1. Sales people not understanding the consequences of discounting?
Do they know that a 10% discount on sale price may be a +20% hit on your profit margin? This lack of awareness can be why Finance teams and Sales teams don’t always get on! Once your sales people know the broader picture of business impact, then they will be less likely to have knee jerk reactions to customers and take more considered responses in negotiations.
2. Communication between departments
Fostering good relationships between departments leads to a shared understanding of departmental needs of the people and of the processes. Deciding in isolation based on limited visibility or consideration could have significant impact. If it leads to customer dissatisfaction, a slowdown in performance or repeated tasks; these efficiencies all have a negative impact on your business performance and profitability.
3. Linking sales offering to commercial benefit of the customer
With a deeper understanding of commerciality, your sales teams can build a rounded sales proposal that has clear links to the customers desired value. Many buying decisions now need internal consensus within a business, so for example, selling a new system into IT may need agreement from Finance, HR, Operations or Sales. These people in the decision-making unit need clear supporting metrics.
4. Doing the “extra” stuff that never gets accounted for
You have a service contract with a customer. It includes a number of visits and agreed SLA’s. In a desire to give great customer service you go over and above with all good intentions. That is great, until you realise that you are spending additional time and cost that goes way over the contracted amounts. Doing “favours” is ok as part of good customer service – but keep an eye on it. Whilst being super reactive to your customer, it may mean you lose focus elsewhere in your business.
5. Lack of prioritization
Understanding the commercial needs of your business leads to better decision making and therefore time invested doing the right activities at the right time. Many senior directors and board members know and do this, but does it cascade all the way through your business? Linking decision making to commerciality can save time, money and effort at every level. Imagine if every department within your business was focusing on the right activities at the right time?