Tag Archive: Amazon effect

Future-Proofing Your Customers

February 13th, 2020

Have you thought about future-proofing your customers? In thinking about future-proofing your people, it makes sense to start with your customers.

The statistics are staggering. According to Outbound Engine, acquiring a new customer can cost five times more than retaining an existing customer. We wouldn’t be surprised if the actual cost is far greater if direct and indirect costs are combined. It certainly should give us pause. How do we future-proof our customers?

One way is to focus on the Amazon Effect and providing lighting speed delivery and tirelessly differentiated service. There is no doubt customers expect more. The bar gets higher with each passing day. Thus, we must be ahead of our customers to take a proactive approach to providing a superior customer experience while being cognizant of profitability and working capital.

How will you know what your customers see as differentiated service? Start by listening. Observe your customers and see what might provide value. Ask questions and tailor your solutions to be special for key customers. Find ways to provide these differentiated services while proactively managing the process efficiently and effectively from the internal point-of-view.

To accomplish this feat, it is wise to keep in mind that you are only as good as your #1 asset, your people. We have yet to meet a client with unhappy employees and happy customers. Start by getting your house in order. What do your employees need to be successful? It is more than a training course or occasional pat on the back. Do they know they are making a difference? Are they empowered within reasonable guidelines? Do they know leaders value performance and are willing to address the tough topics?

Investing in employees is the best way to future-proof your manufacturing and supply chain. Expand your thinking on people to your trusted advisors, customers, suppliers and other business partners.

Are you taking the time to ensure a prepared yet agile end-to-end supply chain? Remember, the people within the end-to-end supply chain count in providing an exceptional customer experience!

If you’d like an assessment of where you should invest (time, resources, money) to deliver lightning speed delivery and tirelessly differentiated service, contact us. There are also plenty of free articles and resources on our website. Let us know your thoughts and questions.

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Manufacturing Expert, Lisa Anderson, Gauges Last Decade Advancement to Position the Next

January 31st, 2020

CLAREMONT, CALIFORNIA – January 29, 2020 –  Manufacturing and Supply Chain Expert,  Lisa Anderson, MBA, CSCP, CLTD, president of LMA Consulting Group Inc., reaffirms that advancements in manufacturing during the 2010’s has positioned manufacturing for exponential growth in the 2020’s. LMA Consulting Group works with manufacturers and distributors on strategy and end-to-end supply chain transformation to maximize the customer experience and enable profitable, scalable, dramatic business growth.

“There was so much advancement going on in manufacturing during the last decade that it is almost a blur.  The Amazon Effect, Skills Gap and Digital Revolution have all uniquely impacted manufacturing and the supply chain,” Ms. Anderson comments.

The Amazon Effect has pushed manufacturers to accommodate ecommerce-like orders – more frequent and smaller.  Rapid delivery has also become the new normal.  “The Amazon effect highlighted the need to raise the bar on the customer experience. 24/7 accessibility, customized product and service with a quick turnaround and easy returns have become commonplace, creating a shift in inventory strategy and an increased interest in advanced manufacturing,” she said.

The Skills Gap has grown over the last decade, exacerbated by the low unemployment rate.  “Manufacturers are in a perfect storm, the Baby Boomers with a significant knowledge-base are retiring at the rate of 10,000 a day.  That, coupled with the advancements in technology that have changed the types of jobs in the sector, make it difficult to find the right people with the skill sets needed,” she noted.

The Digital Revolution transformed manufacturing. “There was little ramp up to 3-D printing, IoT (Internet of Things), Artificial Intelligence (AI), Robotics and Automation.  It was almost like one day they were proven and appeared.  This took many by surprise and was a little intimidating.  Yet, those who have taken time to integrate digitization into their organization are already seeing results,” she said.

In 2020, the customer experience and future proofing manufacturing and the supply chain will fast-track proactive manufacturers to stand ahead of the competition and position them for exponential growth. “There are opportunities to export. And, while in the last decade we thought outsourcing overseas was the answer, the trade wars and tariffs along with recent requirements that China put into place has been giving manufacturers pause. Future-proofing requires looking at the business at 360° and driving change,” she concluded.

Ms. Anderson was recently appointed to the Department of Commerce, District Export Council of the Inland Empire. Her collection of 2020 Predictions from Manufacturing & Logistics Executives will be released in February 2020.

