Tag Archive: Amazon

Interview with Fender Guitar Executive

February 7th, 2020

Can people and robots work side-by-side? It seems to be the hot topic lately.  Fender Guitar’s Senior VP of Operations, Ed Magee and I talked about talent, technology and transition after the Manufacturing Summit. At Fender, skilled craftsmen and craftswomen are critically important.  Yet, Fender also automates where it makes sense. Technology working hand-in-hand with your #1 asset, your people, can assist in improving the craftsmanship, as well as safety. Ed considers training and development to be a key to success.

We also talked about potential recessions and disruption. Certainly, in today’s Amazon-impacted environment with global volatility, there will be continued ebbs and tides to navigate. Ed mentioned the importance of creating community and flexibility. Invest in your employees during times of boom AND bust. Don’t be afraid of the cycle and keep the lessons in mind as you think through your business cycle, and you’ll future-proof your manufacturing operation. Maintain focus, don’t cut back on training and development when everyone else does and you’ll be likely to speed by the rest.

Watch our interview to learn more and gain a few insights. What are you doing to future-proof your manufacturing operation and related supply chain? What should you be doing? Ed and I concur. If you aren’t starting with your people, nothing else will matter.

No matter how high tech key clients go, the most successful and sustainable clients accompany high tech with high touch. You’ll gain some strategies for people in our Profit through People archives as well as with our new LMA-i, LMA-Intelligence series, Future-Proofing Your Manufacturing & Supply Chain. Contact us to discuss further.

 

 



Amazon Kicks off the New Year by Creating Disruption

January 30th, 2020

According to a Bloomberg article, Amazon kicked off the New Year by creating disruption. They have abruptly stopped buying products from some of their wholesalers, looking for ways to bypass wholesalers or push the cost to down the chain and increase profit. If your business depends on Amazon, hopefully you have been future-proofing your manufacturing and supply chain operations.

If not, you might be in a world of hurt! With that said, if you are heavily dependent on any one customer or supplier, you are in a risk-ridden situation.  It makes me wonder whether FedEx’s move away from Amazon was brilliant or whether they took on too much risk moving away from Amazon. Listen to a recent video where I refer to this topic. Are you taking these types of strategic questions into account in your 2020 plans?

What Should We Consider and/or What Impacts Could Arise?
Although the impact is obvious to wholesalers cut off by Amazon, the impacts are more widespread than that. Will Amazon be able to go direct to manufacturers? Will they be able to increase profits by squeezing their supply chain without impacting service? What happens, if that isn’t as easy as it appears? Will customers just wait? Are they getting too big or will other e-commerce players have an opportunity? It will be interesting to see.

In addition, no matter if you are related to this industry or not, it will impact you! If new players become involved, the manufacturing and logistics footprints will evolve. Will you be ready for opportunities? Undoubtedly, we will be impacted by changes in logistics infrastructure, rates and service requirements. The question is whether we will let this happen to us or if we will proactively address it. It might be too late to future-proof against this particular move by Amazon, but there will be countless more changes coming by Amazon as well as many other disruptors. Will you be ready to navigate changing circumstances and market conditions for a positive customer and bottom line impact or not?

At a minimum, continually re-evaluate your supply chain road map and think through related impacts. These topics certainly relate to our new LMA-i, LMA-Intelligence series including the Amazon Effect, the Resilient Supply Chain and Future-Proofing and contact us if you’d like an assessment path-forward plan to accelerate your bottom line and customer performance.



Will Amazon Pass UPS & FedEx?

January 26th, 2020

According to a CNBC article, Amazon is already delivering half of its packages. It appears that Amazon is on target to pass by FedEx and UPS. They have had distinctly different strategies. FedEx curtailed its contract with Amazon in early 2019, and Amazon just retaliated by not allowing 3rd party sellers to ship via FedEx. On the other hand, UPS is doubled down with Amazon. Which will turn out to be better in the long run? And, as we know, USPS has been delivering packages for Amazon behind-the-scenes. Could they come out on top?

Or will Amazon just crush everyone? In recently touring the Ontario airport (the powerhouse in package shipping), it is clear Amazon has a long way to go to catch up in air freight but they are also known to speed by competitors. Amazon is slowly making inroads to ocean shipping as well. No matter who you think might win this race, if you ship or receive anything, you should pay attention!

What Should We Consider and/or What Impacts Could Arise?
Simply think about Sears. They were Amazon prior to Amazon entering the scene. Unfortunately, they didn’t keep up with changes occurring, and they are largely out of business. That annoying but not worrisome competitor might just speed by you if you aren’t staying relevant!

