Clients that focus on providing a superior customer experience along with achieving optimal bottom-line results will perform better than competitors.

As companies are searching for ways to successfully navigate these turbulent times, the best ones are achieving a win-win focus on the customer and costs. Since the pandemic, there has been a heightened awareness of the customer experience as companies struggled with supply chain disruptions, delays, shortages, and the lack of resources. Similarly, as inflation has continued to be a drag on profits, companies are focusing additional efforts on cost reduction and margin improvement programs. Best yet, finding win-win solutions that improve the customer experience and cost will achieve substantial business results.

According to Zendesk CX Trends 2023 report, more than 50% of consumers will switch to a competitor after only one bad experience. This trend is not limited to consumers, as Zippia confirms with the finding that companies focusing on the customer experience increase their revenues by 80%. These are powerful statistics and demand attention. Clients that focus on providing a superior customer experience perform better than the rest.

Improving the customer experience without also improving the cost and margins will not support profitable growth. Thus, forward-thinking clients ensure cross-functional teams continually search for cost-reduction opportunities, experiment with new ways of doing business, and trial strategies to take performance to a new level. Continuous improvement alone will no longer cut it. The best companies focus on continuous iterative improvement as well as what can be seen as radical change.

Pertinent Examples

A healthcare products manufacturer wanted to grow sales after a prolonged period of product stability without an upgrade. In addition, key raw material costs increased significantly due to rising input costs derived from oil and natural gas. However, the company was owned by a private equity firm that wanted aggressive growth and a rapid increase in profitability, and they expected price increases to be offset as well as cost reductions to occur while increasing service levels. These conflicting goals could only be resolved with a cross-functional innovation team.

The leadership team empowered a cross-functional team including R&D, Packaging Engineering, Operations, Supply Chain, and Logistics. The primary focus was on redesigning the product so that it would provide improved performance for the customer while using less materials, optimizing packaging, and improving operational costs. The team involved both customers and suppliers in a collaborative design effort to find opportunities to redesign materials to work better yet reduce usage and scrap, optimize how the product ran on the production lines, and minimize warehousing and shipping costs with compressed packaging optimized for storage and transportation. The team launched an upgraded product line that spurred a 30% increase in sales while reducing costs by 20% in addition to offsetting key input price increases.

Additionally, the manufacturer implemented a demand planning and vendor managed inventory (VMI) program for its number-one customer. By looking into its customer’s demand data and inventory position at its distribution centers across the United States, the company was able to optimize its replenishment plans and reallocate products in a way that maximized customer service levels and reduced lead times while minimizing inventory levels internally and at its customer. In addition, the company was able to plan, which enabled it to optimize truckloads, utilize ideal routes, and maximize the volume of product per truckload, thereby saving 20% in freight costs. Most importantly, it soared to the top category on its customer’s scorecard.

Another medical device manufacturer followed the same path by working closely with its key customer to optimize product designs to provide innovative customer solutions while making the product less expensive to manufacture. It also invested significantly upfront in upgrading to ISO 13485 to ensure compliance and customer satisfaction while expanding the value internally across the entire shop (medical and non-medical) to standardize and promote efficiencies throughout the product flow. The company expanded business with its key customers and improved efficiencies with standard processes and automation wherever possible. Additionally, it assessed customer and product profitability and reviewed operational improvement ideas to reduce scrap rates and improve efficiencies.

Forward-thinking companies think strategically about creating a win-win of enhanced customer value and bottom-line results. Clients that focus on the customer and develop innovative and collaborative solutions tend to also outperform their competition in profitability and performance. During times of volatility, the companies focused on customers and cost will rise above the noise.

Originally published in Adhesives & Sealants Industry, December 2023

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Proactive Backlog Management to Dramatically Improve Service

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CLAREMONT, CA—Smart companies are keeping an eye on the impending economic downturn but not prepared to bring everything to a grinding halt, according to The Society for the Advancement of Consulting® (SAC). Opportunities exist—in providing better customer value, retaining talent, and using technology smartly—but only for companies that have the right momentum.

