The number of U.S. food products recalled, and the cost associated with those recalls, has nearly doubled since 2002, according to several reports. With the recent influx in food safety issues, it's no surprise the spotlight is burning brightly on supply chain management.
Fatal mistakes made by well-known brands, like Blue Bell Creameries, have called into question how manufacturers - and supply chain executives specifically - are executing two major components of food safety: prevention and response. Could it be time for supply chain executives to recall their own processes?
Some still leverage antiquated and error-prone manual techniques, while others aren't properly using the track and trace technology they have. With advancements in these solutions, supply chain executives have no excuse for not being more proactive in mitigating risks.
When it comes to reducing the number of food recalls, preparation is prevention's greatest ally. Continual process refinement paired with the proper use of track and trace technology can greatly reduce the occurrence and effects of food safety issues. Establishing automated preventative measures, including mandatory product checkpoints and quality tests during the procurement and manufacturing stages of the supply chain, can help identify issues faster and more consistently.
If used correctly, track and trace solutions can notify manufacturers in real-time so issues are addressed before the product leaves the production floor. Furthermore, accurately implementing track and trace technology into the supply chain provides you with greater visibility and actionable insight to improve pre-distribution processes. At the same time, in the event that a recall needs to be issued, track and trace technology can also quickly and easily kick-start the recall process in a more strategic manner - aiding in avoiding common pitfalls.
Let's say you manufacture a particular type of sauce and leverage a variety of outside vendors to source its ingredients. You also supply the sauce to thousands of grocery stores throughout the country. News hits about a listeria outbreak at one of your vendor's plants. Now what? Without a clear understanding of the flow of product and materials coming and going, you jeopardize your brand and the well-being of consumers.
Properly using track and trace technology can allow you to document your sauce's ingredients and suppliers while also identifying - in real-time - where sauce produced during the outbreak is located within the supply chain. This enables you to quickly determine every point of possible contamination and recall accordingly.
Seemingly simple answers to questions like where, when, and what quantities of products were shipped to and from, are being missed daily by supply chain executives. Not knowing the ins and outs of your product's lifecycle during a recall can truly cost you. In fact, according to Food Safety News, in more than half of the recalls occurring over the past 15 years, the recall cost each affected company more tha n $10 million. Some lost more than $100 million, and a few closed their doors for good because of the excess cost.
Many supply chain executives have product tracing systems, but they differ in quality based on precision and how far forward or backward in the supply chain they can track. Whether or not they can provide full control over the end-to-end process is critical to meeting compliance and maximizing efficiency.
Amidst growing consumer concern and compliance demands, increasingly more changes to the supply chain are necessary. Now is the perfect time to re-evaluate your recall processes to ensure you're using the right technology to minimize revenue losses and maximize consumer safety.
Image what would have happened if we had all been treated like adults from birth. No assistance or guidance- just expectations that are challenging to meet. We wouldn't have gotten very far, and others may have been disappointed by our lack of progress. The technology and processes we use day to day, such as our CRM programs, need the same care and attention to flourish, just as we did in our own infancy, so they can provide the best experience possible for users, customers and the company overall.
The Infancy Stage
At the very start of its life, a brand new CRM system and program will inspire energy and enthusiasm for a bright future- something really exciting has arrived. Naturally, it will need lots of attention as it is introduced. Positive encouragement will help with user adoption, and regular check-ups around data quality, compliance and usage make sure it is developing in the right direction into a healthy system. During the infancy stage, the basics of the system will be mastered- and a few late night feedings and hiccups are to be expected along the way.
The Adolescent Stage
Now that the program has been established, and users have mastered a core set of skills, it is time to start school and introduce some challenges. They absolutely shouldn't be adult-sized challenges; they have to be appropriate for the development of the program. We wouldn't ask a group of school children to read War and Peace before mastering the ABCs. This is the right time to start evolving processes to the next level of complexity in terms of steps, tasks and requirements, and asking the system to provide insight back to the business to see what has been learned.
Management should lead by example and show how CRM can be used to run the business, giving users a role model by standing at the front of the class.