Additionally, from a supply chain and logistics point-of-view, there are substantial impacts. With the sheer relevance of the last mile, transportation infrastructure, customer perceptions, technology advancements and much more are becoming relevant. Undoubtedly, no matter your industry, it will be impacted since everyone relates to logistics. Not only logistics, but many industries relate to oil and gas prices or would be impacted by delays in materials etc. The impacts are widespread and substantial. Have you thought through your strategy and positioning based on these factors?

At a minimum, continually re-evaluate your supply chain road map and think through related impacts. These topics certainly relate to our new LMA-i, LMA-Intelligence series including the Amazon Effect, the Resilient Supply Chain and Future-Proofing and contact us if you’d like an assessment path-forward plan to accelerate your bottom line and customer performance.



Should We Listen to all the High Tech Talk?

January 22nd, 2020

Client Question
Should we pay attention to all this high tech talk? Certainly it seems like everyone and their brother is talking about artificial intelligence, the internet of things, and even the use of technologies such as virtual reality and autonomous vehicles. And this is aside from mundane topics such as ERP systems. And,  we need to function on a daily basis. We need to serve customers and deliver value to the bottom line.  And, we prefer to only get distracted when necessary.

The Answer
We have seen clients get carried away with the latest and greatest technology fads. Although it was an interesting personal education, it typically didn’t result in a return on investment. On the other hand, we have also seen clients ignoring technology that becomes vital to survival in their industry. After all, it is easy to do. When Sears used to be the Amazon of the age, no one thought they would be going out of business.

So, as usual, the answer is “it depends”. You must pay attention, learn about and invest in technology so that you can make a good decision on which to pursue and which to ignore for your go-forward business strategy. If it were easy, we would all be successful for 100 years running.  There are VERY few companies in this position. Do you have a position or a person who is dedicated or allocates part of his/her responsibilities to this role? If you don’t call it out, it will fall by the wayside. This should be similar in concept to an R&D/new product focus. Why should we focus only on new products and not new technologies?

Food For Thought
No two clients are alike. Some ask us this question and it is an obvious,: YES, you must invest to stay relevant and increase business value. For others, it is an emphatic, NO. Why waste resources on additional technology when we haven’t implemented or used the available systems capabilities that will move the business forward? As it seems to go in business, it is usually the best executives and CIOs who are on top of their technology road map who ask these questions. The rest won’t even invest enough to find out where they should prioritize limited funds so they don’t become the next Sears!

At a minimum, once you get to a certain size or complexity, the minimum you should do is upgrade your ERP system so that you have a modern technological backbone and can scale up quickly as needed. With that said, it is rarely enough if your goal is profitable growth.

If you’d like a technology and ERP systems assessment, please contact us. At a minimum, read our numerous articles and get started in evaluating your situation!

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Future-proofing Your Manufacturing Success

December 11th, 2019

One of our core roles is to pay close attention to trends, issues and opportunities that will impact our manufacturing and distribution clients so that we can give them a leg up on the competition.

Lately, we have noticed that the next “big thing” will be future-proofing. Although everyone seems concerned about potential recessions in one of the greatest periods of growth ever on record, that isn’t why we have chosen to focus on the topic of future-proofing. Instead, what we have noticed is that the future is simply unknown.

It has an equal or better chance to be ideal for growth. Yet clients will not be able to take advantage of the opportunity if they haven’t been future-proofing their business and customer base. Also technology is a big unknown. Certainly waiting on the sidelines for someone else to figure it out will not cut it! In today’s era of the Amazon Impact, the Skills Gap and the need for a Resilient Supply Chain, your future will still not be secure if you haven’t thought about future-proofing. So, we are excited to launch our next LMA-i, LMA Intelligence topic, “Future-proofing Manufacturing & Supply Chain

As we explore this new strategic topic, we always start with the fundamentals. It does not matter how much you spend on the latest and greatest, energy efficient windows for your house if your foundation is cracked, letting in air and sinking. People must be your foundation. No matter how high tech your company, it must be accompanied with high touch.

Have you taken a step back lately to evaluate your people?

  1. Do you have the right players on your team?
  2. Do they understand where they are going and why?
  3. Do they have a coach, mentor and/or adviser?
  4. Are there opportunities for career progression for key roles?
  5. Have you identified your stars and have a fast-track program in place?
  6. Are you recognizing your team?
  7. Do you have bench strength?
  8. Is your team prepared for where you are going currently or are they thinking about where they need to be in a year?
  9. How about your customers, suppliers and trusted advisors? Do they understand their value and how they can contribute?
  10. Are you willing to invest in people before investing in equipment and technology? Why or why not?

To future-proof your manufacturing business, you must know these answers. Of course knowing the answers is not sufficient. Is your team on board? How about your supply chain partners? Moreover, as unfortunate as it seems, being smart isn’t enough. You must apply this knowledge in a way that enables you to successful navigate the future while continually creating scalable, profitable growth.

Stay tuned for more articles on this topic and contact us if you’d like to assess your situation.

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