Jul 21, 2009 | Demand chains, Management, Marketing, Operations, Sales
How long will it take for the politicians in this country to forge an acceptable compromise amongst all the interests in the carbon debate, and take meaningful action.? Probably forever, and we will end up with the proverbial camel after all the compromise, and that will suit nobody.
Enter the game-changer!
Wal-Mart, the biggest retailer in the world by far, turning over more than $US450 billion, more than most countries, has changed the game. Last week, they announced they would put carbon footprint information on display labels for all products sold in their stores. Suppliers will be required to assemble the information from their supply chains as part of their trading relationship with Wal-Mart
No recommendations, just the information, and consumers can make up their own minds.
The implications are mind-boggling.
In one decision, by one company, the nature of the debate about climate change has been turned from one seeking a political, emotional and academic compromise to a very simple choice for the Wal-Mart supply chains, do it or face deletion from their largest customer. Multi-national suppliers, Colgate, P&G, Unilever, Mars, and many others, will suddenly have another marketing lever to use in their marketing activities, across the world. Suddenly, weasel words in media grabs from pollies are even less meaningful than they usually are.
In Australia, Woolworths follow closely the steps taken by Wal-Mart, and what better way to put added pressure on its arch-rival Coles.
Suppliers to Woolies had better get ready!
Jul 9, 2009 | Management, Operations, Sales, Strategy
Selling is a tough job, and getting tougher, as the number of ways a potential customer can purchase expand with the web, and consumer confidence is fragile, despite the stunning Australian figures a couple of days ago.
No longer can sales people fulfill their budgets by being accurate and sympathetic purveyors of information, and doing a lot of calls, they now need to be able to add value in ways that competitors and no other channels can duplicate at the price.
How do you do this?
- Have only skilled sales people, ones who without thinking, empathize with customers and their problems. Make sure they know your products intimately, and the business of the customers as intimately so they can identify unique ways your products can add value to the customer.
- Have in place the sales support mechanisms so that every opportunity identified is optimized. Sales people make sales talking to customers, not chasing late orders through your systems.
- Have a “sales culture” where the whole organisation recognises that customers are the reason they are in business, and it is everyone’s job to sell, not just those with a bag.
The bad news for sales professionals is that there will be less of you as time goes on, the good news for those left is that they will be paid a lot more than they are now as their value is recognized.
Jul 9, 2009 | Management, Marketing, Operations, Strategy
Yesterday, some astonishing figures reflecting consumer confidence were published by the Melbourne Institute and Westpac, with the attendant clichés about the success of the governments actions coming from all parts of the government,applauding the “cash-splash” in alleviating the impact of the WFC.
What a load of old cobblers.
Over a long period we have allowed, indeed, encouraged the reduction of our productive capacity in favor of the “production” of services, accepting the line that all economies move from agricultural to industrial to services in a linear fashion as they develop, and it was our turn to move to services.
Apart from the lucky ability of Australia to dig stuff up, and sell it, once, we produce less and less.
I do not accept that the future of Australia is in providing intangibles, when we dig up stuff, export it, and re-import the manufactured product that we should be manufacturing ourselves. Where is it a given that this should be so? I am not suggesting a return to protectionism, quite the contrary, we need to be globally competitive and resilient value adders and exporters of our own resources.
Our future should be in using the productive capacity of our educated, market aware, globally tuned workforce to manufacture stuff and then to export it. There is a radical idea for you.
But where are the engineers, and scientists, the technical skills to do this? The technical and scientific skill base of the economy has been eroded in favor of other “soft” skills that do not produce “stuff.” All you have to do is look at the technical brain drain overthe last 20 years as scientists look for remuneration and facilities to match their capabilities, or the disparity in remuneration between a financial derivatives salesman and a Phd in applied mathematics for your evidence.
We need to take a long view, and start to wind back the clock, because in that long term it will not be the puffery of consumer confidence that keeps this country great, but the skill to conceive, design, manufacture and export tangible assets that have at their core the leveraging of the intellectual capital of the country.
Jul 7, 2009 | Management, Marketing, Operations, Strategy
Much has been written about the value of giving people as much information as possible about the organisation, including any unwelcome news. In the absence of certaint, rumor will fill the gap, and it is usually worse than the actual.
I was reminded of this recently having a yarn over a meal with a bunch or people I worked with some time ago, who were facing the reorgansation of the business subsequent to a takeover, and the probable redundancy of many of them.
As GM of a division of this business, I had closed a number of operational sites to increase the returns of the business. In the first, I followed the corporate policy exactly, turned up on the morning with a letter for each employee, a redundancy calculation, and the HR manager and security. Suffice to say it was not pleasant, and there were repercussions.
Some time later, I had to close a second plant, same reason, it simply was underperforming drastically, and had become surplus to the need. This time, I called a meeting, and told the personnel of the decision 6 months in advance of the planned closure, explained the reasons, and the steps that would be taken to ensure they all had as much of an opportunity as possible to move to other sites, or find other jobs. To my surprise, they were pleased that finally they knew their fate rather than being forced to speculate on it, and the timetable. In the following 6 months as operations wound down, productivity went up, attendance went up, product losses went down, and the financials improved markedly.
The lesson, once people know what will happen, and when, why, and how it will impact them with some certainty, they were able to get on with the job without the corrosive impact of uncertainty.
Jul 2, 2009 | Demand chains, Management, Operations
Supply or Value chains are essentially sequential, one activity logically follows the completion of the one prior, and in streamlining the timing and handover parts of a process, you can build great efficiency.
However, great leaps in performance will not come from incremental improvement in a sequential process, but from finding ways to complete activities in parallel, but this will require a whole different set of collaboration tools, to ensure that each parallel activity is working towards the same end point, using information that is consistent and complementary.
The exchange of information through the chain becomes absolutely essential as you move to reduce the cycle time and costs of activity sets in a chain by re-engineering the chain to progressively adopt parallel activities. Without essential information being far more freely available that is necessary in a sequential chain situation the whole exercise will be a disaster.
Simple first steps taken to “parallel process” can offer great improvement, but more importantly, they can be an indicator of what is possible, and a precursor of the sorts of information sharing capabilities that will be necessary to capture the promised performance improvements.
Jun 29, 2009 | Management, Operations
These terms are often used interchangeably, often in my experience muddying the waters in situations where clarity is required.
Efficiency is all about how well you use the status quo, productivity is more about how you leverage gains to be made from changing the status quo.
Controlling costs of a process (efficiency) is far easier than figuring out how to make the process better (productivity), and in the long run is nowhere near as useful.