Now that it has reached adolescence, the program has already been built into the culture of the organization, but there can be a danger of complacency now that everything is up, running and working for the company. it is really key that leaders, especially the executive owners of a CRM program, keep setting the homework, and the users keep turning it in.
The Teenage Years
Often known as the most rebellious years, this is when an organization needs to start showing the business value and impact of the CRM program. If the users and customers see no value, they will start questioning why they are still using the system, and whether the investment has been worth it.
Teenagers don't like to be force fed; they want to be able to challenge the system. If their bike no longer needs training wheels, despite them being there from the beginning, take them off. If a process that was introduced in the CRM program's infancy stage is no longer an efficient one, it needs changing.
This is the stage in a CRM program's life when it could become disillusioning. The glitz and glamour of a new arrival has worn off, and the daily grind has set in. The executive owners need to show they are just as invigorated and energized as the first time they saw the program, providing focus and investment, and securing user buy-in, thus allowing the program to keep moving onward and upwards.
Now that the program has reached adulthood, it's time to expand. The changes and developments in this stage will be much less radical, but will have just as much impact. They can be made according to taste and preference; for example, if you start out with a sales automation program, this is the stage at which to bring in marketing automation that would provide richer visibility of prospect relationships. And just because the program has developed into a well-adjusted, popular member of the organization doesn't mean that expansion and growth have to stop. Your industry and customers are constantly evolving, and your CRM program should evolve in sync.
How will you know when it's ready?
Just like all children, adolescents, teenagers and adults, CRM programs will develop at different times. There is certainly no set time frame as to when your program should fall into one of the above stages. The time it takes to progress and evolve will depend on how you as a business implement the changes, as well as managing the processes, technology and people along with it. It will also be based on your customer ecosystem and the speed of your industry.
There could also be a danger of rushing your CRM program to evolve before it, and its users, are ready. We wouldn't give children sharp utensils to eat with when they are very small; the same way we wouldn't equip CRM users with tools that are too advanced for the stage are at. On the other hand, the program should not be stifled when it is ready to move on. Wrapping it in cotton wool in its infancy may preserve the existing functionality, but it will be left far behind as competitors and other aspects of the business get their driving permits and aim for the horizon.
Determine Your Stage and Take Action
In order to find out what stage organizations are at regarding their CRM program, they need to go through a critical self-evaluation. Three elements that need to be considered are:
Challenging and evaluating a CRM program across the three elements above, along with the four growth stages, will help to highlight any gaps, such as the users are at their rebellious teenage stage, but the system is still in its infancy. The first goal is to make sure everyone is on the same page before taking steps forward, and then to have a clear road map to advance and evolve the entire program with all elements in sync.
Expecting a CRM program to have intelligent and well-established processes right from day one is a set-up for a disaster. Making sure it's nurtured and well cared for as it grows with your company will make sure it provides everyone from executive owners, through users, to customers with the experience and service they expect and deserve.
Staff on the frontline are the face of your company, and customer service staff in particular have the important role of putting things right when they go wrong. If a customer has a poor experience here, it could make or break their relationship with you.
Demands on frontline customer service staff are increasing as consumers expect a higher standard of response. If you cannot provide it, your customers will simply look for other companies who can satisfy their expectations. Martin Ellingham, Respond Product Manager at Aptean, discusses why empowering frontline staff ultimately results in higher standards of customer care and overall profit. It’s about staff quality, not quantity.
Today, it has never been easier for consumers to change their supplier or service provider. This has become particularly apparent in free markets in recent years, as governments have attempted to break up oligopolies of numerous industries – for example energy providers and financial services – to increase the competition and ultimately benefit consumers by enabling a wider range of choice.
In years gone by, many businesses could rely on low customer churn because it was both inconvenient and difficult to switch supplier or provider, but now it is a relatively pain free process with agencies and switching services literally knocking on customers’ doors.
With that, how a business interacts with its customers and their problems is fast becoming of greater significance. Customers don’t necessarily want to switch providers, but if they feel that inadequate customer service is forcing their hand, they will – and they won’t be coming back.
A business’ frontline is the first and the best opportunity to either reverse a negative situation or build on top of a good situation. Therefore, frontline staff need to be operating at a level that can both handle the demand and satisfy customer queries effectively in order to reduce churn and keep customers loyal.
