Remedial Sales & Marketing Management

Today's Wall Street Journal has an article in the "Theory & Practice" column of the Marketplace Section. Sadly, as I wrote about here back in December, the Journal seems to be dumbing down a fair number of its management pieces. Today's was no exception.

The big news in today's column is that sometimes, your sales people will attain their revenue quotas by selling to unprofitable customers. Stop the presses!

But, wait. It gets better. The column's author, Jaclyne Badal, cites extensively from Mercer Management Consulting, on its sales management assignments. Apparently, this rather basic sales and marketing management principle is news to quite a few of the firm's clients.

You'd think that, with today's modern cost accounting systems, and extensive IT support, there would be fairly pervasive customer P&L accounting at most large firms. It appears you, and I, would be wrong.

What I don't understand is how something that was a topic over twenty years ago, when I completed my business management degrees, today requires consultants to help company marketing and sales managers figure out which customers are profitable- or that it is even an important consideration.

No wonder why we see so few companies consistently earn superior total returns. If American business truly needs remedial marketing and sales management of this type to improve its profitability, where are all the well-educated, intelligent MBAs going? Aren't they supposed to know this sort of thing? Wouldn't the ones who graduated, say, a decade ago, be in positions to effect better customer profitability management by now?

Perhaps it demonstrates how little value the MBA actually seems to be contributing to business management. If simple issues like customer profitability require many companies to hire expensive management consultants, most of whose analysts graduated from the same schools as those of the companies' new management hires, how are they going to get the complicated things right? Like product/market segmentation, new product development, and channel management?

It seems like this WSJ column, Theory & Practice, documents that business is long on inept practices, but short on decent theory to underpin those practices.