How to Deal with Conflicts Between Marketing and Operations

How to Deal with Conflicts Between Marketing and Operations

Shapiro recognized several reasons for the conflicts between marketing and operations teams:

• CAPACITY MANAGEMENT AND LONG-TERM SALES PROJECTIONS: Operations teams are constrained in their ability to flexibly adjust the (long-term) manufacturing planning to short term changes in demand factors and marketing forecasts. Short term changes in the physical delivery of goods promised by the marketing team come at the expense of the organization as a whole.

• PRODUCTION SCHEDULING AND SHORT-TERM SALES PROJECTIONS: As marketing is not directly involved in developing production plans, due to their close interaction with customers it is a challenge for marketing to develop precise forecasts.
• DELIVERY AND PHYSICAL DISTRIBUTION: It is also a challenge for the operations team to ensure alignment between the sales / marketing forecasts and inventory availability. Ensuring the maximum quality while producing a large variety of goods in a limited amount of time is difficult. As a result of time constraints, quality issues resulting from systems errors get fixed at a later stage of the product development and delivery process instead of being repaired at the source. This leads to repeat errors and lost time.
• ENSURING QUALITY: From an operations point of view increased variety in operating systems leads to increased inventories; more frequent and costly set ups; increases in processing and distribution requirements; higher costs. These result in higher probability of errors and customer disappointments. However, resistance from the operations team to produce large varieties of goods is often regarded as a source of lost sales volumes by marketing teams.
• BREADTH OF PRODUCT LINE: Marketers like a broad product line while manufacturers want a uniform product line.
• COST CONTROL: Marketing and operations teams have different perspectives on the cost base of production. From a marketing perspective, costs are perceived as a constraint to offer the best prices to company’s customers. From the operations point of view, higher costs are a result of marketing’s irrational promises to customers to deliver a broad variety of goods, fast delivery times, superior quality and new products.
• INTRODUCTION OF NEW PRODUCTS: From a manufacturing point of view, pushes for continuous new product developments and quality improvements require new systems and processes, new skills and personnel to operate these processes. From a marketing perspective, new products are necessary for business growth. However, the demands from marketing put large pressures on the manufacturing and are therefore often regarded as 'unreasonable' by operations teams.
• ADJUNCT SERVICES: Services like installation, field service or repair are perceived differently by marketing and manufacturing too.

⇒ How can one resolve this dilemma between the legitimate interests of sales/marketing and operations/manufacturing? Thanks for sharing your experiences…
Shapiro, B.P. (1977), "Can Marketing and Manufacturing Coexist?", Harvard Business Review, 55, 5, pp. 104-114

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		Carl-Henric Nilsson Professor, Sweden
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		Stephen lane Director, United Kingdom
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		Sabine Pitcher Manager, United Kingdom
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