Winning Manufacturing Strategies

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July 27, 2012

Embrace Personalization: Time to sit up and take notice

Ever wondered why we keep frequenting the same local shop, why we go to the same retailer again and again or why we prefer one outlet over another? If you look closely there is not much difference in the offerings of one retailer from the other. They all have the same store layout, same assortments, even the same offers and discounts. Still we tend to have proclivity towards our favorite, why?

The answer lies in the Special Attention that we get. Some call it special service and some call it attention to detail, you can call it Personalization. Its basic human psychology, we all crave for attention and we all love to be treated specially. Then why do we forget this when we are catering to our customers online!

In the real world costs of personalization are huge and it acts as a hindrance, but coming to the online scenario the ROI is immensely huge considering the small investments to be made. It's not that difficult these days to implement different pages for different sections of the audience. You just need to revisit your marketing basics:

 

personalisation.pngYou need to relentlessly stick to these basics to get your product to the right customers.

There are various tools in the market which can help you do this e.g. if you are a supplier to major OEMs in automotive sector covering two wheelers, four wheelers, heavy vehicles etc., you can provide different landing pages for different OEMs on your site.

If a two wheeler OEM visits your site and is catered products and offers relevant to four wheelers it defeats the whole purpose! A two wheeler OEM coming to your site should be directly taken to the page relevant to the two wheelers (not four wheelers or heavy vehicles) and provided with the offers related to their interest. I know all this takes a bit of extra effort, but it goes a long way in forging solid long term relationships with your partners!

 

"It is no longer good enough to simply satisfy your customers or to have a product that works. No longer can you merely deliver a service within the timescale you have set. All these are important and we have to do them. But what will really make the difference is when the customer asks: when I went through that experience, did the provider really engage with me, did they understand my needs, did they think logically about what was best for me?" Jo Causon, My Customer

 

July 24, 2012

Product compliance - "SVHC" for the Manufacturing Industry Value chain!

 

As I walked out of the discussion on strategies to adopt for managing compliance, the regulatory influence of RoHS, REACH, WEEE in manufacturing industry still occupied my thoughts.  The discussion had clearly established how Product compliance had become a "Subject of Very High Concern" for the Value Chain. With increased awareness among the customers and stricter regulatory implementation, the Product compliance has indeed come on priority list of CXOs. The risks are real

·         Impact on the  Brand including  loss of customer confidence

·         Denial of access to markets

·         Increased Risk exposure of the portfolio of products

·         Cost that could turn manufacturer  unprofitable -  cost of delayed NPDI; Obsolescence costs due to discontinuation of non-compliant parts, supply chain redesign...and more

Well, now It is no longer just the 5 substances in RoHS, The regulatory introduction and evolution seems to be outpacing adoption in manufacturing industry with newer ones on horizon - RoHS2, Conflict minerals, EU Battery directives and expanding list of the SVHC (substances of Very High Concern) in REACH.

So what makes "Product compliance" in manufacturing industry difficult?

Host of factors indeed...

·         Compliance is determined by all the value chain players, much beyond the control of a single organization

·         Frequent updates to regulations and associated interpretation issues

·         The requirements have moved beyond  "Yes/No"  compliance confirmation from suppliers and new mandates require OEMs to provide time binding disclosure of substance information

·         Overwhelming data - Continuously changing part information due to change and new parts, disparate data requirements coupled with complex calculations and roll-up needs

·         Short Product lifecycles and increasing complexity of BOM configurations

·         Sustainability issues buried deep down in the supply chain as in case of "Conflict minerals"

·         Lot of manual interventions as process maturity and IT systems are progressing (stds like IPC-1752a) to adapt

...and this all costs money

How is compliance impacting the value chain?

Product Compliance touches various value chain processes and necessitates collaboration among players.

 

While choice of material, reduction in weight are introduced during  product design, choice of "green suppliers"  has bearings on procurement and outsourcing,  Target markets determine packaging and labeling , warranty and collection obligations influence logistics (including reverse logistics).

