Category Archives: Support

Sales, Operations and Support

Sales and Operations. It seems pretty simple to me. One group is responsible for selling the product or service, and the other group is responsible for delivering and implementing it. Again, it seems pretty black and white. Dogs and cats, men and women, etc. etc. If you are not one, then you should be the other.

I have often said that there are two types of people in the world. Those that divide people into two types, and those that don’t. However, I have digressed a little here.

What I am getting at here is that in business, in today’s world, you need to look at your role and understand on which side of the Sales and Operations divide you are on. You need to understand if your focus is on the top line – Sales, or on the bottom line – Operations.

I suppose that this division can be extended into the support functions as well. Financial teams can be keeping score of the sales and the gross margins associated with those sales, or they can be keeping score of the costs of the product, delivery and implementation, and the earnings that are generated. Marketing is primarily a Sales related function since its primary role is to position and enable sales to customers. I think you can look at just about every role within an organization and understand where it sits within the Sales and Operations split.

A major difference between Sales and Operations is that at least part of the Sales team’s compensation is based on how much they sell. This is called commission. (They also usually have a base salary, which will again be dependent on the type products, services and customers they are serving.) The Sales team has sales targets (quotas) and can quantifiably demonstrate how they have performed. Again, it is a step function. They either sold something, or they didn’t. The more they sell, the more commission they get, and the greater their total compensation.

Operations on the other hand are not compensated based on “how much” they deliver or implement. Operations job is to deliver and implement all that Sales sells. This is a given. Operations may have incentives and bonuses based on “how well” they deliver and implement. How well operations delivers is also quantifiable and can be measured in several ways, including time (is it implemented on time or early), financially (is it implemented on or under budget) or the most important metric, was the customer satisfied when the implementation was complete. Again we have some fairly quantifiable metrics here. Time, budgets and customers satisfaction can all be measured.

My purpose in attempting to pre-define in simple terms the Sales and Operations roles is to point out and think about all the other roles that seem to have evolved, or devolved in companies from these two required business functions. It appears that many businesses have created or acquired roles that can best be described as either “Sales Support” of “Operations Support”. That means these roles are associated with either the Sales or Operations functions, but do not have either the responsibility or control to accomplish the tasks of selling or implementing. It also seems that by not having the direct responsibility of the line function, that these groups also do not have the direct risk associated with the defined business performance that is required. When a Sales person does not make quota, or an Operations person does not implement the project on time, which specific support person has responsibility for those failures?

I understand the ideas of team and how people as an organized group are more powerful than that as individuals, but where can the line be drawn here? Personally I look in a couple of specific areas. In Sales I like to look at how many people get compensated or commission for each individual sales success. How many commissions are being paid for each single sale? How many different forecasts and how many different sales reports is it showing up in? If individuals or groups are truly in or associated with the sales function, then their expenses should be associated with the sales function, they should carry quotas (remember, the more people in the sales group, the greater the quota that the group will need to carry in order to sustain the headcount) and their compensation should reflect a commission oriented structure.

In Operations I like to look at how many times each Delivery / Implementation opportunity must be presented for review, and to which audiences. I have been in roles where it was not uncommon to present the same information four to five times including “Dry Run” preparation, so that when you actually did present the information to the policy and decision senior management, it had the proper format and appearance. Operations are about efficiency, accuracy and speed. Do the job once, get it right and move on to the next one. The number of programs for efficiency and process improvement currently in vogue today would lead us to believe that it was amazing that any company was ever profitable or efficient in their operation.

Please do not get me wrong. I am fully in favor of providing any desired support to both Sales and Operations. I believe that the decision for requesting that support, and paying for that support should rest with the Sales and Operations teams. If Sales feels that it needs more sales support, then that support needs to be funded by sales in the form of increased sales targets and quotas. Most sales teams have a Sales per Staff metric. If Sales feels it needs more staff, then they need to generate more sales to support them. If Sales feels it can accomplish its goals with fewer staff, then they should be more richly compensated and commissioned for that as well. Sales is a Risk-Return role. If they are willing to take the risk associated with not attaining their goals, then they should also receive the associated and promised compensation when they achieve them.

On the other side of the divide, if operations feels that it needs more operations support, then that support needs to be funded by operations in the form of increased efficiencies and improved earnings associated with deliveries and implementations. If Operations is looking at an operating profit per staff metric, then more staff would need to generate greater efficiencies that would in turn generate better operating profits. If Operations feels it can accomplish its goals with fewer staff, then they too should be incited and provided bonuses for that as well.

It appears that as time has passed many of these supporting and enabling positions have migrated outside the control of the business function they were created to serve and have taken on lives and purposes of their own. Roles that were once viewed as specific ways to specific means seem to have become a means all unto their own.

It has been said that “When you are a hammer, everything looks like a nail.” I guess the business equivalent is that when you are in support, everything looks like it needs support.

Too many times the “support” decision seems to have been removed from the business line functions of Sales and Operations and put in the hands of some other management function. With this type of structure in place the support team loses its responsibility relationship with the line organization and becomes more of a corporate tax on those line organizations for programs that they may or may not agree with or support. How can the value of the support be quantified when it is no longer within the purview of the line function being supported.

If there is work that needs to be done within the business, but is outside the line functions of Sales and Operations, that is understandable. Don’t try and put it within those structures. Leave it within the management “support” structure where it too can be visible, monitored and hopefully quantified. Leave the support of both Sales and Operations to those functions where they can decide and implement the levels and types of support structures, if any, that they desire or need. By assuring that those functions have clear objectives, financial and otherwise, you can be reasonably assured that any support that they request and fund will be valuable to the business.