About LMA Consulting Group – Lisa Anderson, MBA, CSCP, CLTD

Lisa Anderson is the founder and president of LMA Consulting Group, Inc., a consulting firm that specializes in manufacturing strategy and end-to-end supply chain transformation.  She focuses on maximizing the customer experience and enabling profitable, scalable, dramatic business growth. Ms. Anderson is a recognized Supply Chain thought leader by SelectHub, named a Top 40 B2B Tech Influencer by arketi group, 50 ERP Influencer by Washington-Frank, a top 46 most influential in Supply Chain by SAP and named a top woman influencer by Solutions Review. She recently published, I’ve Been Thinking, 101 strategies for creating bold customer promises and profits. A regular content contributor on topics including a superior customer experience with SIOP, advancing innovation and making the supply chain resilient, Ms. Anderson is regularly interviewed and quoted by publications such as Industry Week, tED magazine and the Wall Street Journal.  For information, to sign up for her Profit Through PeopleTM Newsletter or for a copy of her book, visit LMA-ConsultingGroup.com.             ###

Media Contact
Kathleen McEntee | Kathleen McEntee & Associates, Ltd. | p. (760) 262 – 4080 | KMcEntee@KMcEnteeAssoc.com   



SIOP for Revenue Growth & Predictability

January 16th, 2020

We have received quite a few calls lately with the underlying theme of revenue growth and predictability. And, it got us thinking: Doesn’t every executive want revenue predictability and growth? Certainly the successful ones do!

If your revenue is difficult to predict from week-to-week, month-to-month and year-to-year, it might be time to think about how to design and implement a SIOP (sales, inventory and operations planning) process that will deliver these results for your business.

Similar to lean, the SIOP methodology alone is useless. Perhaps worse than useless because it might get your hopes up. On the other hand, if you think through how to design and implement the process so that it “works” in your business and supports your bottom line results, it might put you over that stretch target of revenue growth, profitability, or working capital effectiveness. At a minimum, it will align your resources and bring clarity and predictability to the situation so that you know which levers to push or pull to drive results.

How does SIOP enable revenue predictability?

  1. Demand plan: It starts with a demand plan. Once you align all sorts of disparate inputs to your sales forecast (within your organization, with your customers and supply chain, with the market and with your data and information), you will have the best view of your demand plan feasible.
  2. Supply plan: Since you align your demand plan with your supply plans (staffing, overtime, machinery, equipment, storage, supply base), you are much better equipped to deliver the demand plan with high levels of customer service and profitability.
  3. Metrics: SIOP incorporates the monthly review of key metrics related to demand and supply, so all relevant parties remain aligned on critical data points and progress.
  4. Continuous feedback: Since there are weekly activities with a monthly cadence, as business conditions change, any relevant and noteworthy changes and nuances are naturally incorporated into the plans and visible to all relevant parties.
  5. It’s about people; not data: As the EVP of Operations at Fender Guitar says in our interview below, it is all about the people. Although clients typically worry about syncing up data sources (which has to be a part of the process), the most important part of the process is to align people. Once Sales, Marketing, Business Development, Customers, R&D/New Product Introduction, Operations, Finance, and Suppliers are aligned, suddenly all the data concerns disappear.

As executives are concerned about potential recessions, impacts of global volatility, the Skills Gap and the Amazon Effect, future-proofing their manufacturing operations and extended supply chain is on their mind. SIOP is one way to future-proof your business so that it remains predictable while minimizing risk and maximizing outcomes.

Why not consider a SIOP assessment to fully understand your potential? Following the assessment, conduct a pilot SIOP process to see the what benefits emerge.  The value will become clear. If you’d like assistance to stack the deck in your favor with this process, please contact us.

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Manufacturing Expert, Lisa Anderson, Confirms Manufacturers Focused on Customer Experience Drivers

December 21st, 2019

Manufacturing Expert, Lisa Anderson, Confirms Manufacturers Focused on
Customer Experience Drivers

 CLAREMONT, CALIFORNIA – December 19, 2019 –  Manufacturing and Supply Chain Expert,  Lisa Anderson, MBA, CSCP, CLTD, president of LMA Consulting Group Inc., confirms that manufacturers are flexible and responsive to changing customer needs and demands. LMA Consulting Group works with manufacturers and distributors on strategy and end-to-end supply chain transformation to maximize the customer experience and enable profitable, scalable, dramatic business growth.

“2019 has been a pivotal year for manufacturers.  As turbulence with tariffs, the need to provide immediate response to customer needs and demands and improvements in automation have required capital investments, manufacturers that have responded are coming out ahead. They are near-shoring, reshoring, customizing and focusing on sales forecasting almost to the point of being predictive of demand. And, they are leading in their respective industries,” Ms. Anderson commented.  Nimble response has not traditionally been a term associated with manufacturing.  Artificial intelligence, robots, IoT and 3-D printing have become more mainstream and allow manufacturers to make immediate improvements and reduce lead times.  “We see manufacturers excited about future adaptations of their products, processes and services as well as their collaborations with their extended supply chain to create innovations and make a greater impact,” she said.