Depending on what study you read, the cost of gaining a new customer compared to retaining an existing one is about 10 to 20 times more expensive for a business. But what many studies do not account for are the long term ramifications of losing a customer to a competitor. Consider a bank or building society; many customers will potentially be committed to one for decades. If poor customer service results in a number of customers looking elsewhere, it could leave a significant hole in a business’ long term financial projections and results.
A single click can send a bad review around the world
The challenge of providing satisfactory customer service has been exacerbated by the evolving digital landscape and how it now essentially dictates brand reputation.
Customer service departments are no longer a 9-5 operation; many are already running 24/7. The nature in which customers get the attention of their service providers has never been broader or more varied, both online and through the more traditional channels like phone calls and letters.
Now, there is nowhere for a company to hide if a customer is dissatisfied. Evidence of poor customer service no longer dies out once it has done the rounds at the coffee shop, office or gym – it lives on in the virtual world as a permanent reminder to anyone researching their next service provider.
It presents a real challenge for businesses, and has dramatically increased the reliance on their frontline staff. If customer service representatives are not adequately trained or do not have the resources to effectively handle customer interaction across several different channels, it could lead to a serious breakdown in customer trust.
As businesses have adapted to these developments, expectations have risen. We as consumers want answers quickly. We want immediate access to real people. We want them to be aware of our situation and have solutions tailored to our specific requests. No matter how strong a staff member’s personal skills might be customers always expect more. Apologies and empathy may pacify the customer in the short term – be it face to-face or digitally – but it does not solve the whole problem.
To ensure truly content customers, those skills need to be complemented with the expertise that the customer ultimately wants. Frontline staff need to be empowered with support that genuinely makes their jobs easier while providing exemplary service.
It is no longer a numbers game. More customer service staff does not necessarily fulfil customer expectations. More informed, more efficient staff – that is the answer.
Embracing technology for an efficiency drive
With this digital age comes the need for customer service staff to be technologically equipped – with technologies that really benefit their capability to keep customers happy across the ever expanding list of communication channels.
For frontline staff, there are any number of queries that they could receive via a call, email or face-to-face enquiry. It is impossible for them to know every single answer to every single situation off the top of their heads, and they should not be expected to.
But that does not mean they cannot communicate some form of useful information to the customer. A vague response that delays things further – such as “I’ll have to go and find out” – hardly inspires confidence in the customer that the business is doing everything in its power to help them in a timely, effective manner. For staff on the frontline, understanding why an issue has happened is not easy; understanding why when they are only armed with basic summary information is even harder.
By utilizing holistic Complaints Management software, the frontline – and as a result the overall business – will feel considerable benefits. This is because it truly integrates the whole setup into a manageable and easily accessible format.
It gives staff the ability to provide customers with instant updates, rather than making them wait for an answer. If the problem cannot be solved instantly, the software can streamline the redirection of a customer complaint to the correct subject matter expert. Company-wide system updates within the software can provide clarity into how similar issues have been resolved – resolution information captured at first point of contact is logged, so the customer need not wait for an answer that already exists.
For large companies whose customer service teams are spread far and wide, this kind of streamlined internal communication is vital in driving complaints handling efficiency.
By investing in the right tools which improve the frontline’s effectiveness, it will prove to customers that company profits are being reinvested into areas that will be there to help them – eradicating any perceptions that the profits are simply lining the shareholders’ pockets.
Short-term action for long-term prosperity
Businesses need to separate themselves from the crowd, and doing so means investing in customer service that exceeds the competition. Consumers have never been better informed about the products and services they use, as well as their rights, and ignoring that will be to the long-term detriment of the company.
Simply hiring more customer service staff is not the solution to improving complaints handling efficiency. In fact, adding more components to an already inefficient system will go only go towards making things worse.
The key is to identify ways to make staff more efficient. This means implementing inter-connected software systems that allow greater detail to be captured, without disrupting a slick customer-facing experience.
There is no one-size-fits-all solution, but enhancing staff capabilities through a complaints handling restructure does not have to be costly, particularly in the context of the long term gains of doing so. By working with complaints handling management experts to tailor a software infrastructure that improves frontline customer interaction, businesses will gain customers’ trust – and acquire their loyalty for years to come.
