Digital Transformation in Manufacturing

What does digital transformation look like in manufacturing, particularly ecommerce? That’s a huge question. Answers will vary widely depending on your industry and the unique challenges and opportunities facing your company.

However, across industries, manufacturers looking at digital transformation have one thing in common: they must become customer-centric in the digital age. That’s why we talk about digital transformation in terms of customer experience (CX). In this article, we’ll hear from 6 experts on the topic of digital transformation in manufacturing–all from the perspective of customer experience.

CONTENTS:

I. Customer Empathy: Sam Bayer, Corevist

II. Consider eProcurement: Brady Behrman, PunchOut2Go

III. Meet Customers On Their Terms: Scott Perdue, Configit

IV. Optimize The Digital Channel: Brandon Kim, Oro, Inc.

V. Define Priorities: Richard McCammon, Delego

VI. Consider The Long Term: SangWon Um, NTT Data Global Solutions

I. Lead Your Team To Greater Customer Empathy: Sam Bayer, Corevist

1. We’re hearing a lot about digital transformation these days. What are some first steps manufacturers can take to transform their customer experience?

The very first step is to understand why you’re going on this journey. There are all kinds of bad reasons to do it. You shouldn’t do it because you’re told to, or you’re shamed into it. Rather, you should do it because this is what growth means for your company moving forward.

Let me expand that first step a little. It’s not just understanding why, but also committing to the journey. In order for this journey to be sustainable, you can’t be chasing a fad. You have to be chasing a cultural change in your organization. And it starts at the top. No low-level employee or middle manager can actually commit an organization to digital transformation. It really has to come from the top.

That’s how we know who’s going to win and who’s going to lose moving forward. You need senior executives to drive it. Do they really get it? Do they really want it? Do they really understand what it’s going to take to make it happen?

Without that, any first step is really a misstep. It won’t stick. That’s the most important thing–the executive understanding, and the executive commitment.

That’s all pretty high-level, so let me zoom in a bit. Practically speaking, you need to create a prioritization based on the business goals. Which initiatives should take precedence? Is the focus on efficiencies, or growth? Have you established a priority matrix to compare those initiatives that are high return, low effort, against those that will be long, expensive projects with low return? This matrix will look different at different companies. Every business has different priorities.

2. What’s the #1 customer experience challenge manufacturers are facing in 2019?

The manufacturers we work with face a ubiquitous challenge: they need to segment their customer base. On top of that, they need to treat the segments individually, because each one has its own unique requirements when it comes to customer experience.  

That’s the big challenge manufacturers face: starting a project without a conscious intent to account for the needs of different segments. Instead of meeting the needs of these segments, manufacturers often subconsciously cater to one segment alone–the B2C market. Now that’s not a bad thing, since entering the B2C market forces manufacturers to build their brand. And yes, it can absolutely generate more revenue for products that fill a consumer need. But for manufacturers, focusing on the B2C segment alone may be shortsighted. It may leave behind the needs of your established B2B customers.

The key is personalization. Not in a marketing or promotional sense, but rather, personalization in what kind of customer experience you provide. Rather than creating one “master customer experience” influenced by B2C and expecting all segments to buy in, manufacturers should create a separate experience for each segment–and personalize it to the needs of that segment.

In other words, align each online ordering experience to the needs of that customer segment. For B2C, yes, you need to provide rich content, product reviews, and so on. But for your established B2B buyers, they may get irritated if they have to search through a catalog to add items to the cart. In fact, they may even have repeat orders that they want to punch in fast or upload from a CSV. In that case, you might consider a B2B portal that supports that kind of ordering, rather than forcing them to use a catalog that’s meant for consumers.

Yes, we’re hearing a lot about the “consumerization of B2B ecommerce” these days. But it’s not for 100% of your customers. Important, yes, for the right segment; but for the wrong segment, it’s actually a waste.

So to fill out the #1 challenge in customer experience a little more: It’s not just segmenting your customers, but understanding their needs, then putting together a roadmap of rollouts to meet those needs in a way that’s personalized to each segment.

3. What can executives do better to instill passion for customer experience across the organization, even as their employees grapple with the challenges of digital transformation?

