Which should you automate first: the chicken or the egg? Why sales and marketing is the logical place to start ramping up your business, and how to do it.
In The Automation Issue, we present a collection of expert essays on an important topic in the industry today. Here, Mark Coudray discusses automation in sales and marketing.
Since the theme for this issue is automation, I would like to set the stage by asking the question and offering a caveat. Why automate? On the surface, this may appear obvious. Automation can speed up a process. It can make a process more consistent, and it can add substantial efficiency to the output. All true, but automation also comes with a price that absolutely must be considered.
Back in 1977, I purchased my first automatic press. For the first couple of weeks, life was fantastic. So much product was going out the door that I almost couldn’t believe it. But my initial elation quickly turned into a nightmare.
You see, I had only considered automation at the production level. At the time, I was working 16 hours a day and had a six-month backlog of work. Orders were coming in faster than I could get them out. I had money in the bank. From all appearances, I had a successful business.
It took exactly three weeks to burn through the entire backlog. My accounts receivable skyrocketed from almost nothing to over $30,000 in 1977 dollars. (That’s more like $120,000 today.) I converted all of my cash to inventory, which in turn got converted to accounts receivable.
To make matters worse, I was completely out of orders with no pipeline to replace them. The steady stream of work coming in was now only enough to keep production going for a day at a time. I couldn’t spare time away from the shop to do outside sales. The source of my work had been almost entirely word of mouth, and I quickly discovered I couldn’t predict when the next order would come in.
Thirty days into automation and I was on the edge of closing the business. I was out of cash and couldn’t meet payroll. My sales were anemic compared to what I needed to keep production going. The worst part was that I didn’t have a clue as to what just happened.
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