Raising awareness of the tight connection between sales…
““Raising awareness of the tight connection between sales and production also helps guard against one of the great evils of traditional selling and order-taking systems, namely the resort to bonus systems to motivate a sales force working with no real knowledge of or concern about the capabilities of the production system. These methods produce periodic surges in orders at the end of each bonus period (even though underlying demand hasn’t changed) and an occasional “order of the century” drummed up by a bonus-hungry sales staff, which the production system can’t possibly accommodate. Both lead to late deliveries and bad will from the customer. In other words, they magically generate muda.””
About This Quote
This interpretation was drafted with AI assistance. It is one reading of the quote, not the author's own explanation.
Linking sales incentives to production capacity creates artificial demand spikes, causing inefficiency and customer dissatisfaction.
In simple terms: Misaligned incentives cause waste and delays.
Key Takeaway
Align sales goals with production reality.
Themes
business
operations
efficiency
Mood
analytical
critical
Type
business
strategic
When to use this quote
- sales planning
- production scheduling
- customer service
- performance metrics
Key Concepts
muda
incentive misalignment
production constraints
Questions to Reflect On
- How can companies redesign incentives to reduce waste?
- What metrics better reflect true demand?
A Different Perspective
Bonus-driven sales can motivate short-term gains over long-term health.