This is hard. It’s a culture question.

The way the question is written is wonderful, but it implies where to look for the answer, and I don’t think you’ll find the answer there. It implies the executive has to do something better to instill passion for customer experience. I don’t think executives can instill passion in employees. What they can do, what they should do, is let their team swim in the same pool as their customers. Get them out on the frontline. Not just the obvious employees like CSRs and Sales, but everybody. That means your warehouse people, your marketing people, your IT people, as many as you can get to engage with your customers. Circulate those stories within the organization. When you put empathetic employees in the presence of your customers, listening to their stories, their pain, walking in their shoes, your employees become even more empathetic. They become customer-centric.

Wow, how do you do that?

At Corevist, we use customer focus groups to facilitate customer-centric empathy in our clients’ employees (and in our software). In the process of implementing a solution for a client, we run focus groups with our client’s customers contributing. That ensures the client’s employees have the opportunity to mingle with their actual customers. It exposes the client’s employees to the customer experience as it really is today. It makes our software ideally tailored to your real customers’ needs, and it opens the eyes of your employees, too.

Executives must create the environment and process to facilitate this, and executives have to model it; but they can’t instill it. Really, the question assumes a top-down methodology. In my experience, that’s just not how it works. As soon as the leader is gone, the posters come down, and you realize nothing got embedded into the DNA of the organization. The only way to fight this is to get your people on the front lines, experiencing life as it is for your customers.

II. Accomodate Customers’ eProcurement Platforms: Brady Behrman, PunchOut2Go

To learn more about PunchOut2Go, visit https://www.punchout2go.com/.

1. We’re hearing a lot about digital transformation these days. What are some first steps manufacturers can take to transform their customer experience?

Ecommerce is a practical first step. Manufacturing businesses have been slow to digitize. Approximately 80% of US manufacturing businesses process purchase orders by hand. That’s understandable in an industry that relies on personal relationships between buyers and the manufacturer’s sales team. However, digitization can play a crucial role in improving the customer experience. And, far from damaging the collaborative relationships between buyers and manufacturers, digitization helps both parties to streamline the procurement process while enhancing collaboration.

An eCommerce store allows buyers to browse products and make purchases at their convenience, reduces manual order processing, and is the foundation of further digitization efforts, such as punchout catalogs and automated data exchange with buyer backend platforms. eCommerce needn’t depersonalize the relationships manufacturers have with their customers: in fact, an eCommerce store can be tailored to meet the needs of individual buyers, giving each buyer a personalized customer experience.

2. What’s the #1 customer experience challenge manufacturers are facing in 2019?

As supply chains grow more complex and organizations seek to find cost efficiencies in the procurement process, they embrace eProcurement and spend management platforms. One of the biggest customer experience challenges facing manufacturers is integration with buyers’ back-end eProcurement platforms.

eProcurement platforms help businesses to implement accountable procurement processes, reduce error-prone manual labor, and consolidate procurement and spending data for analysis. But to realize the full potential of eProcurement, buyers need suppliers with the ability to integrate with the platform for automated data exchange. The alternative is to manually process every purchase order and invoice.

Integration is a struggle for manufacturers, especially those without the resources to develop custom integrations compatible with their customer’s back-end platforms. Manufacturers who are proactive where eCommerce, punchout, and platform integration are concerned have a competitive advantage over those that cannot provide the automation buyers demand.

3. What can executives do better to instill passion for customer experience across the organization, even as their employees grapple with the challenges of digital transformation?

Executives can instill passion by focusing on how digital transformation provides tools that help employees to provide a positive customer experience. Typically, employees want to offer the best possible customer experience, but the digital transformation can disrupt their understanding of what a positive experience looks like and their role in providing the best possible service. In reality, digitization, and automation in particular, enhance the customer experience, while at the same time relieving employees of repetitive manual tasks and allowing them to focus on giving customers the experience they deserve.

III. Break Down Silos To Meet The Customer On Their Terms: Scott Perdue, Configit

To learn more about Configit, visit https://configit.com/.

1. We’re hearing a lot about digital transformation these days. What are some first steps manufacturers can take to transform their customer experience?

