Assignment: Aligning sales and operations

Assignment: Aligning sales and operations

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Aligning sales and operations management: an agenda for inquiry

Devarajan Rangarajana,*, Arun Sharmab, Bert Paesbrugghec and Robert Bouted

aMarketing Department, Ball State University, Muncie, IN, 47306, USA; bMarketing Department, University of Miami, PO Box 248147, Coral Gables, FL 33124-6554, USA; cI �ESEG School of Management, Parvis de la D�efense, P92044 Paris – La D�efense Cedex, France;

dVlerick Business School – Leuven Campus, Supply Chain, Leuven, Belgium

(Received 20 May 2017; accepted 6 March 2018)

There is a rapid growth in solution selling in practice and a commensurate increase in research in this area. The focus of this sales strategy is on providing solutions to customer problems that typically entail combining products and services from the provider firm as well as other firms. The fulfilment of these solutions requires operations management support. Despite the need for closer collaboration between sales and operations management, more research is needed on the interface of these two functions. To deepen our understanding of the interface of sales and operations management, we undertook qualitative research and conducted in-depth interviews of senior executives in global firms to determine the need for sales and operations management cooperation. We followed the qualitative research with a review of extant research on the interface of sales and operations management. Finally, we conducted a survey of academic researchers to identify areas and themes of future research in this area. We summarize the implications of our findings for future research.

Keywords: sales and operations management; integration; solution selling; cooperation

In today’s hypercompetitive marketplace, sales organiza-

tions are increasingly focusing on consultative selling and

solution selling. An ignored aspect of solution or consulta-

tive selling is the role of operations management in the

selling process. As an example, Tuli et al. (2007, 5) define

solutions as “a set of customer–supplier relational pro-

cesses comprising (1) customer requirements definition,

(2) customization and integration of goods and/or services

and (3) their deployment, and (4) post deployment cus-

tomer support, all of which are aimed at meeting custom-

ers’ business needs.” While the sales function is critical in

the first two stages, the service function is critical in the

fourth stage, and the operations management function is

critical for the second and third stages. It is clear that there

is need for a deep integration of sales and operations man-

agement in solution selling, and noninvolvement of opera-

tions management with sales could lead to failure to fulfil

customer needs. While there has been considerable

research on the interface of sales and service (e.g., Neu

and Brown 2005; Rapp et al. 2017), additional research is

needed on the interface of sales and operations manage-

ment. This is in the context of “portfolio of relationships”

suggested by Plouffe et al. (2016), in which salespeople

need to manage relationships with customers, internal

business functions, and external business partners. More

research is needed because firms that have tried to move

to solution selling have seen little gain from it (Johansson

et al. 2003; Stanley and Wojcik 2005; Sharma and Iyer

2011). One reason for the lack of gains may be the

absence of coordination between sales and operations

management. Operations management is typically focused

on lean operations and efficiency, and providing custom-

ized solutions for customers has not been a priority.

In general, there has been a call for enhanced coopera-

tion between different functional areas (Gulati 2013;

Kotler, Rackham, and Krishnaswamy 2006) to deliver

successful customer solutions (Kumar 2004), but more

academic research is needed. As Esper et al. (2010) sug-

gested, integration between demand and supply is

regarded as necessary, but seldom achieved.

In this article, we focus on the collaboration between

sales and operations management from a broad perspec-

tive. In this regard, we attempt to determine the

interaction between sales and operations management and

take a three-pronged research approach – managerial per-

spectives, examining extant research, and collecting data

from researchers on what areas would enhance their

understanding of the interaction. This multimethod per-

spective allows us to better understand and identify gaps,

which when addressed will enhance our understanding of

the sales and operations management area.

To achieve these objectives, we first conducted a qual-

itative research study by undertaking in-depth interviews

with senior executives in 10 firms. We wanted to deter-

mine the need for sales and operations management col-

laboration and to identify some key drivers of successful

*Corresponding author. Email: drangarajan@bsu.edu

� 2018 Pi Sigma Epsilon National Educational Foundation

Journal of Personal Selling & Sales Management, 2018

Vol. 38, No. 2, 220–240, https://doi.org/10.1080/08853134.2018.1450148

cross-functional relationships. Following the qualitative

research, we conducted a review of extant research on the

interface between sales and operations management and

found limited research. Then we conducted a survey of

academic researchers in the area to identify areas and

themes of future research in this area, followed by a sec-

ond qualitative study of managers from an additional ten

firms.

In examining the research gaps, we found that mana-

gerial issues such as the creation of an interface depart-

ment, salespeople getting overall customer satisfaction

targets, and organizational culture issues such as job rota-

tions, special organizational programs to promote collabo-

ration, and joint training programs have not been

addressed in the current literature. We also found that aca-

demics suggest further research in the areas of technol-

ogy/sales-force automation, intraorganizational issues,

forecasting, sales evaluation and performance, and sales/

marketing strategy.

The layout of the article is as follows. We start by

examining the critical need for interfunctional coordina-

tion and sales and operations management coordination

and highlight the consequences if this is not achieved. We

then report on a qualitative research in which we inter-

viewed senior executives from 10 firms to understand the

practitioner’s view of the coordination of sales and opera-

tions management. We then report on the results of a liter-

ature review in the area of marketing and operations

management. This is followed by a section based on a sur-

vey of academics, who identify areas for future research

and suggest possible research questions, and a follow-up

qualitative study. We conclude with a summary of our

findings and implications for research and practice.

Need for cooperation between sales and operations

management