The first three trends have focused on how workforce changes are making discrete
product sales more challenging. The next two focus on how changes in product complexity
and the overall size of the opportunity will put even more pressure on discrete manufacturers’
sales operations.
4. Discrete product lines are expanding and becoming more complex. Many discrete
manufacturers are expanding the number of products they offer and the complexity of their
individual products on an ongoing basis. It’s part of a strategy to add more features and
options to individual products so they’ll address a wider range of business problems.
In addition, many discrete manufacturers are expanding product lines through innovation,
and merger and acquisitions.
5. The overall discrete manufacturing industry is growing. US Census Department data
shows that sales of discrete products increased from $1.4 trillion in 2002 to more than
$2 trillion in 2013.4 While it’s heartening that the market has more than recovered from the
manufacturing downturn in the recession of 2008 and 2009, the decline in the number of
experienced sales professionals with adequate support resources makes pursuing this
expanded opportunity difficult.
Meet the challenge by creating leverage
This perfect storm of expanding opportunity and shrinking available resources to pursue it
demands a response. In our view, executives at discrete manufacturers have three possible
options, only one of which offers a promising way to win more sales with fewer sales
resources. The three options are:
Live within the constraints. This entails limiting your sales objectives by curtailing product
innovation and expansion, and accepting that new sales reps will be unable to maintain the
same volume as their predecessors. Essentially this would be forsaking the opportunity to
increase revenue and grow the business. In the worst-case scenario, it could mean the
demise of your company, as competitors adapt more effectively and win business that was
once yours.
Adopt or improve upon traditional strategies. There are several well-established strategies
for improving discrete product sales. Companies can invest in more powerful customer
relationship management (CRM) solutions to more efficiently manage their current sales
processes. Although a CRM solution can provide better visibility into the sales pipeline
and a more accurate forecast the solution, by itself, won’t deliver specific capabilities to
increase sales.
Manufacturers can attempt to make up for a shortage of internal sales resources by
expanding their network of dealers and indirect sales reps. But this can be problematic
because the national wholesale sales force is declining more precipitously than the direct
sales staffs, a trend illustrated by US Census data. According to US Census data, by 2011 the
size of the US wholesale sales force had fallen to 170,000 from a peak of nearly 290,000 in
the middle of that last decade.5
4 U.S. Department of Commerce, U. S. Census Bureau, “Time Series / Trends–Manufacturers’ Shipments, Inventories, and
Orders – Durable Goods Excluding Transportation – New Orders – U. S. Total”.
5 Steven Ruggles, J. Trent Alexander, Katie Genadek, Ronald Goeken, Matthew B. Schroeder, and Matthew Sobek. Integrated
Public Use Microdata Series: Version 5.0 [Machine-readable database]. Minneapolis: University of Minnesota, 2010.
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Investing in more sales training is another tried and true approach that won’t meet the current
needs of discrete sales executives. For Millennials who typically stay at a job for three years,
compared to an average of 11 years for older workers, training can be a poor investment.
In “Boiling Point? The skills gap in U.S. manufacturing,” a 2011 report sponsored by Deloitte
LLP and The Manufacturing Institute, the authors warn manufacturers against investing heavily
in training:
Clearly, many manufacturers are investing in training programs. But the evidence
suggests that these programs are falling short of their goals. Two-thirds of the
respondents said they’re relying on overtime, while nearly half used third-party
labor to close the skill gaps. These methods are costly, inefficient, and can add up
to a big drag on overall performance. The responses to this question are
remarkably consistent across industry groups, indicating a need across the board
to embrace more analytical and innovative means of dealing with skills gaps.6
Create leverage to accomplish more with less. Discrete product companies can overcome
the “do more with less” sales challenge by acting strategically to better leverage people,
technology, and processes.
The manufacturing skills gap study by Deloitte LLP and The Manufacturing Institute
recommends this approach as the best way to mitigate the manufacturing skills shortage.
“Knowledge management plans and solutions can address the brain drain as older workers
retire, taking with them valuable knowledge and experience. Capturing critical information
through technology and passing it on to newer and younger workers can help reduce training
time, can improve collaboration and communication, and even help companies get to market
faster by leveraging previous programs.”7
Here are four strategic initiatives that can help discrete product sales executives create
leverage and transform their sales operations to meet the business challenges of the future.
1. Systematize knowledge transfer. Go beyond traditional training techniques and use
technology to systematically transition knowledge from experienced to inexperienced sales
reps and across your entire sales chain. Automate documentation processes to help
everyone in the sales chain—including your dealers—easily get the information they need.
In an April 2013 research report, Aberdeen Group recommends implementing improved sales
content management systems. “Often referred to as the ‘sales enablement’ process, these
technologies—and the key protocols that support them—allow corporate marketers to
provide content options for sellers to use in the field. In the most successful deployments,
individual sales reps and account managers have access not only to an easily searchable
set of assets, collateral, documents, proposals templates and RFP (request for proposal)
response tools, but also the ability to configure their messaging around each specific
customer’s needs.”8
2. Institutionalize policies. Use a new strategy that ensures compliance with pricing and
margin policies early in the sales process. Build the policies directly into the sales quoting
system so that as reps create customer quotes, the system continually guides the rep to offer
product choices that optimize financial aspects of the deal. This also will reduce delays while
customers wait for workflow processes to be completed before they receive their quote.
6 Tom Morrison, National Service Line Leader, Deloitte, LLP; Bob Maciejewski, Senior Manager; Deloitte LLP; Craig Giggi, Vice
Chairman, Deloitte LLP; Emily Stover DeRocco, President, The Manufacturing Institute; Jennifer McNelly, Senior Vice President, The Manufacturing Institute; Gardner Carrick, Senior Director, The Manufacturing Institute, “Boiling point? The skills gap
in U.S. manufacturing.” 2011, Page 5.
7 Ibid. Page 11.
8 Peter Ostrow, vice president and research group director, “Breaking the Laws of Physics: Shortening the Last Sales Mile
through Workflow Automation,” Aberdeen Group. April 2013. Page 3.
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