Technology and globalization continue to redefine the relationship between manufacturers of complex industrial equipment and their consumers. With worldwide supply chains driving down cost, loyalty to local manufacturers and distributors has waned, even when consumers are purchasing complex, big-ticket items. High-tech innovations such as leaner manufacturing, the standardization of parts and other production elements, and new delivery methods are turning expensive sold-to-order equipment into commodities. All of this has led to a lack of differentiation between manufacturers, and it makes them struggle to add value and service to their production of complex machines to remain competitive.
“Top line growth comes from becoming a solution provider,” says Brett Anderson, Regional Manager for I.B.I.S. , a Norcross, GA-based Microsoft® consultancy which specializes in the implementation of business productivity software for the manufacturing industry. “Manufacturers of heavy machinery, construction rigs, transportation equipment, and large electrical systems no longer boost their sales figures on product quality alone or through geographic loyalties. With those factors having changed so dramatically, and with prices having flattened on products and parts through lower labor costs in the global paradigm, loyalty is derived by keeping clients engaged and providing customers with benefits that extend beyond the products themselves.” Anderson says, “Customer satisfaction and commitment is now synonymous with customer service.”
Complex manufacturers continue to sell through relationships – perhaps more than in the past – but, according to Anderson, “The definition of what constitutes a good and productive relationship with a customer has almost completely changed. Now, the most effective top line results come with the manufacturer being aware that large equipment purchases affect all parts of the customer’s business, including all of the diverse parts of their balance sheets.” “One method of building good relationships which increase revenue,” says Anderson, “is to improve the customer quote. When a client is in the process of making a purchasing decision, providing them with a quote that contains up-to-the-minute information delivered as accurately and quickly as possible throughout the complex purchasing cycle is guaranteed to help the sale.” “This,” says Anderson, “helps to inform customer decision-making and begins to establish a chain of communication that engenders loyalty.”
Anderson goes on to state that, “Customer service is also bolstered by bringing together all of the complex elements of the production process in an effectively cost-managed, with clearvisibility. When customers can see for themselves, across the build, that a product is being actualized through best practices which will increase the ROI on the item – for example, using modular, standardized parts that are easier and less costly to replace, through lower costs shipping and buying methods for parts, or with custom features that really adhere to specific business requirements – they feel more comfortable doing business with the manufacturer. In this case, even considering today’s cost-consciousness, with alternative information about pricing and other options readily available over the web, price is not the sole object of the purchase.”
According to Microsoft® , “Success in the manufacturing industry requires producing the right products, in the right quantities, at the right time, with good quality, and at a price the customer is willing to pay.” Anderson agrees, making the analogy of building a house, “If you decide to have a new house built, you’d be willing to pay a little more to get it built three months earlier, as long as you knew it would be built faster at the same level of quality.” In Anderson’s words, “accelerating a quality build process helps customers see the value of the products that they are purchasing and makes them willing to pay what becomes the price instead of what is dictated to be the price. They are also made aware that rapid completion reduces the risk of costs that are added to the product when the build cycle would otherwise have been extended.” Returning to the homebuilding comparison, Anderson says that, “Reducing the time to construct a well-built house minimizesthe risk of unanticipated contractor and additional materials costs for the the customer. This is exactly the same for the industrial equipment build process.”
In addition, technology has reshaped business communications. According to Anderson, “Manufacturer’s customers expect immediate, accurate, transparent responses about the very complex products that they are purchasing. Whether it is a request for up-to-date pricing, for a view into changing CAD designs, for parts, labor and delivery altermatives during the build and installation processes which affect the overall price of the item, or for choices of custom modifications which can dramatically affect cost and time-to-delivery, consumers have become used to getting the information right away. Today, the ways in which communications are made also have to be molded to the ever-changing business environment and evolving media. In today’s landscape, phone calls, faxes, and even email is being taken to the next level with updates made by SMS and production images sent by MMS over smartphones, by alerts over web dashboards, and with video meetings directly from the manufacturing floor.” Anderson asserts that, “Those manufacturers who are forward-thinking in their communication methods are able to foster closer relationships with their customers that, as with other factors already mentioned, build loyalty, repeat business and referrals.”
Collaboration is the next building block of an effective customer relationship strategy. Anderson says, “Among the most important aspects of manufacturing and consumer purchasing,is the need , and ability to, provide different teams working together no matter what their role in the cycle may be. Imagine, with the new communications tools that exist, a parts fabrication vendor in Europe or Asia, collaborating in a live session with the manufacturer’s shipping vendor in one part of the U.S., and a production manager and the customer’s purchasing executive in another part of the U.S., all of them viewing live data about shipping alternatives that can affect a specific deadline, and with each contributing live updates to the database which is viewable by every stakeholder. This sophisticated interaction could result in the purchasing or production executive’s ability to provide real-time updates to their CEO, CFO, or shareholders about when a product will be available to meet the needs of the customer’s clients.”
