Inventory management is typically associated with product businesses. It can also be helpful in service businesses. Inventory management, when used as a business strategy maneuver, often leads to competitive advantages with deep moats and higher barriers of entry. Service inventory management can be an incredible tool to enable a sales team that helps remove obstacles, keeps the sales team’s activities aligned with business objectives and reduces costs in sales processes.
For inventory management in this context, “inventory” is defined as products to sell, services to sell and capabilities that could be sellable. “Sellable,” meaning able to be further monetized.
This is where the cross-functional aspect comes in.
Invite your Marketing and Sales functions on an internal field trip through inventory.
Why?
Your Marketing and Sales functions are market-facing. As part of Market Operations, Marketing and Sales have an understanding of the market that your more internal-facing functions don’t have. Not only do they have market knowledge and market intelligence, but they think about the market differently than your internal-facing functions do. Much like a CFO, who’s job it is to think about money – strategically, the Marketing and Sales functions think about the market.
[This is assuming that your Marketing and Sales functions are set up to be both strategic and tactical. If your Marketing and Sales functions are set up to be solely for tactical execution, you’ll need an outsourced partner to work with your Market Operations teams to fill the gap. The AxisPointe can help with this.]A large part of thinking about the market in this way is customer value and how that is converted to business value. Marketing and Sales play a significant role in Market Operations. Market Operations, in this context, is all of the operations that do their work in the market (Marketing, Sales, Business Development, Customer Experience, Distribution of Products/Services and certain aspects of M&A). In the market is where all the action is. That is where business actually happens. And that is where all the opportunity is.
An organization actually has two operational functions:
- Internal Operations, as we have always thought about traditional Operations
- Market Operations, which is everything a business does in the market that is market-facing.
Internal Operations and Market Operations have many overlaps that we would see in a traditional Venn diagram showing the logical relations between the two.
During the internal field trip through inventory, Marketing and Sales will have slightly different perspectives because they operate differently from each other. This is a good thing. Each perspective will be incredibly helpful because, when brought together, the perspectives of Marketing and Sales will give you a more complete view of the market. This, in turn, allows you to more clearly see opportunities for inventory, whether that inventory is products or services.
Opportunities for inventory reveal what is sellable. Some of what is sellable will be obvious and not new information. Other aspects of what is sellable will show you creative ways to move inventory and even spur innovation.
Cross-functional inventory management has created new revenue streams, increased profitability and built competitive business models for organizations. There is an added benefit to your internal culture that happens by default.
Inventory management done in this way pulls its weight in a way that is more valuable to the business, as a whole.
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