 

Moreover the unbundling of product value chain adds complexity further increasing chances of non-compliant product introduction. Take example of High tech - the players in the chain includes OEM, semiconductor, distributor, contract manufacturer/EMS or ODM company and each one has a play in determining the product compliance

 

The corrective action for non-compliance could also spread across resulting  in  Product re-design, look-out for substitutes, alternate supplier development effort, stop shipment, Obsolescence of inventory, Recall of product and more

 

 

Has the case for "Full Material disclosure" (FMD) approach become stronger?

Generally speaking it seems to be the case. Increasing data extent, data collection need, validation against multiple specs and building a common understanding of the regulation across value chain has become vital to deliver a compliant product.

However there are multiple other factors that are shaping enterprise response ...

·         Regulatory mandate and demand from market

·         Extent of data to collect - data requirements keep evolving adding on to "what information" to collect

·         Confidentiality and IP related issues

·         The cost involved  - both administrative costs and corrective action costs

FMD approach when extended further also leads to topics of creating and leveraging industry wide data sources like IMDS for automotive.

Some determinants for the Product compliance enterprise IT strategy...

The solution obviously requires an Enterprise IT strategy towards compliance, given the bulk of the challenges are in "Information" domain across the value chain.  The solution footprint needs to span across enterprise applications enabling touch points to processes in CRM, PLM, SCM.  

It is also clear that a good solution demands capabilities of data hub, flexible rule engine, analytics and reporting to manage multiple facets of compliance. Given the value chain set-up, the need for security, access, and standards based data exchange has become even more evident.  Various Enterprise application providers are now offerings some capabilities addressing parts of this challenge

As this discussion continues to evolve, what remains beyond doubt is that it is time to think strategically about this Subject of Very High Concern.

July 12, 2012

The Game of Conversions

 

Game1.pngWe are well versed with the indoor games and of course the outdoor ones... Yeah to some extend the ones on TV and Video. But what is this new game that the bytes are playing on the net. Sorry not the online games, but the digital marketing tug of war happening online.

Customer life cycle with any organization has three main stages. Pre Conversion, Conversion and Post Conversion. Pre Conversion is the stage where both Customer and Organization are strangers to each other. Love at first sight is a myth other than in some of our Bollywood movies. The only way to attract here is to create awareness and lead the person to the point of sale. Relationships at this point are shallow and it's always one way. All heroes cannot be Rajanikant J Traditionally all marketing efforts were focused on this stage and ended here. The exposure is high as its free flow across to all. Television, Print media, hoardings are some examples. But efficiency is very less. As it's neither interactive nor targeted to a segment or context

 

The next stage is the Conversion period. Here the customer is with you and no more a stranger. Risk is high and higher is the reward. A small error takes the customer away from you. Listen, Learn and leverage forms the mantra in courtship. Competition should be kept out of sight and the experience should be so immersive that the user will not have any other byte in mind than you. Context, Intent, Personalization, Recommendations, Ratings and Reviews are the means to woo.  Experience strengthens the relationship and leads to commitment.

 

In the evolution curve of marketing, this stage came into focus later and then CMOs realized that return rate is higher with the known pool than with a blind date. So they started with List Building initiatives and started targeting this segment and saw the ROI rising. Any campaign run on existing customer list runs longer and increases chance of return. While traditional marketing events died short and without much fanfare.

 

Gone on knees and proposed. Committed for transaction. Stage Three - Post Conversion. This stage was never an opportunity but a colorless happily never after syndrome. Till recently... Then the social revolution came and colored this phase. Each customer owns the power to influence all in his social graph and this became the era for viral marketing. Sentiments Influence and social networks can make or break a brand. Maintaining trust and credibility is the priority in all CMO's list.

