23 Mar What happens to revenue visibility after closing a deal in manufacturing?
by Tom Lovell, Jim Nader, Levi Kurtright
While 2020 certainly underscored the crucial importance of supply chain stability and transparency, it’s estimated that still only six percent of organizations actually have full visibility into their supply chain and production floor operations. This isn’t great news for businesses in any industry. But for manufacturers, it’s particularly troublesome due to the amount of capital invested in their operations.
Many manufacturers are based on run-rate business models, or, in other words, money that is anticipated and projected but not yet realized because it’s tied up in future, multi-year sales agreements. These are the types of companies that are relying on long-term contracts and revenue realization to sustain their operations. And this means the revenue view is constantly inching forward, requiring financial data about projects and sales agreements pegged for two, five, or ten years later on the calendar. But if you don’t have the sales agreement data completely integrated and automated with your revenue reporting, your revenue planning and visibility are lost completely.
Simplus recently worked on a Manufacturing Cloud implementation project with a manufacturer that specializes in automotive parts and was facing this same long-view revenue hurdle. The client’s Salesforce custom configuration from a previous partner was not built with scalability in mind, only tracked opportunities up to the point of closed won or lost, and could not directly feed the revenue forecast. Salesforce was essentially a sales process island, while the revenue forecast was updated manually in an off-line spreadsheet. There was no reliable visibility for the company at large to forecast revenue from the combination of already-booked sales agreements and yet-to-be-booked opportunities.
However, working with Simplus and our expertise on Manufacturing Cloud, this client found a way to remedy the situation and created a foundation for additional future capabilities and enhancements. From this, we’ve gathered a few must-have technology lessons for manufacturers operating on similarly long-term or “run-rate” business that we’d like to share:
Automate tedious sales tasks
As we worked hand in hand with this client through their Manufacturing Cloud implementation, one of the biggest themes was finding ways to simplify opportunity management by creating automated processes wherever possible. Anything related to their product and engineering data is now being captured within the opportunity records. This means it can be tracked—beginning to end—and then even once closed, the client can still track that existing business record for ongoing revenue.
So not only is their Salesforce instance good for tracking new business, as is standard, but it can also manage…
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Tom is VP, Manufacturing CoE here at Simplus. For over 15 years, Tom has helped companies implement data and process-driven strategies to bridge the gap between business and IT. These strategies have improved patient outcomes, reduced financial risk, and improved operational efficiency in healthcare organizations while bringing to bear streamlined costs, reduced risk, and improved revenue at manufacturers. His passion is architecting and sharing practical solutions that deliver valuable results for customers.
Jim is Manufacturing Sales Director here at Simplus. He has been working in the Salesforce platform ecosystem for over six years and in the automotive and manufacturing advisory for over 25 years. Nader provides program guidance and manufacturing subject matter expertise, facilitates client project planning, and provides best practice insights on sales, service, and forecasting processes. Nader has global experience doing business in Japan, Korea, China, Germany, France, Italy, and England.
Levi is a Solution Architect here at Simplus. He is a deeply accomplished and results-driven Salesforce professional with a consistent documented record of implementing technology platforms to drive company growth. Levi specializes in the manufacturing vertical with over 10 years of experience implementing technology solutions.