. If it is not impossible, why would you not talk to someone who might give you a $25,000 order? This whole process involves training the operator. That person needs to know exactly what to do for a number of situations. What is the next step to take when everyone in the sales department is busy? Who should be called, paged, or personally notified? At what time specifically is it ok to break in on meetings or to knock on closed doors in order to get someone in sales to take an urgent call? Spell these answers out clearly in writing.
Customer gets a ‘live’ voice or a recording machine? When the customer is indeed transferred, does he get a live person or voicemail? How many times is it necessary for him to call back and ask for a sales person? What is your company policy about this and what do you want the operator to do? Did that person offer to page the sales person to try to get him to take the call? Find out and correct any gaps in this policy today. Regardless of what happens, teach your operator to get a number and a name in case the call is lost and vow to return the call to him within 5 or 10 minutes. Prove to the customer that their call is important and follow up.
Customer describes what they want to buy, have made or have serviced. The customer sends a blueprint, written description or a copy of an existing product and asks for a quote for manufacturing more, ordering more, providing a service, etc. At this point, does the customer get to speak to someone live on the telephone? Is there a return call to inform him the print or written instructions have been received and can be read or poses problems or raises question for clarification? If the guy calls back and tells the receptionist that he can’t get anyone to call him back, what does she do at this critical point? Create these procedures, teach each of the parties involved and make it effective right away; your business depends upon it.
The customer bid is forwarded to the estimator/bid dept. Inside sales and estimating figure a cost and send back a quote to the customer. Do the sales personnel actually speak to the customer or do they just send the bid response back via email? It makes a difference and the way it is handled may make or lose the bid. Why? If the company bid is only a small dollar amount from the lowest bid, the customer’s buyer might tip our company off to this trying to favor us. If we do not talk to him, he cannot do this on behalf of our company. If no one speaks to the customer, no one will know the bid situation and thus may lose out on an opportunity. A human voice can be convincing when the customer truly wants another company to bid on its work. Call the customer back and show them you are genuinely interested in the work. Demonstrate to them you want the job. When you do not personalize your response, you are regarded as fat and lazy and just another big company or a poorly run firm and who wants to deal with that? Remember that the time you call may be the day they give you the job after submitting multiple previous bids.
Request customer information for granting credit. The inside sales group at this point will ask the customer to submit either a credit application or simply request credit information that most firms have readily available (i.e. bank contact information, company address, Duns number, addresses, telephone, fax, email addresses and a multitude of credit references with telephone numbers and contact names of those who know this company).
Customer credit established. The sales group at this point asks accounting or your credit department to get this new customer approved for credit terms if possible. This goes with the bid that will go back to the client. Do the people in accounting know how quickly they are to respond? (i.e. one business day, four hours, two weeks, etc.) If they do not, tell them their responsibility. They can file later; tell them you need their participation on granting credit as soon as possible.
Does the company respond in a timely and professional manner? How quickly do you respond? Does the potential customer know how long it will take to get an answer back from your firm? Do you tell him upfront what to expect? Who is responsible for this? What does it tell you if the receptionist states a caller complains he sent in a request for a quote and no one ever called him back and it has now been three days? Ask specifically to see if this ever occurs. Follow up on this gap in your system procedure. You may have to assign a lead in your sales department to capture and log in all requests for quotes (RFQs) in order to see how long they have been sitting without a response from your firm.
Customer decides to place an order with your firm. The client sends a purchase order to your inside sales. What happens after this occurs? Does anyone pay attention to the guy that just hands your company an order? Does he get thanked or does anyone show appreciation from your company? If the answer is no, you have problems within your sales department that need attention now. Someone needs to acknowledge the order and commit to a delivery date if it is not mentioned clearly on the purchase order. Someone also needs to personally say, “Thank you for your order today. We appreciate it!” Remember that this is not done with an email.
Due date established with purchase order. At this point, the customer is fully expecting your firm to ship their order to them by an official due date. This due date changes if the customer changes, falters or alters the order in any way and those changes affect the time schedule. Your firm must tell the customer every time the due date changes in writing and on the telephone with the reason for the delay.
Your firm personally thanks the customer, or does it? Does anyone call and talk to the buyer after he awarded your company a purchase order? Did anyone thank him personally on the telephone? Does anyone know what size potential this job is or if it represents a small piece of a much bigger project? Do we have any idea how large this client can potentially become?
Bid or Quote turns into a sales order – moves to production/ purchasing. Inside sales personnel hand the job to production and purchasing. Inside sales forwards job instructions to plant personnel to produce. Is there any check and balance at this point to ensure the order is complete and the firm is expected to make a minimum required net profit % on the job? Is there a secondary check on the bid?
Material and outside services ordered through purchase orders for this job. Are material or services pinch points for your firm? There are lead times on material or procuring outside services so those purchase orders need to be issued first. Many times nothing can start until material arrives. Purchasing should respond within a standard time deadline. (i.e. One business day, 48 hours, etc.)
Material in, production scheduled. Production schedules machines and purchasing buys material. Either department notifies inside sales when there are known delays that will occur.
Production now projected late. The customer needs to be notified immediately when the given original due date is going to be delayed whether it is the fault of the customer (late delivery of supplied material or blueprints) or the fault of your firm (delayed production). Is this notification done automatically through an email or on the telephone personally? Does someone make sure to get a formal acknowledgment from the customer’s buyer about the shipping delay? A signed acknowledgement is good backup if needed later in court. If nothing signed comes back, you need an email reply or acceptance at a minimum for your audit trail.
Shipping ships parts to customer. If it is the customer’s truck, does the shipping department go out of its way to be helpful to that trucker? If your firm is shipping the order to the customer, does someone call or email in advance to notify the buyer his order is on the way? If that buyer is located in another facility, does anyone notify him of the shipment ahead of time or at least once it has been delivered?
Customer is shorted. Customer receives your shipment, states that his order count is received but the quantity is deficient by one part at this point. What does your inside sales department do when notified a vital shipment is short?
Replacement shortage is produced and shipped to customer at no charge. How does your firm handle production shortages found after shipping? Do your people respond quickly to the customer? Do they have other parts on hand to ship? Do they stay after hours in order to fix problems or to help the customer through a problem?
Billings sends invoice. Your billings department emails, mails or faxes the invoice to the customer. Any or all of these options is up to the customer and what they prefer. Sometimes once the customer gets an invoice in the mail and there is a reported problem, they may call and state there are problems with the shipment. They typically state they cannot pay the invoice since the shipment was short, billed incorrectly, rejected or failed for some other reason. Do your employees know what to do in case of these failures?

Customer will not pay your invoice due to shipment errors, pricing problems, defective products or lousy deficient service. Your billings personnel should immediately notify the sales department of notifications received from companies that refuse to pay invoices due to various failures. Someone in sales needs to attempt to resolve this problem with the customer in order to get the company paid on the questionable shipped parts. All of the negotiations with outside customers need to stem from sales personnel and not from any other department.

Customer unable to pay bill. Sometimes the customer does not have the money to pay the bill. At this point, credit personnel attempt to get a payment plan put into place and mutually agreed upon. Your firm should be on the telephone with the customer constantly in order to get some reimbursement from the unpaid invoices up until those invoices are finally handed over to your internal lawyer (demand letter) and then given to an outside collection firm which will take legal action applicable to your state and municipality laws along with a hefty percentage of the eventual payment extracted by the court. (i.e. 25 to 50%, depending upon age of invoice).