 

This stage is not for marketing but strengthening the relationship and creating more with Social List building. Social is never a start in marketing but a continuation. Sharing creates exposure through personnel recommendations and thus conversion rate is very high.

game2.png 

To conclude, Marketing is not confined to any stage of customer life cycle but it is Omnipresent in all stages in different avatars as the relationship matures.

 

Some more bytes from me in the below links

 

Three Marketeers

The Data R evolution

Data Alchemy

RFID enabled visibility in the Manufacturing supply chain

Various manufacturing organizations and their suppliers are rapidly adopting RFID to increase the efficiency and to streamline their processes.

In any industry involving multiple parties dealing with shipment of products, having "visibility" becomes an impetus. The manufacturing industry supply-chain also faces the following recurring problems including but not limited to:

* Dispatch Miss: If there is no ASN (Advanced Shipment Notification) sent by the supplier for the parts being shipped, then there is high probability of a scenario where what is received by the manufacturer is not same as what was expected. This can result in productivity losses, extra freight cost in getting the missing products air-shipped, delayed payments and bitterness in relationship with suppliers.

* Assembly of Variants: Verifying the correctness of an assembly requires the correct parts for a particular variant to be "visible" and available immediately to the engineer on the shop-floor.

* WIP Tracking: Locating misplaced parts in the warehouse and ensuring they are available at the production line is critical to avoid line-stoppage.

* Finished Goods Visibility: While fulfilling a large order, it is essential to locate where the correct finished product is kept and bring it to the loading dock-door in minimal time.

Many such issues can be addressed with the use of AIDC (Automatic Identification and Data Capture) technologies. This view-point discusses the possibility of introducing RFID and Barcode based tracking into the Manufacturing supply-chain with minimal disruption to the operations of both, the manufacturer as well as the supplier.

For discussing more, please leave your thoughts below.

July 2, 2012

Butterfly Effect: Analytics and Social media

Posted by Varun Chhibber, Associate Consultant, MFGCSI- Digital Transformation Practice, Infosys

Recent posts by Priya Thampi had me thinking about the fascinating world of Analytics. Social media explosion has given an altogether different twist to the saga and the organizations today have very powerful tools at their disposal to gauge the pulse of the consumers.

Analytics earlier was confined to the boundaries of structured data (tables, charts etc.) and then came Social media! It brought along with it an avalanche of unstructured data and since then organizations have been struggling to grapple with the new found realities and needs of the latest social media rampage.

data.png

 

It's just unbelievable to see organizations predicting consumer behaviors with such precision today, recently a store successfully predicted a teenager's pregnancy even before her father found out! Not only did they predict it, they used it to recommend products to her carefully blended with an assortment of different products in a catalogue so as not to alarm anyone.

Organizations are looking at the vast field of social media and picking up signals which were earlier ignored or deemed insignificant. Today looking at a tweet or a comment on Facebook we can tell about the sentiments behind that tweet/ comment. This kind of sophistication was unheard of earlier, and organizations had ever increasing data related to them but didn't knew what to do with it.

Today an organization can keep track of the chatter that's going on about them in social media and even segregate it on the basis of sentiments(Positive/ Negative/ Neutral). This helps a lot in taking swift affirmative action. Imagine the damage a disgruntled customer can cause if you let it go unchecked on social media sites, and if that customer happens to be a powerful celebrity, it can turn into a huge image crisis for you!

 

SENTIMENT.pngSentiment analysis helps us to collect all the chatter going on in the social arena and categorize it on the basis of sentiment associated with it. This information can then be used by the various departments e.g. customer service department can pick up the negative chatter about a service and directly contact the customer to assuage the dissonance. By doing this not only are you serving your customers better but at the same time you are converting the negative chatter into positive chatter as this could provide you with Brownie points in terms of the positive comments that will follow your quick redressal of the situation.

So beware whenever a distant butterfly flaps its wings (consumer writing a review/ comment/tweet) in the social media eco system, it can form a hurricane (PR crisis) for all you know! 

 

 

 

 

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