When beginning your quest to purchase an ERP solution, building a case for the cost benefit should be priority. However, focusing on all of the bells and whistles of a new ERP often overshadows looking at an actual cost benefit and understanding the overall value you are getting with your ERP. In part 3 of this blog series, we look at selecting a Best-in-Class ERP.
ERP COST BENEFIT EXAMPLES AND SUCCESSES
Best-In-Class - Set Your Business Up to be the Best
Overall, organizations need to be using as much of their ERP investment as possible. A Best-In-Class organization may have detailed plans for what they hope to accomplish with their ERP. However, if a solution that employees cannot actually use is selected, those plans become useless. According to Aberdeen Research Group’s report, How ERP Can Make Your Job Better on a Day to Day Basis, top performers will select a solution that enables users to take advantage of functionality designed to improve their jobs on a day-to-day basis.
The same Aberdeen report states that as compared to all others, leading companies are:
The bottom line is that the best-in-class invest in an ERP solution that is easy to use. Even the most functional of ERP solutions can end up being a waste of money if employees can’t use it. A user-friendly ERP solution leads to a higher adoption rate among employees and the benefits of the solution will more quickly and profoundly exhibit themselves throughout the entire organization.
Is ERP worth the cost?
One of the most common causes of delay in purchasing an ERP solution is trying to figure out which software to use. While having access to the trendiest features and functionality of an ERP solution sounds like the most obvious reason to invest, sometimes that doesn’t always make the most sense. It is up to each individual business to analyze the costs of purchase and implementation and compare it with the net annual benefits to calculate their ERP pay back opportunity. Finding the functionality that works best for your employees and empowers them to utilize all of the ERP features for better business is what’s going to pay for your system.
When beginning your quest to purchase an ERP solution, building a case for the cost benefit should be priority. However, focusing on all of the bells and whistles of a new ERP often overshadows looking at an actual cost benefit and understanding the overall value you are getting with your ERP. In part 2 of this blog series, we look at the traceability functionality of your ERP.
ERP COST BENEFIT EXAMPLES AND SUCCESSES
Traceability - Don't Let a Recall Ruin Your Brand
Food safety is all about prevention – including recall prevention and brand reputation – as well as response. Track and trace technology documents all of a product’s details in its lifecycle from ingredients to customer shipment. In addition, track and trace solutions can include built-in controls to provide manufacturers with visibility into qualified suppliers and the ability to specify incoming inspection requirements.
It only takes one bad ingredient to force a food and beverage manufacturer into issuing a recall. Tracing the ingredient fast is the key to minimizing consumer risk and protecting a company’s reputation and brand. Without an effective track and trace process, you could easily be the next brand making headlines for unintentionally causing consumers harm, thus losing more money for your business than the cost of an ERP investment itself.
Stay tuned next Thursday for part 3
When beginning your quest to purchase an ERP solution, building a case for the cost benefit should be priority. However, focusing on all of the bells and whistles of a new ERP often overshadows looking at an actual cost benefit and understanding the overall value you are getting with your ERP.
ERP enables you to automate the tasks involved in performing your business process and gives you insight into all of the aspects of your plant. ERP is an expensive investment but it’s important to understand the cost benefits of a full solution.
ERP COST BENEFIT EXAMPLES AND SUCCESSES
Data Collection - The Case of the Expensive Italian Meat
The first week after go live with their ERP, a regular customer ordered their usual type of meat from a well-known Italian meat producer. The user scanned the same meat he had been pulling for years with the data collection application in their new ERP system. The ERP’s data collection system however, failed and would not let him pull the ham. Or did it actually fail? It turned out that the reason the meat wasn’t able to be pulled was because the user had been pulling a higher quality meat at a much higher cost for several years. Thank you to the ERP’s data collection, fixing this one instance alone actually paid for the entire ERP system.
While the instance of the Italian meat may be extreme, cases like this can and will happen. However, there are several other successful ROI opportunities that pay for the cost and help your business benefit from your ERP investment.
