Ben Kerford | February 6, 2019
Provocative Opening Statement Alert!
By and large, manufacturing as an industry is well behind the engagement, commercial process and digitization curve compared to its vertical peers. Simply put, manufacturing organizations have yet to adapt to the change in experience their partners not only expect, but demand.
Did this statement hit too hard? I hope not. Let me explain.
The world has changed for manufacturing organizations, specifically those using partners. This is not so provocative. We likely agree that the business climate has changed for EVERY business over the years, but why do manufacturers seem to be impacted the most? Why are margins thinning? Why does the partner experience not improve? Where is the shareholder value? Why can’t my partners sell more? Why do my partners work with other vendors?
My hypothesis is this: The legacy mindset of hyper-focusing on extracting cost versus creating value, coupled with the “Amazon effect” on B2B buyers, has left manufacturing organizations that sell through an indirect channel pondering, not solving, these questions. Partners wanted more enablement, preferably on-demand. End customers got smarter because of more readily available information. Product competition grew and the market landscape got more crowded. In this new world, the buying and service EXPERIENCE really mattered! Partners started to stray to the few that were getting it right.
While many recognized the challenges ahead and what needed to be done, it was hard to break the cycle. They tried, but fell into the same traps:
The above are are perfectly fine ideas, and, in fact, are incredibly valuable. Cost optimization and product innovation are great and selling direct is a lovely route to market, but do they answer the previously proposed questions that manufacturers are grappling with today? Do they move the industry up the maturity curve? I humbly submit they do not.
But there is good news, too! Manufacturers are in an enviable position when it comes to:
So, I will pose my own question and offer an answer:
How can manufacturing organizations create a partner experience that addresses the changing expectations that require anywhere, anytime access to information and data?
Community-led engagement with your partners and customers.
Manufacturers need to look beyond relationship management and focus on creating a new style of partner experience. One that:
I realize this solution creates a new question to ponder:
How could I possibly manage the rising cost and complexity of these increasing demands through a community-centered solution and drive real return?
It’s a great question.
Companies doing this well focus on the top value drivers and most critical partner audiences. They actively avoid being all things to all possible audiences. They engage their target channel partners through tactics like performing regular voice-of-the-partner surveys to collect feedback that they then act on. They identify the efforts that will drive the most quantifiable value. They leverage the data, content and relationships they have.
Then they use these inputs to improve:
And they track, measure and report. And, finally, they stop investing in what is not showing a return.
My “where to start” advice is select the item that will have the biggest impact, then build on that foundation by choosing tactics that create long-term stickiness.
In closing, manufacturers will continue to lag unless they adapt. A consistent, data-rich experience is the new baseline, with even greater demands on the horizon. Manufacturers will soon be required to serve more predictive data to partners. Cognitive technologies and machine learning applied to the vast data sets will be expected to deepen relationships and provide insights that create a competitive advantage. The time is now to march up the maturity curve, before the gap is insurmountable and only the adaptive survive.
Post contributed by Ben Kerford, Senior Vice President of Business Consulting and Manufacturing industry expert at 7Summits.
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