The Four Big Opportunities You Can Take Now

“Aside from tax planning, our most successful clients are not thinking about year-end,” points out Lisa Anderson, president of Claremont, CA-based LMA Consulting Group, Inc. and manufacturing expert known as the Strongest Link in Your Supply Chain. “Instead, they’re focusing on the opportunities ahead.”

“The big concern now is a potential downturn in demand, driven by continuing supply chain disruptions and surging inflation,” she explains. “But opportunities exist too. As more owner-operators retire, companies are purchased, supply chains move, and economic volatility provides challenges for the competition.”

“Those who understand their customers’ world are best placed to take advantage of these opportunities. That means determining their ideal customers, the value proposition in the marketplace, and investing in talent and technology. Together, this delivers a superior customer experience to those ideal customers,” adds Anderson.

Why Not to Let Your Talent Walk Out the Door

“What things are you doing in 2022 to ensure your talent sticks around in 2023?” asks Diane L. Garcia of Lorraine Consulting, LLC, who has over 15 years’ experience in operations and supply chain management and is an expert in helping clients improve their unique business processes. Diane applies cutting-edge supply chain optimization knowledge and implements best practices with manufacturing and distribution companies in North America.

“My manufacturing clients across every industry are experiencing some degree of talent constraints,” notes Garcia. “The best way to obtain talent is to retain what you have within your organization. Alongside supporting year-end financial and customer service goals, I recommend you make your teams feel valued. Hint: People enjoy time off during the holidays.”

Best to Make Tweaks in the Final Weeks

“Preparing for year-end should have taken place earlier in the year,” according to Kathleen McEntee is President of Kathleen McEntee and Associates Ltd, a full-service marketing firm focused on distinguishing businesses with practical marketing strategies and tactics that deliver results. “Goals established. Game plans developed. Team determined. ROI identified. Measurements in place so that tweaks could be made along the way. Now is the time to make any last-minute tweaks to encourage customers to engage, so as not to get caught short—this is the time to update messaging and plan additional communications.”

“It’s also the time to begin the planning process for 2023,” advises McEntee. “Nobody has a crystal ball, but planning for the expected and the unexpected will put companies ahead of their competition.”

Time to Invest, Not to Panic

Successful companies use economic disruptions and market volatility as an opportunity to invest in customers and marketing, according to Linda Popky, president of Redwood Shores, CA-based strategic firm marketing firm Leverage2Market Associates, and author of the book Marketing Above the Noise: Achieve Strategic Advantage with Marketing That Matters, and year end is a perfect time to demonstrate support.

“This is the time when customers need to know they are valued, their needs will be met, and they can count on their partners and suppliers to come through as needed,” she notes.

“This means taking the time to help customers prepare for the activities they need to be successful in the new year, and to ensure they aren’t derailed by the latest news,” Popky adds. “Markets go up and down. Inflation causes price hikes. Customers will continue to support those companies who provide them consistent ongoing value—regardless of external events.”

Get this Mindset into Your Managers for 2023

“Stop preparing for year-end,” said SAC Founder Alan Weiss, PhD. “Despite the financial requirements of a fiscal year that coincides with the calendar year, there is nothing magical about year-end. In fact, the attitude might better be “year beginning.” Too many companies come to a screeching halt and then have to restart their engines from a standing stop in the new year. Full speed ahead.”

Originally posted on SAC website: October 1, 2022

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We are in a new era with more opportunity to grow than ever before. COVID is largely in the rear-view mirror, and the strong companies are getting stronger. Consumers have returned to the scene and are robust purchasers of products, homes and services. Are you ready to grow and scale? Have you taken control of your end-to-end supply chain so that you can take advantage of the opportunities?

Taking Control of Your End-to-End Supply Chain

To support customer needs and be prepared to pursue revenue opportunities, the smart are taking control. They aren’t waiting for the supply chain to straighten itself out. Read my recent article in Brushware about how the global supply chain will not realign anytime soon. Instead, we must take control! Answer a few questions to determine if you have control of your supply chain.

• If a supplier to your critical material or component is disrupted, do you have a solution to carry on without noteworthy interruption.
• If your customer changes product needs on the fly, are your manufacturing operations and supply chain agile enough to change on the fly?
• If your customer or supplier reconfigures its supply chain, is your supply chain resilient to accommodate successfully to changing conditions?
• If your product, ingredients or raw materials get caught up in global conflict, protestor delays or weather-related events, will you be able to serve your customers?
• If you gain new customers, will you be able to adjust your manufacturing schedules to accommodate for the new requirements?
• If your revenue grows by 50-100%, can you scale up successfully?