Stay tuned next Thursday for part 2
There are a number of existing and emerging trends in the industry that will affect ERP users, buyers and implementers this year. Below are our top 3 predictions for ERP in 2016.
In the digital age, relationships between machines and people are becoming more of a mandatory need. Smart machines (i.e. smartphones, tablets, etc.) are acquiring the capabilities to perform more and more daily activities at a fast pace. Users want the flexibility to work anywhere inside and outside of the factory and have more timely and accurate information for all aspects of the business at their fingertips. The best ERP solutions will become integrated into the daily work life of a user, putting real-time information on mobile smart machines for the back office and throughout the factory. Adapting to the fast-paced user environment is critical to being proactive and empowering all ERP users to make impactful business decisions.
A system’s ability to understand its users, the tasks they perform, and their system-related goals is crucial for optimizing human and computer interactions. Users need easy access to information and the capacity to personalize necessary information for them. Repetitive and recently used tasks should be immediately available for users, rather than having to drill through different screens to find the data they are looking for. Staff should be able to perform daily tasks easily and quickly within their system. Designing ERP solutions with an experience that empowers the user is an important shift toward the new year for ERP solutions.
SUPPLY CHAIN CAPABILITIES
Specifically for the food industry and with the Food and Safety Modernization Act (FSMA) coming into play, confirming the integrity and safety of your food is no longer just an issue of what happens inside the manufacturing walls. Implementing an ERP solution that seamlessly tracks the food downstream and upstream through the supply chain will ensure that manufacturers are able to rapidly respond to a recall in the unfortunate event of a safety issue. FSMA will warrant manufacturers to take a proactive stance and dedicate necessary time and resources toward compliance planning. ERP solutions that work with customers and suppliers up and down the supply chain will help protect your reputation and your consumers.
Data is only good if you can use it. This sounds simple but metals manufacturers understand the underlying truth in this message. The challenge is taking a seemingly infinite amount of data and making it usable in a short period of time. Incorporating an analytics solution specifically tailored for the metals industry, into your ERP system will help you to turn the raw data produced by the ERP into actionable insights to help you streamline operations, increases productivity and reduces costs.
Analytics enables you to dig further into data associations from any number of data sources and make sense of what you’re looking at. It’s time to use analytics to understand the “whys” that drive your business’ success.
Examples of how metals manufacturers benefit from analytics:
The term “scrap” typically implies unwanted leftovers or rusted junk material. In the metals business however, scrap actually points to a multi-billion dollar industry around recycling and reusability. Analytics can help you to understand where and when scrap is being produced, along with other associations such as product, gauge, hardness or even operators and shifts, so that you can quickly determine where you have opportunities to recover your scrap losses, and improve your overall usage.
While scrap is one piece of the puzzle, it is important to understand all of the yield losses resulting from your process. Some losses, such as scrap or kerf losses from cutting cannot be avoided, but with analytics you can determine when and where those losses exceed standard, and most importantly determine why and ultimately take action to improve your yields. Having a streamlined solution that helps to recognize losses in production (recoverable and non-recoverable) will help ensure maximized productivity in your business.
Imagine if a car were to flip because of a piece of defective metal that came directly from your plant. Because the wreck was out of the driver’s hands, the person that owns the car will most likely sue. To prepare for the lawsuit, it is imperative to have your ducks in a row and know exactly where the faulty metal came from.
An analytics solution can dive into the details and will trace the metal back to the exact date, heat and machine it was produced on. In case of any potential recalls on a specific piece of metal, a lawsuit, or any other occurrence, having the capability to trace metals back to square one is necessary for cost savings and increased productivity. But even more important, analytics can help you understand why the problem happens, and then proactively trace down other materials with similar characteristics.
Remember “back in the day” when we actually knew dates and phone numbers by heart, read a physical map for directions or even stopped and paid a quarter to use the payphone. Thanks to digital disruption – a term coined by Forrester Research, all of this information is now at our fingertips. The phrase “back in the day” seems irrelevant because we are living fast and in the moment, always one step ahead. Technology can help us to make smarter, timelier decisions.