The customer experience drivers, awareness of the Amazon effect and the need for a resilient supply chain are messages that Ms. Anderson focuses on when working with clients.  “It’s about differentiating the customer experience while enabling profitability and growth. It may seem that these are diametrically opposed.  Yet, when a collaborative focus with a commitment towards innovation takes place in an organization, great things happen.  Our clients are feeling the impact. Recently, we worked with a client to help them initiate a vendor managed inventory program for their customers, managing the inventory and ordering process.  This allowed for better insight into the extended supply chain which helped them proactively position inventory and build more agile capabilities.  The result was better response to changing customer demand patterns, establishing resiliency in the supply chain and, most importantly, achieving bottom line performance, ” she concluded.

As the calendar rolls to 2020, customers will continue to become more sophisticated and demanding.  The recent squabble between FedEx and Amazon is proof that even the largest of client relationships can change.   In 2020,  future proofing manufacturing operations and the supply chain will fast-track proactive manufacturers to stand ahead of the competition.  Initiatives to position manufacturing are underway, especially in Inland Southern California where Ms. Anderson is involved with the Inland Empire Economic Partnership which is developing a consortium for advanced manufacturing and logistics success. She is also active with the Manufacturing Council of the Inland Empire where she heads the Innovation Awards for the Annual Summit.  “Manufacturing remains a core industry in the U.S. The time is right, and the time is now to focus on future-proofing manufacturing and the supply chain for success” she concluded.

About LMA Consulting Group – Lisa Anderson, MBA, CSCP, CLTD

Lisa Anderson is the founder and president of LMA Consulting Group, Inc., a consulting firm that specializes in manufacturing strategy and end-to-end supply chain transformation.  She focuses on maximizing the customer experience and enabling profitable, scalable, dramatic business growth. Ms. Anderson is a recognized Supply Chain thought leader by SelectHub, named a Top 40 B2B Tech Influencer by arketi group, 50 ERP Influencer by Washington-Frank, a top 46 most influential in Supply Chain by SAP and named a top woman influencer by Solutions Review. She recently published, I’ve Been Thinking, 101 strategies for creating bold customer promises and profits. A regular content contributor on topics including a superior customer experience with SIOP, advancing innovation and making the supply chain resilient, Ms. Anderson is regularly interviewed and quoted by publications such as Industry Week, tED magazine and the Wall Street Journal.  For information, to sign up for her Profit Through PeopleTM Newsletter or for a copy of her book, visit LMA-ConsultingGroup.com.           

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Media Contact Kathleen McEntee | Kathleen McEntee & Associates, Ltd. | p. (760) 262 – 4080 | KMcEntee@KMcEnteeAssoc.com                                                 

 



Top Trending Client Request: Reduce Inventory

October 7th, 2019

More than 50% of client requests in the last several months have related to inventory. In fact, it seems to be a trending hot topic! In today’s era of the Amazon Effect where customers expect more and have ZERO patience to wait, there are challenges like a volatile environment with tariffs and concerns about space, costs and more, more inventory is needed to grow the business yet businesses cannot afford it. Learning how to reduce lead times and improve service levels while reducing inventory and costs is of utmost importance.

In partnering with several clients on just this topic, we’ve found the same ingredients to success yet the mix and proportions can be quite different. Several of the top contributors behind inventory success include:

  1. Demand planning: It turns out there is a lot to be said for fine tuning your demand plan (sales forecast). How well do you understand your customer requirements? We’ve seen that even in the best of clients, there is a gap between perception and reality. In 80% of our clients, there is a path to significantly improve the forecast with a direct correlation to inventory reduction
  2. Production &/or material planning: Not surprisingly, there is no ‘magic process’ that works for every client.  However, there are general themes that are identical. In every case, there is some sort of logical combination of master scheduling/material requirements planning (MPS/MRP) and kanban processes. How we figure out the right mix, proportions and formulas is the trick. It depends on the manufacturing/distribution type, people, processes, systems, customers, suppliers and related capabilities and more.
  3. Distribution planning: Similar to production and material planning, we’ve seen a significant opportunity with several clients to leverage a more proactive yet simpler distribution planning approach. The process will involve concepts from DRP (distribution requirements planning) and kanban. Often, this simple process can provide the visibility required to better manage inventory levels.
  4. Lead Times: Certainly, none of these can be viewed in isolation. Customer lead times will dictate the requirements of your network, whereas supplier lead times must be built into your planning processes. Distribution lead times and options (mode of transportation) could also make the difference between OTD (on-time delivery) or OTIF (on-time-in-full) and late delivery as well as profit and loss.
  5. Capacity: Understanding your capacity (skills, labor, machinery, space, and more) and how it relates to your requirements is of paramount importance. This process of aligning demand with supply across your organization and supply chain is termed SIOP (sales, inventory and operations planning).

In our experience, clients can reduce inventory by 20-30% on average without negatively impacting customer service. In fact, we often find that a win-win-win can be created: improved service, inventory turns and cost/margins simultaneously.

Read more in an upcoming article I’ve written for Distribution Trends.  Feel free contact us to discuss your situation in detail.

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