How are Clients Taking Control of the Supply Chain?

Our most successful clients are taking control of their end-to-end supply chain. As customers needs evolve, you will need to make the appropriate changes (operationally, financially, R&D/ new products, supply chain, etc.) to meet these changing customer needs and support revenue growth while meeting profit/ EBITDA objectives. How are the best clients pivoting to take control of their supply chain?

Certainly, it depends on your particular industry, company strengths and position, and so it could take many forms. For example, a client supplying the building products industry has been vertically integrating manufacturing capabilities to quickly pivot to changing customer needs and to grow market share. Another client has been sourcing new manufacturing partners both regionally and around the world to build offload capabilities to meet increasing revenue opportunities. Other clients are expanding key manufacturing capabilities, purchasing equipment, and hiring people to grow inhouse capabilities whereas others are proactively expanding their footprint to provide greater flexibility in the future. Other clients are rationalizing skus and prioritizing strategic and profitable customers. Last but not least, another client is evaluating its supply chain network of outside distribution centers to reposition, consolidate and/or expand to meet changing customer conditions while continuing to manage working capital closely.

Taking Control With SIOP (S&OP/ IBP)

Our most successful clients are utilizing customized and collaborative SIOP (sales, inventory and operations planning) processes to understand customers’ needs, create revenue predictability, and, most importantly, to define what’s required to be able to deliver these needs successfully, predictably and profitably. Our most successful clients are definitely taking control to meet significant revenue opportunities whereas the mediocre continue to hope the supply chain will straighten out on its own.

During the monthly SIOP process, the potential and probable revenue opportunities are highlighted with enough clarity so that the executive team can take control over the strategic decisions required to support profitable growth. For example, a life sciences manufacturing client took control over the supply chain by building an additional facility to support growth. However, you don’t build a facility and gain customer approval for the new process quickly, and so they had to take control and develop an interim solution as well.

They knew they had to get a better handle on their forecast so they could carefully navigate how to increase interim production and meet customer orders. After reviewing historical growth rates by customer and product line, incorporating quotes with high probabilities of success, reviewing inventory agreements, monitoring new growth channels, and reviewing with sales and product teams, we defined a base forecast to launch the SIOP process. This enabled manufacturing to see into the future and define the specific proteins required to support the growth trajectory prior to the expanded facility availability. This allowed the manufacturing leader to take control and scale these specific proteins, reallocate space, build skills, purchase equipment, and order long lead-time materials to support growth, and it enabled the quality and bottling leaders to plan capacity accordingly to meet the interim demand. Additionally, modifications could be made to the frequency, volume and manner in which the manufacturing facility replenished its European and Pacific Rim locations to ensure customers’ needs were met. You’ll find more examples of how to grow and take control of your business by being directionally correct with sales and operations planning in our blog.

Customer Success with SIOP

SIOP is not a magical off-the-shelf solution. It is tailored to each client and the unique circumstances, strategies, differentiators, people, processes, systems, and data. As you get a directionally-correct monthly cadence going with cross-functional and potentially cross-organizational engagement, strategic issues and related roadblocks will emerge. These issues become the focus to create customer success. Whether success is created by improving OTD/ OTIF (on-time-in-full), reducing lead-times, or simply scaling production and logistics to meet increasing and evolving customer demand, SIOP will provide a framework for success.

Refer to our blog for many articles on SIOP. Also, read more about these types of strategies in our book, SIOP (Sales Inventory Operations Planning): Creating Predictable Revenue and EBITDA Growth. If you are interested in talking about what it would take to purse the SIOP journey in your business, contact us.

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Prescient Strategy & Manufacturing Resilience Using SIOP (S&OP)

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CLAREMONT, CA— The best way to raise profitability now is to determine customers’ needs in the new year and help address them, according to The Society for the Advancement of Consulting® (SAC). Providing clear, outstanding, and immediate value to customers will get businesses out of the depths of the COVID-19 crisis and raise their profitability.

