Many Consumer Packaged Goods (CPG) companies are trapped in a cycle of blame games: Brand Managers accuse Account Managers of not supporting their initiatives, causing them to miss their sales plans.
Account Managers accuse Brand Managers of expecting all of their initiatives to be fully supported, despite limited resources like shelf space and trade spend budgets.
How do you optimally allocate resources across initiatives and brands without descending into these blame games?
We at o9 Solutions witnessed this scene over and over again at different CPG companies, so we decided to design a solution to this fraught planning process.
It started with a core idea: take the Theory of Constraints, a concept that revolutionized supply chain optimization, and apply it to Sales & Marketing.
Each brand proposes various initiatives to support their sales targets, and each initiative requires specific resources owned by the account teams.
Since these resources are limited (or constrained), Account Managers clearly cannot support all of the initiatives.
They need clear guidelines for allocating these resources and selecting the right set of initiatives to fund - guidelines that can be shared with Brand Managers so that a consensus plan can be created.
Our solution consists of 4 key phases for applying the Theory of Constraints to Sales & Marketing.
Phase One: Initiative Planning
Phase Two: Constraint Optimized Selection
Phase Three: Consensus Business Plan Review (BPR) Meeting
Phase Four: Post Game Analysis