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News and comments about the issues facing today's SCM and Inventory Management professionals.
Further to my comment on October 20, 2011 titled "The Cost of Poor Management", please read the article at the following link:
http://finance.sympatico.ca/home/contentposting_reuters/steve_jobs_bio_says_apple_ceo_abhorred_corrupt_execs/32b6e2d7 I have pasted the entire article here, for your amusement. CBC News The late Apple CEO Steve Jobs - in an upcoming authorized biography - calls the crop of executives brought in to run Apple after his ouster in 1985 "corrupt people" with "corrupt values" who cared only about making money. Jobs was often bullied in school and stopped going to church at age 13, according to Steve Jobs, by Walter Isaacson, which will be published Monday by Simon & Schuster. The Associated Press purchased a copy Thursday. Advance sales of the biography have topped bestseller lists since Jobs died Oct. 5 after a long battle with cancer at age 56. According to the book, Jobs never went back to church after he saw a photo of starving children on the cover of Life Magazine. Later, he spent years studying Zen Buddhism. As a teenager, he exhibited some odd behaviours - he began to try various diets, eating just fruits and vegetables for a time, and perfected staring at others without blinking. Apple named after 'fruitarian' diet phase Later, on the naming of Apple, Jobs told Isaacson he was "on one of my fruitarian diets." He'd just come back from an apple orchard, and he thought the name sounded "fun, spirited and not intimidating." Jobs reveals in the book that he didn't want to go to college, and the only school he applied to was costly private college Reed in Portland, Ore. Once accepted, his parents tried to talk him out of attending Reed, but he told them he wouldn't go to college at all if they didn't let him go there. Though he ended up attending, Jobs dropped out of the school after less than a year and never went back. His pre-Apple job as a technician at Atari paid $5 per hour. He saw a classified ad in the San Jose Mercury News, went to visit the company and informed them he wouldn't leave unless they hired him. Jobs's eye for simple, clean design was evident from early on. The case of the Apple II computer had originally included a Plexiglas cover, metal straps and a roll-top door. Jobs, though, wanted something elegant that would make Apple stand out. Computer case inspired by kitchenware He told Isaacson he was struck by Cuisinart food processors while browsing at a department store and decided he wanted a case made of moulded plastic. He called Jonathan Ive, Apple's design chief, his "spiritual partner" at Apple. He told Isaacson that Ive had "more operation power" at Apple than anyone besides Jobs himself - that there was no one at the company who could tell Ive what to do. That, says Jobs, is "the way I set it up." Jobs was never a typical CEO. Apple's first president, Mike Scott, was hired mainly to manage Jobs, then 22. One of his first projects: getting Jobs to bathe more often. It didn't really work. Jobs's dabbling in LSD and other aspects of 1960s counterculture has been well documented. In the book, Jobs says LSD "reinforced my sense of what was important - creating great things instead of making money, putting things back into the stream of history and of human consciousness as much as I could." In the early 1990s, after Jobs was ousted from Apple, he watched the company's gradual decline from afar. He was angered by the new crop of people brought in to run Apple, and he called them "corrupt." Dream to get the Beatles on iTunes He told Issacson they cared only about making money "for themselves mainly, and also for Apple - rather than making great products." He also revealed that the Beatles is one of his favourite bands, and one of his wishes was to get the band on iTunes before he died. He got them available for sale on iTunes in late 2010. Until then, the biggest-selling, most influential group in rock history had been glaringly absent from iTunes and other legal online music services. The book was originally called "iSteve" and scheduled to come out in March 2012. The release date was moved up to November, then, after Jobs's death, to this coming Monday. Isaacson interviewed Jobs more than 40 times, including just a few weeks before his death. The book says Jobs put no subject off limits and had no control over its contents.
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Achieving great customer service is the concern of every progressive supplier.
