Satisfying customer demand may look easy — especially with today’s technological advancements.
The truth is that providing what the customer wants is not easy. This is because the whole process is completely broken.
A few examples to explain this point:
- Feature Creep — too many options that the customer does not care about. Why do companies add on features that do not add value to the customer? Because they have this misconceived notion that they know better. In reality, the customer just wants her problem solved — completely.
- Over promising, Under delivering — this is a very dishonest and rampant behavior. It is akin to conman ship. Luring potential customers with obviously misleading promises amounts to illegality.
- Stock obsolescence caused by ordering goods without due regard of the needs of customers. Such inventory is costly due to carrying costs and money tied up in stock.
- Stock outs invariably lead to customer dissatisfaction. When you do not find what you were looking for, you are more likely to seek it elsewhere. Not only are stock outs lost sales opportunities — they may result in customers loss.
- Over marketing a product or service without a corresponding improvement in quality. This unnecessary expenditure does not add value and eats into scarce resources.
- Mass production mentality where everything must be BIG — big production batch sizes and equipment.
All these situations point to the need to change from mass production paradigm. But moving to a lean setup fills the traditional industrialist with horror. They feel that it will cost more to be lean.
A few companies have taken the challenge head-on and are starting to reap the benefits.
Going forward, only the companies that learn to provide value to their customers will survive.