However, sometimes our fast-paced, digitally advanced lifestyles can create quite a bit of noise and distraction. The distraction takes away from our attention span and before we know it, we’re subconsciously moving on to the next step before even finishing the last one. As a consumer, we know we do this. As a seller on the other hand, we need to think about slowing down. That doesn’t mean get rid of distracting technology. It means understand how to use technology to your advantage with your target demographic and get back to the basics with your customers. It means ensuring that the customer experience is consistent and fluent across customer touch points. How do you get attention and attract people to your community and/or your website? Once they’re there, how do you keep them interested? You may have the tools, but consistency is the key.
Identify your customer touch points
It is critical to recognize your customer touch points by tracking your customer journey and determining the key touch points where customers connect with your brand. While there’s no one-size-fits-all list of touch points, it’s important to include points across all channels. Here is a set of examples for home builders:
|Before Purchase||During Purchase||After Purchase|
|Word of mouth||Open house opportunities||Service calls|
|Community involvement||Promotions||Follow ups|
|Advertising/Marketing/PR||Phone/Email interaction||Handwritten thank you notes|
Identifying key customer touch points and staying consistent each time provides a user experience that your buyers can appreciate. To identify the touch points that make sense for your brand, take a second to step out of your role and into the customer’s shoes. When you walk yourself through the customer’s journey and understand the total customer lifecycle – attract, sell, service - all the pieces should become pretty clear.
The easy customization capabilities of a modern CRM system can be a blessing and a curse. As simple as it is to tailor the software to a company’s unique sales process, it’s equally easy to pollute the database with data fields and expect sales reps to capture everything from a customer’s dog’s name to his favorite college football team. Once you throw in the fields that marketing and customer service organizations want to track as well, you’ll end up inundating your sales reps with a data entry nightmare they’re sure to avoid. Instead, follow these simple guidelines and let your salespeople get back to what’s most important – selling.
Understand what you want the end customer experience to be
Each brand has a different target audience and offers a different customer experience. Maybe you’re selling a quite home in a retirement community or showing a five bedroom, three bath family home in the suburbs. Maybe you’re selling a studio loft in the heart of the city. Each market requires a different experience. They key is consistency –
Gartner analyst, Brian Prentice’s report Applying Digital humanism to Customer Experience Design, published May 12, 2015 suggests that “chances are that the customer would share more information with the employee than the organization as a whole. The opportunity for an organization is to apply digital workplace strategies to empower its staff to create connections with its customers that are impossible without meaningful connections existing between people.”
Finally, please take a minute to slow down
It’s no longer “back in the day”, it’s the twenty-first century and digital disruptions aren’t going anywhere. Don’t fight against technology to stand out, work with it instead. Use technology to understand the customer life-cycle but add in a few simple, personal touches along the way, like a quick follow-up phone call rather than a standard email or maybe even a handwritten thank you note. It may be important to know the name of your customer’s dog or their favorite college football team but I would argue that it is more important to create separation from the noise by differentiating yourself. It’s important is to slow down and know what will give your customer an experience that will not only encourage them to spread the word, but will also have them coming back.
 Help your buyer find their dream home with a tailored customer experience| Residential Pros, Matt Keenan, Feb 9, 2015
Bringing Back the Human Factor to Manufacturing
In an age of increasing technological sophistication in manufacturing processes, its people are the most important and valuable resource a company possesses. The human element is what dictates true operational efficiency – that is, if it can be optimally integrated into a business’ production practices.
Uniting the people to the process
Having effective MES software is not just about trusting your staff to oversee the production processes; it is about empowering your staff with an MES that specifically spotlights their abilities and personal performance levels. This approach is known as ‘human MES’.
The Best Human MES
The best human MES solution gets operators involved from the start and makes it easy to use the system. Everyone understands the need for the system, and is in no doubt about “what’s in it for them”. Being a part of the MES solution removes any morale-sapping doubts that result from lack of transparency between factory floor and management. It also gives staff the personal satisfaction of knowing that their actions have made a sincere difference to the company.
The MES software itself should automatically:
More than Software
A human MES solution is designed to be more than just a software system. It encourages a holistic approach to refining the manufacturing processes. A human MES encourages communication and operational optimization based on the intelligence achieved through the integration of the human and the machine.