CRM Benefits to the Manufacturing Sector

Manufacturing Benefits from Data Warehousing and CRM Solutions.

Apr 28, 2009 Duane Sharp

Each industry sector achieves benefits from top-notch CRM solutions and in manufacturing the benefits are in product development, refinement, forecasting, and promotion.

Successful data warehousing projects and CRM Solutions in the manufacturing sector have achieved a number of definable and measurable benefits in operational areas, including the nine described below:

  1. Analysis of Supplier Quality
  2. Analysis of raw material costs to determine alternative sourcing strategies
  3. Product Forecasting
  4. Product Recall
  5. Distribution Logistics
  6. Customer Satisfaction
  7. Product Development
  8. Product Refinement
  9. Promotion Events

By tying finished product quality back to the supplier, problems can be corrected at the source. In a number of manufacturing sub-sectors, suppliers are expected to access the manufacturer’s data warehouse to improve delivered quality. Enabling global purchasing managers to leverage global prices against local suppliers can result in significant cost savings.

Reacting to Unusual Shortages and Creative Placement of inventories

The formal systems for managing this function on a day-to-day basis can be supported by the data warehouse, which provides information needed to react to unusual shortages, strikes or demands. Single instances such as the E. coli bacterial dumping of millions of pounds of meat can pay for the data warehouse with a single use. One manufacturer identified a problem with a valve and fixed the majority of products that were still in inventory, avoiding damage to consumer’s homes.

The quantity of product in standing inventory in the consumer goods manufacturing industries is estimated to be in the hundred billions of dollars. More creative placement of inventory, better forecasts, and reduced shipping time can mean significant savings in inventory costs. Many retailers deduct a penalty fee from manufacturers’ invoices if the product is not delivered at the time when the bay in the warehouse dock is assigned. Shippers are really another supplier to the manufacturer, and management of their quality is critical. The actual deduction and the cost of handling are measurable items.

Coincidental Product Usage

Identification of coincidental product usage can identify the need for a brand-line extension. For example, examining detailed purchases of cake mixes established the need for a frosting product to accompany the existing cake mix.

If failures on a disk drive on an airplane are higher based on take-off and landing plus environmental conditions such as heat or salt air, investigations and engineering evaluations can be conducted to reinforce or determine whether more inspections or other maintenance procedures are required at the manufacturing level to avoid complete failure.

The most effective promotion events can be determined, considering shelf price, advertising, in-stock position and competitive activity.

Justifying Data Warehouse Growth

If the data warehouse and the CRM solution are successful, they will grow rapidly and new users will bring new information to the warehouse to support their information needs and to benefit their manufacturing business. The combination with the existing data will enrich every user’s information experience.

Most organizations in the manufacturing sector spend months of staff resources attempting to justify the initial data warehouse and subsequent CRM solution expenditures, and then become complacent, immersed in the technology and its projects. When the usage grows and the system grinds to a halt, corporate management may challenge requests for more capacity. This issue can be addressed by using periodic reviews to monitor progress against predetermined business objectives to ensure they are met and that they continue to support the manufacturing operation.

The copyright of the article CRM Benefits to the Manufacturing Sector in Business Management is owned by Duane Sharp. Permission to republish CRM Benefits to the Manufacturing Sector in print or online must be granted by the author in writing.
CRM in Manufacturing, photorack CRM in Manufacturing
   
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