Firms involved in manufacturing, wholesale, and other similar commercial activities encounter customer service challenges that are distinct from those one might find in business-to-consumer relationships. Ultimately it is the consumer that drives demand up through the chain, although complex sets of linkages exist within B2B commercial markets that impair realization of great customer service. In their June 2011 benchmarking report titled “Demand Management,” the Aberdeen Group (Boston) identified key criteria that distinguish Best-in-Class from Industry Average and Laggard organizations. Among the metrics was “Perfect orders delivered to customers (complete and on time),” with best-in-class meeting or exceeding a 94.6% success rate. Leading organizations share several common characteristics. They are two times as likely as other firms to measure lead time from inquiry to order, twice as likely as laggards to include promotions and other demand shaping activities into demand forecasts, and twice as likely as laggards to be able to segment demand forecasts based on key product and customer characteristics. Fundamentally, business customers such as wholesalers and retailers want to have their purchase orders delivered on time, in full, and defect-free. How might the caring enterprise work to improve its service performance? Right People, Right Place: William Blake said that “execution is the chariot of genius.” Properly align your business with your customers by assembling a team whereby employees’ skills are matched to the requirements of the job. This is particularly important in the supply chain. For example, order input accuracy – improved by web-enabled customer-supplier interfaces and EDI (electronic data interchange) – is essential. Customer Collaboration: Effective communication between supplier and customer is critical. Understand how the customer determines value. Service attributes such as speed of delivery, order accuracy, selection, packaging, security, or appearance may rank differently in the eyes of the customer. Craft an unambiguous service level contract with customers, detailing mutual expectations. Document agreeable order lead times, planning time fences, appropriate communication channels, parameters that define exceptional demand from normal fluctuations, applicable quality standards, prices, and payment terms. Develop forecasts of future demand cooperatively, across time frames that are realistic, relevant and promote realization of excellent service levels. Proactively manage orders that are at risk. Analyze customer backorder files daily, allocate inventory fairly, and disseminate future availability information efficiently. Inventory Management: Having the right product in the right place at the right time in the right quantities facilitates great customer service. Inventory management must support sales while balancing tactical investment against financial constraints and physical distribution realities. Costs of stocking out can be great, and the cost of losing a major customer catastrophic. Close the loop between supply and demand. Effective enablers include the establishment of a formalized Sales and Operations Planning (S&OP) process. S&OP reconciles supply, demand and new product plans, tying them to the business plan. Key stakeholders such as marketing, sales, manufacturing, procurement, and finance work collaboratively to produce of one integrated set of plans. Balanced Scorecard: The “balanced scorecard” has grown from a simple performance measurement framework to a full strategic planning and management system. The firm becomes viewed from four different perspectives: customers, learning and growth, financial, and internal business processes, with a set of metrics developed for each within a matrix. The importance of customer satisfaction is acknowledged. Inventory Control: Lack of inventory control inhibits great service. Control implies excellent inventory record accuracy, visibility, and saleability. Customer service operatives need to be confident that availability data is accurate, in “real time,” in order to make realistic order promises. One process enabler called “cycle counting” demands that variances between physical counts and inventory records are analyzed daily, root causes of variances are identified, and process gaps are repaired. Periodic “batch processing” of sales and operations transactions is now considered to be a substandard process, as inherent delays and inaccuracies are intolerable. Risk Management Best in class customer service providers will have well-articulated plans in place to mitigate risk in the event of natural disasters, health pandemics, political upheaval or economic disruption to ensure continued supply of critical parts to valued customers. Project Management: Seasonality can have profound impact on product demand, and focus on time lines becomes intensified. Project management skills are exceedingly beneficial in securing supply for goods that are linked to specific seasonal events or where demand varies with weather conditions. Establish appropriate milestones and monitor progress with vigilance. The following is a sidebar to my previous post about C/S, published in the September 2011 edition of Durham Business Times.
Seven Best Practices in Customer Service: Use the Strategic Plan Great service starts with the vision, and is driven throughout the firm via the mission, the statement of core values, and the strategic objectives. Simplify Replace hundreds of weekly reports, emails, directives, and advisories with a single balanced weekly scorecard. Marvin Ellis, Executive Vice President at Home Depot US contends: “reports don’t buy hardware; customers do, so I want our associates focused on customers.” Focus Make the consumer a priority. Customer-facing retail store employees should focus on three top fundamentals: merchandise in stock, store appearance, and serving customers. Treat customers as friends and guests. Invite them into your home. Work Force Management In their June 2010 benchmarking report, the Aberdeen Research Group found that Best-in-Class retailers adopt formalized Workforce Management (WFM) techniques to drive the notion of customer centricity throughout the enterprise, increase staff productivity, centralize task management, and decrease overall labour costs. Measure Develop appropriate metrics to track improvement over time, results relative to plan, and results relative to Best-in-Class performers. Performance indicators might include percent in stock, percent positive feedback, complaints registered by category, or sales improvement. Customer feedback can be directed into aspects which might include store ambience, issue resolution, friendliness, ease of communication, or product knowledge. Help customers complain Each complaint is a learning opportunity. Ensure complaints are promptly recorded and categorized for root cause analysis. Open friendly lines of communication via telephone, a web site, or in person. Acknowledge complaints quickly. A customer who is frustrated when trying to lodge a complaint may be lost forever. Customers might not always be right, but they always deserve a response. Have a recovery plan Mistakes happen. Design and articulate a plan to recover. Retaining customers is critical, and turning a disgruntled one into happy one can accelerate sales. Act with the highest sense of urgency when the system fails. Understand the problem, and ask the customer what can be done to make the situation right. |
AuthorJohn Skelton is the Principal Consultant and founder of Strategic Inventory Management. Archives
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