“The challenges for many manufacturers in pulling together all of the elements of a customer quote, in providing transparency during the build process, in sourcing and purchasing materials, in controlling shipping costs, and in inviting data and design collaboration, as well as anticipating the needs for, and selling, often highly profitable post-support services, are that, historically,“this information has ‘lived’ in different pockets,” says Anderson. Anderson and his team at I.B.I.S. see this problem well-addressed with software. “There are highly business-intelligent software solutions in the marketplace which help manufacturers create a communications platform that supports the fostering of more effective relationships with customers that keep them buying. Many of them contain advanced tools to aggregate data and to present it in a manner, and at a speed, that gives customers confidence. If the manufacturer is working off of the same set of data for quoting, customer service, the supply chain, and field service, and can make it securely available over almost any media, they can reduce risks, control costs, control production and delivery timeframes, and concentrate on and more efficiently build post-sales.”
In Anderson’s words, “A number of software packages exist which can help manufacturers better automate production processes, combine complex data, and represent data clearly; thus, giving them systems that can help them to sell more now and in the future. The issues with those solutions are their high base cost, that the solutions are typically disparate, and, most of all – because they are uncommon – the customarily long learning curve required to adopt them.” “Microsoft has changed that playing field,” says Anderson. “Microsoft sees enterprise software as an expansion of familiar platforms—they take what most people use in their day-to-day business lives and add features that make the platform robust enough to support an entire industry’s fiscal, productivity, and communications cycle. For example, for industrial equipment manufacturers, Microsoft® Dynamics® AX is a business productivity tool that contains built-in functionality which supports the build process by enabling the manufacturer to share with vendors, as early as possible in the cycle, all key information about what they need from them. Suppliers, shippers, fabricators, etc., can collaborate in a system which uses data that is all housed in the same place. This extends to the shop floor, where the same software and database can schedule human resources, materials used, and the path and time to build complex equipment.” “What is most important, however,” according to Anderson, “is that, for example, the resource allocation and scheduling system is Microsoft® Project, but with Dynamics AX providing a bigger, multifaceted, and industry-configured database behind it. Therefore, everyone involved is accustomed to the tool, even with all of its new capabilities, reducing the amount of additional training time required for the manufacturer’s teams to use it.”
Microsoft also addresses new methods of communication with customers. “It provides,” says Anderson, “one single set of data deployed over the web, wikis, discussion threads, portals, smartphones, and more. Using the same, albeit a diverse, method of communications with employees and suppliers, the manufacturer can supply data to, and directly collaborate with, the customer to enable them to see the progression of designs, sourcing, building, customizing, and shipping. This can be achieved using a native web interface for self-service through the Internet Explorer browser, providing complete visibility into the product lifecycle. The manufacturer can push live information directly to the portal regarding whether the build process is on schedule, or an estimated ship date, rather than making a phone call. This has twofold benefits: it increases customer service value while reducing the burden on manufacturers to spend unnecessary time on compiling or delivering data. For the manufacturer’s sales teams, they spend less time on the phone or getting back to the client and can concentrate on better serving clients and selling additional or new products and services. This makes customer service more accurate, more robust, and fundamentally friendlier, while leaner, leading to increased levels of service and enabling the manufacturer to disburse resources across the organization and use them more effectively. For the customer, they spend less time calling the manufacturer because they can easily access the data that they need from the web in any location. This makes the customer happier.” Anderson says, “If you keep a customer engaged in a positive purchasing experience throughout the lifecycle, they come back, buy more and tell others.”
1 I.B.I.S., Inc. is a multidisciplinary Microsoft® solution provider which has twice been honored as Microsoft U.S. Partner of the Year, and in 2007 as Worldwide Microsoft Partner of the Year (for Microsoft® Dynamics® GP).
2 “Why Microsoft Dynamics for industrial-equipment manufacturers?” http://www.microsoft.com/dynamics/en/us/industries/industrial-equipment.aspx. Copyright © 2009-2010 Microsoft Corporation. All rights reserved.
Copyright © 2010 The Nurture Institute™. All Rights Reserved. Unless otherwise noted, all materials contained in this document are copyrighted and may not be used except as provided in these terms and conditions or in the copyright notice or other proprietary notice provided with the relevant materials.
Tags: Customer Service, Industrial Equipment Manufacturing, Microsoft Dynamics AX
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