Customers Crave Your Rapid Response Capabilities

“Manufacturers and distributors have a rare opportunity as the world emerges from COVID,” points out Lisa Anderson, president of Claremont, CA-based LMA Consulting Group, Inc. and manufacturing expert known for creating supply chain resiliency.

“Get on top of your changing customer needs so that you can rapidly evolve your products and services to provide a superior customer experience and grow sales,” says Anderson. “In addition, rapidly reassess your end-to-end supply chain to reposition, upgrade, and enable a resilient and responsive supply chain.”

“There are vast opportunities to get ahead of your customers’ needs and get a leg up on the competition,” she adds. “Those companies that reposition on the fly and better understand their customers’ changing needs will be able to apply the appropriate technologies to accelerate success and achieve scalable, profitable growth.”

Life’s Complicated Enough, So Make It Easier for Your Customers

“Companies need to work hard on simplifying their processes, products, and services,” says Praveen Puri, President of Praveen Puri, and expert in Strategic Simplicity® who advises on IT and business simplification. “Even post-COVID, the world continues to become more volatile, while attention becomes scarcer as people are bombarded with information and demands on their time. Those companies that can adapt to changes quickly, while making their customer’s lives easier, will enjoy a massive competitive advantage.”

Invest in Your Workforce, Particularly Leaders

“A company’s investment in its workforce will determine how quickly it recovers after COVID-19. Paying attention to employees during this pandemic can prevent a company from ending up worse off,” says Dr. Maynard Brusman, a San Francisco Bay Area consulting psychologist and executive coach.

According to Dr. Brusman, “When employees feel supported by their company, they work hard and are loyal, making the company more profitable. Behavioral economists note that leaders who respond to others with kindness have a significant effect on behavior. People who are shown kindness from their managers are likely to reciprocate with higher productivity. A company that cares about the health and well-being of their employees is more likely to experience growth and profitability.”

Dr. Brusman advises his executive coaching clients, “The care a company’s leaders demonstrate for their workforce will determine how quickly the company recovers after COVID-19.”

Full Customer-Centricity is the Next Fulcrum of Success

“Reshoring, offshoring, and nearshoring your supply chain. Developing your leaders in ways that are measurably connected to business objectives. Moving to new cloud-based IT services. All of these investment—in supply chain, people, and IT—are inherently good with one huge proviso: customers must gain,” explains Steven Hunt, an expert in leadership and accelerating collaboration in global companies.

“A big utility company in the EU,” he adds, “has just blocked an internal IT proposal to restructure for two simple reasons. It makes account access more complicated for customers, and it increases the time they spend paying their electricity bills.”

“The biggest driver of high growth next year is outside your company. It’s your customers,” Hunt notes. “Determine the factors they appreciate about your products and services. Then deliver those factors better or faster, or both.”

Find an Unmet Need and Fill It

As the world moves to a post-COVID era, customers will have a new set of critical needs—from maintaining the health and safety of their workers to remaining competitive in a new business environment, according to Linda Popky, president of Redwood Shores, CA-based strategic firm marketing firm Leverage2Market Associates, and author of the book Marketing Above the Noise: Achieve Strategic Advantage with Marketing That Matters.

“What we think we knew about our customers has changed dramatically over the last 9 months. It’s time to take a hard look at where businesses are now and what new challenges and opportunities they’ll likely face in the year ahead,” she says. “Those companies that are not afraid to move forward in spite of uncertainty and ambiguity will be much further ahead when the dust clears. This is a chance for innovative organizations to thrive by differentiating themselves from the rest of the pack.” 

Outstanding Value for an Outstanding Year

“You grow and increase profitability in the same way in any world: You offer outstanding value that is not a commodity but a distinguishing aspect of your business,” says SAC Founder Alan Weiss, PhD. “You base your fees on that value, not your time and not your physical presence. And you constantly innovate and climb, taking prudent risks.”

