January Newsletter
In their book, The Discipline of Market Leaders, Michael Treacy and Fred Wiersema profiled three marketing disciplines adopted by successful companies. The gist of this book was that truly successful companies figured out which discipline they were using and made sure their efforts supported that discipline. The authors did not condone mixing disciplines. To be truly effective the company had to choose which discipline fit their operating strategy. The discipline of “Operational Excellence” produces lowest price and/or most value for the price. Henry Ford with the Model T and Wal-Mart were two examples the authors used to illustrate effective use of Operational Excellence. The discipline of “Product Leaders” produces the very best, often leading edge, products. According to the authors, Thomas Edison, with 1300 inventions and 1200 patents set the pattern for Product Leaders. The third discipline, “Customer Intimacy,” puts the customer first and focuses on providing superior customer service. Anyone who has shopped at Nordstrom has experienced the benefits provided by Customer Intimacy.
In the industrial market place, Customer Intimacy promotes working with the customer to help him achieve specific objectives, often developing solutions for a single company. For a supplier, one of the main benefits of the Customer Intimacy approach is the development of long term, very close relations with individual customers. Gem Equipment’s product line is an example of long term Customer Intimacy in action. Most items and every system in the product line were developed working closely with customers to address specific needs. In these joint developments, customer furnished knowledge includes, but is not limited to, processing, food technology, sanitation and safety. This combines with Gem’s engineering and manufacturing technology to develop solutions for the customer’s specific application. Customer input almost always improves the product manufactured by this company.
Development and improvement of batter applicators, blanchers, fryers and conveyors have all benefited from customer input. Even the use of Computational Fluid Dynamics (CFD), the technology that allows the design engineer to watch oil flow through a fryer kettle on a computer screen, was the result of customer input. In 1994, a customer suggested the use of CFD for fryer design. The first CFD program this company purchased was very basic. It could not even handle the existence of the fryer belt; the fryer kettle was treated as a flume with multiple inlets and outlets. Another customer’s Director of Engineering liked the idea of CFD but was not satisfied with the capacity of the program Gem was using. He had one of his engineers evaluate the CFD programs that were available at the time. The program that engineer chose came with a $70 thousand price tag for the program, a souped-up personal computer and training. The processor decided that the package was too expensive for them and turned the information over to this company. Gem could justify this investment because upgraded CFD had the potential to benefit all customers. A Customer Intimate relationship pays off for both the supplier and the customer.