Create Space, Create Agility, and Create the Future

by business901

Monday, April 12, 2010 at 06:53 AM EDT

In Engineering Live I read an interesting article titled, "How manufacturers can prepare for post-recession profitability." David Hatrick, a technology and innovation consultant with PA Consulting Group in Cambridge, UK, recommends that manufacturing companies adopt a three-pronged strategy in order that they can emerge from the downturn as winners. His strategy is: create space; create agility; and create the future.

Create Space: Hatrick says that creating space can yield savings in two ways: "In our experience with clients across a number of sectors, optimising the product cost through a combination of improved design and focusing on the supply chain can deliver savings of between 10 and 20 per cent. Secondly, reducing complexity across the product range, with reductions in SKUs and raw materials/components, can have a significant impact on direct costs as well as making savings in support functions such as procurement and R&D." It is relatively straightforward to identify potential savings, but the reality of implementation means that typically two-thirds of this forecast saving will achieved.

Create Agility: Agility needs to be created both in the supply chain and in the way the manufacturer innovates. "Companies with CDS (customer-driven supply) at the heart of their supply chain strategy design their supply chain to win the customer at the point of use or the point of sale; the upstream supply chain is designed back from that point," explains Hatrick

Create the Future: In order to create a profitable future, manufacturing businesses need to focus on identifying and developing strategic growth platforms, and boosting the productivity of their innovation activities. To develop future growth platforms, it is vital to understand the new realities for customers and consumers.

The article goes into much greater detail and is written from an English perspective but is well worth the read. It brings to mind a book that I just recently finished  The Deciding Factor: The Power of Analytics to Make Every Decision a Winner.In this book, it talks about the need to effectively use the analytics available but more importantly how it is used to make decisions.  A quote from the review by Dave Kinnear "the Rational Taoist" sums it up:

The authors use several high-profile companies to put together case studies demonstrating the value of analytics or how the absence of analytics caused poor decisions to be made. They point out that there are several societal trends which require us to change our business models.

• An increasingly Cashless Economy enables Tracking of More Customer Data
• Multiple Companies Sharing Data About Customers they have in Common
• New Technologies being developed to Enable the Use of Unstructured Data
• Obtaining Data from Social Networking sites
• Companies from emerging Markets Competing for their Share of Consumer spending

Both the book and the article goes into detail that these customer metrics are becoming ever more important as we move to the the world of what I call Marketing Singularity. Without automation and good analytics and even more important the understanding of the sea of data we may severely hinder are organization's future.

After reviewing these articles, I realized I have drifted away from my Six Sigma Marketing thoughts in my blogging and what better tools are there to help us understand all the data and analytics available to us. 
I still use Voice of Customer, Voice of Market, SIPOC and a host of other tools not only help us understand data but help us distinguish what data is important to us.

Summing it all up...Creating our future may be all about how effectively we use and interpret the data available to us. 

This article originally appeared on Business901.