Originally published at SAC, December 1, 2020

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Well, no doubt about it, when it rains, it pours. I had a tooth ache that lasted about a week, and so I called my dentist. They took an X-ray, and it didn’t really show anything; however, when looking with a microscope, they could see the fracture. We had to do exploratory work to try to see what was required. Unfortunately, they couldn’t find the end of it, and so they sent me to a specialist to take a 3D X-ray. Unbelievably, the 3D X-ray didn’t show it either. Thus, after another X-ray for good measure, we had to do an exploratory root canal (my first) part 1 to see if it could be saved. Of course, that didn’t clarify it either and so the specialist conferred with my dentist, and they decided to proceed with part 2 which will likely solve it for several years minimally. Let’s hope!

I love Broadway plays and since that isn’t possible in person, I thought we’d use a fun one with this post. Have you seen The Little Shop of Horrors? Well, I had the opposite experience. What stood out was the level of caring that went into the process. My dentist was truly concerned to minimize my pain, and you could see her struggle with what to recommend for what was best for me. She wasn’t thinking about her practice or what was quick so she could get back to her day. The customer experience was top of mind. Are you thinking about what is best for your customers?

One Tip to Implement This Week:

I find that I talk a lot about the customer experience. After all, it is what differentiates successful companies from average companies. What are you doing to stand out from the crowd?

1. Do you think about your customer’s outcomes or your outcomes?: What is your first thought? You don’t have to share but think about it. How do you get to know what your customer needs?
2. How do you know what your customer needs? Sure, start by asking; however, I find that more often than not, they don’t know. Instead, pay attention to what they aren’t saying. Read between the lines. I don’t always know what I need until someone shows me an example.
3. Is your entire organization thinking about your customer? Everyone should be responsible for the customer.
4. Will digital help or hurt? By no means should we always default to digital. On the other hand, if you aren’t thinking about it, you are missing the boat. Instead, don’t jump to conclusions. Use your common sense.

Consider these strategies to provide a superior customer experience and make an impact. Read more about these types of ideas to navigate and successfully emerge post COVID-19 in my free eBook Future-Proofing Manufacturing & Supply Chain Post COVID-19. Please send your feedback and stories. I will incorporate into an article, video or interview.

Stay safe & healthy.

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If it isn’t already, your end-to-end supply chain must be part of your strategy discussions. I was recently featured at SAP’s SAPPHIRE NOW Coverage global conference on supply chain since it is such a timely topic.  Interest has been heightened as supply chain challenges intensify throughout the world. 

Minimally, we should be thinking about the following topics:

• Customers: Certainly, it is extremely clear by now whether you have a diversified customer base serving multiple markets or not. No matter your situation, consider what is likely to occur in the months and years ahead (as it will NOT stay the same), and get in front of it. Revise your strategy to build the customer base you want in the future.
• Suppliers: Although you might have seen supply chain issues arise with COVID-19, it is also likely that they are still lurking around the corner. Do you know your suppliers’ financial position? Are they one disruption away from closing the doors? For example, Wuhan has additional delays due to floods. Will that put your supplier(s) over the edge?
• Internal Operations: How are you doing managing the disruption and remaining efficient enough to remain profitable? Are you building your agility and resilience? How do you want your future to look? Are you utilizing a Sales, Inventory and Operations Planning process (SIOP) to ensure you navigate successfully?
• Technology: Is your technology roadmap sufficient to support your new reality and your future? I also interviewed an executive at Carrier at SAPPHIRE NOW as it relates to their supply chain and cloud ERP. 

You cannot delay while you navigate the current disruption. Get on top of your strategy, where you need to go and what you should be doing NOW to support the successful transformation of your business. I discussed these topics widely in my eBook about future proofing your manufacturing operations and extended supply chain. If you’d like to take a fresh look at your situation to devise a successful roadmap, please contact us.  

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CLAREMONT, CA— The current economic disruption is giving businesses big opportunities to take steps to redefine and renew the relationships and processes that customers value most, according to the Society for the Advancement of Consulting® (SAC). Businesses that tune into evolving customer needs will thrive the most in 2021.

Put Customer Needs and Innovation Top of Your Action List

“Manufacturers and distributors must get on top of changing customer needs so that they can get ahead of the curve,” points out Lisa Anderson, president of Claremont, CA-based LMA Consulting Group, Inc. and manufacturing expert known for creating supply chain resiliency. Start with your key customers and find out how you can provide value. Zero in on changing buying behaviors from their customers. Listen for opportunities for new, upgraded products and services, as well as new market opportunities.

