What is likely to define 2016? Volatility and Intimacy

Perusing the 2016 prognostications, especially for the manufacturing industry, I stumbled across Brad Kuvin's recent editorial entitled, "One Word Likely to Define 2016: Volatility." Brad is the editor of MetalForming Magazine, a publication of the Precision Metalforming Association (PMA*).

From Brad: "I'm hearing it repeatedly: Production volumes and order frequencies are wildly fluctuating, as unpredictable as ever. For metalformers, this is pushing fliexbility and responsiveness to the forefront. Consider this quote from Buckley Brinkman, executive director and CEO of the Wisconsin Center for Manufacturing and Productivity:"

"(Manufacturing production) is more volatile than it's ever been...Everybody is trying to shorten their supply chains and make them more responsive to the market and to the end consumer."

So I riffed on Brad's editorial title a bit and expanded his volatility forecast to include the opportunity: "intimacy."

In the year going forward, for those in the manufacturing supply chain — especially metalformers — there are ways to mitigate volatility in the marketplace with simply having integrated business systems (like ERP and CRM) and good management practices in place.

We find that our metalforming (and other) new manufacturing customers come to xTuple due to being overwhelmed with disjointed systems to manage sales, contacts, inventory, accounting, workflow processes, and other valuable data. They imagine the time and money they'll save with manufacturing and distribution processes integrated into a single, consolidated business system.

Savings such as

• Reducing the time it takes to close a month
• Reducing the number of days to close sales
• Speeding up order throughput
• Improving the time it takes to get cash in the door
• Improving the percent of orders delivered complete and on-time
• Improving growth in operating margins year over year

But there's more, much more.

Brad continued: "As demand seems to change direction as often as the wind, accurate forecasting becomes critical to ensuring suppliers (metalformers) remain profitable as they 'go with the flow.' This means that metalformers, in the midst of a volatile market, need to snuggle up more closely than ever to their customers. They also must strive to expand their knowledge regarding their customers' customers."

So Brad suggests that suppliers in this marketplace need to study their customers' markets, especially how production schedules will impact said customer. Ultimately he hits the customer service mark straight-on with his "snuggle up" euphemism.  

Customers crave intimacy, and your business relationship with them has to entail more than just a website, whether you “take orders” online, or not. No, manufacturers are not Amazon. But have you looked at Amazon.com recently? Amazon does much more than just take orders today. Amazon’s wildly successful customer services are tightly integrated with all of their company, customer and product information, setting a high bar for customer expectations, including manufacturers who haven't tradtionally been thought of as digital or online companies.

Manufacturers need an easier way to improve intimacy with every “customer” — End users, Distributors, Sales Agents, virtual Employees, and more — and early successes point to using Web-based solutions integrated seamlessly (in real-time) with their business systems.

Yes, conducting business transactions and building relationships via the Web — from the simplest to the most complex — is a competitive advantage over traditional "brick-and-mortar"-only storefronts. Every business, including manufacturers and distributors, can be more successful using digital experience technology to better serve their customers.

* PMA is the 900-member trade association representing the $137-billion metalforming industry of North America — creators of precision metal products using stamping, fabricating, spinning, slide forming and roll forming technologies, and other value-added processes. Its nearly  companies also include suppliers of equipment, materials and services to the industry.

Photo credit: Barnshaws Metal Bending Ltd on Flickr