“On the supply side, rethink, redesign, and innovate,” says Anderson. “Set up your operations, supply base, and related supply chain and logistics networks to be resilient to changing conditions, as well as efficient and profitable. You’ll be prepared to thrive post COVID-19 and take advantage of opportunities as they arise.”

Strike a Balance Between Independence and Interdependence

“Today’s business leaders face incredible pressure to anticipate, adapt, and produce.” says Dr. Maynard Brusman, a San Francisco Bay Area consulting psychologist and executive coach.

According to Dr. Brusman, “Figuring out what’s next is not easy for business leaders. What leaders need is a balance of independence and interdependence. What we have known about the past and assumed about the present is no longer sufficient to prepare for a desired future. Most people don’t like giving up control, especially in uncertain times. Perhaps that’s why we resist the idea of interdependence: we believe autonomy, individual liberty, and independence will yield greater innovation, production, and wealth. We need better interdependence to reach and maintain peak performance adding value.”

Dr. Brusman advises his executive coaching clients, “Focus on economics and management issues, as well as how you respond to social, technological, cultural, political, environmental, and religious issues.”

Value, Mission, and Relationships Key to Nonprofit Success

Karen Eber Davis, president of Sarasota, Florida-based nonprofit revenue growth firm, Karen Eber Davis Consulting, and author of Let’s Raise Nonprofit Millions Together, recommends three steps for leaders, especially those who lead nonprofits, to take now to thrive in 2021 and beyond.

“First, believe in your organization’s value. Second, do whatever it takes to build awareness for the mission,” she said. “Finally, develop and maintain robust relationships.”

Prepare for One Step Forward, Then Two More Steps Forward

“The best companies continually find ways to bring visibility and transparency into their relationships, partnerships, and processes,” according Diane L. Garcia of Lorraine Consulting, LLC. Diane has over 13 years’ experience in operations and supply chain management. She is an expert in helping clients improve on their unique business processes, applying cutting edge supply chain optimization knowledge, and implementing best practices with manufacturing and distribution companies.

“One way to prepare for the future is by utilizing business intelligence tools, which will assist you in leveraging the mountains of data you collect,” Garcia points out. “This will enable you to predict future trends. Sharing insights like this across the supply chain will support forward momentum,”

Fly High in 2021 with Customer Empathy and Motivation

“The two big steps to thriving in 2021 are using customer empathy and boosting motivation,” says Steven Hunt, an expert in global leadership growth at Steven Hunt & Associates.

“Customer empathy is re-imagining your products and processes from your customers’ 2020 perspective,” explains Hunt. “Like most airlines, Eurowings, Lufthansa’s budget airline, had prohibitive charges on re-booking flights, pre-Covid. But 2020 has given customers a different experience. Now, Eurowings is looking to make flight re-booking cheaper and easier permanently. This reflects what is technically possible, what customers value, and what customers are used to now.

“The second step is motivation. Months of being psychologically at full stretch—coping with the uncertainties of 2020—has induced listlessness and acedia in many people,” he points out. “To thrive in 2021, define a clear focal point for your business, create true commitment, and build up renewed levels of staff motivation.”

Focus on What Matters to Customers Now

Now, more than ever, organizations must take time to understand today’s customer priorities and challenges, then respond accordingly, according to Linda Popky, president of Redwood Shores, CA-based strategic firm marketing firm Leverage2Market Associates, and author of the book Marketing Above the Noise: Achieve Strategic Advantage with Marketing That Matters.

“Priorities have changed as a result of the pandemic. What seemed important nine months ago may not even be relevant now,” she notes. “Your value proposition to customers needs to focus on where they are today. Don’t rely on what worked before. Meet customers where they are today and show them how you can help them succeed in today’s changed environment.”

Two Positive Weapons to Dominate Your Market

“It’s time to use disruption and volatility as offensive weapons, and not dread their presence,” said SAC Founder Alan Weiss, PhD. “They will continue in increasing degree. Adapting isn’t sufficient—you must use them to dominate your market.”

Originally posted on SAC website: October 1, 2020

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