Breaking down the silos.  Many manufacturers’ IT landscapes have matured into rigid silos of systems and work streams. Engineering doesn’t talk to Sales.  Sales tools don’t consider manufacturing. Services teams don’t know what was engineered, manufactured, or sold. This all hurts the customer.  To break down these silos and offer the customer an experience that is represents an aligned view of the product offerings across the four pillars of the organization (Engineering, Sales, Manufacturing, Services) is a great place to start.

2. What’s the #1 customer experience challenge manufacturers are facing in 2019?

I speak from a complex and configured product perspective, but I think a lot of manufacturers are still struggling to offer customer experiences on the customer’s terms, instead of the supplier’s terms.  Customers are often forced to communicate their needs based on the manufacturer’s terminology and view of the product instead of the customer’s view–often described as the application view of the product (AKA, “How will this product be used?” instead of, “how will this product be engineered and produced?”).

3. What can executives do better to instill passion for customer experience across the organization, even as their employees grapple with the challenges of digital transformation?

Stay focused on the customer.  Continually communicate to the organization how the products and services they offer are making the world a better place, solving customers problems.  Everyone enjoys helping others. If we keep our people focused on how they can help our customers, it will help fuel the transformation.

IV. Optimize The Digital Channel: Brandon Kim, Oro, Inc.

To learn more about Oro Inc., visit https://oroinc.com/. 

1. We’re hearing a lot about digital transformation these days. What are some first steps manufacturers can take to transform their customer experience?

One of the very first steps manufacturers can do to start their digital transformation is start putting their products online. Manufacturers have typically done business the old-fashioned way (typically through word-of-mouth or referrals). However, the digital age has changed how buyers look for manufacturing partners and having your manufacturing catalog available and searchable on the web will be paramount.

2. What’s the #1 customer experience challenge manufacturers are facing in 2019?

With the popularity of B2B eCommerce only increasing, setting up a well-thought out customer experience for the online channel will be a challenge in 2019. That’s because companies will need to manage different customer groups that may have different pricing agreements. In addition, different catalogs may need to be showcased making the experience for each customer unique.

3. What can executives do better to instill passion for customer experience across the organization, even as their employees grapple with the challenges of digital transformation?

Executives can create metrics around improving the customer experience–whether that’s an NPS score, feedback survey, etc. Tying compensation around these metrics for reaching higher goals could help foster passion for CX and make things less ambiguous.

V. Listen To Customers (Then Define Priorities): Richard McCammon, Delego

To learn more about Delego, visit https://www.delegopayments.com/. 

1. We’re hearing a lot about digital transformation these days. What are some first steps manufacturers can take to transform their customer experience?

Listen.  The single most important thing a company can do when transforming its business is listen to the needs and desires of the target audience — in this case, the customer.  Customers always have great ideas on what works for them. Use these ideas to plan and deliver successful ways to interact with the customer.

2. What’s the #1 customer experience challenge manufacturers are facing in 2019?

Customers each have unique needs.  Distilling these needs into solutions for customers is a tremendous challenge.  One can never be everything to everyone and so determining which solutions work best for the largest audience is a daunting task.

3. What can executives do better to instill passion for customer experience across the organization, even as their employees grapple with the challenges of digital transformation?

Lead by example.  If executives are passionate about the transformation and the positive effects it will have on customers, this passion will permeate the company.

VI. Plan For The Long Term: SangWon Um, NTT Data Global Solutions

To learn more about NTT Data Global Solutions, visit https://www.nttdata.com/. 

1. We’re hearing a lot about digital transformation these days. What are some first steps manufacturers can take to transform their customer experience?

I am based in Japan, and many of my clients are in traditional manufacturing business and focused on business-to-business. For many of my clients, manufacturing is at the very core of their business and is considered the most important function in the business.

Sometimes, it is quite challenging to initiate going digital from a customer experience perspective. There are initiatives in a factory setting, such as IoT, digital factories, and so on. Recently, quite a few clients have shown interest in customer experience, using a business-to-business sales platform.

I think important first steps are for manufacturers to gain awareness about the benefits of transforming customer experience. IT investment is not just an expense item; it can actually bring tangible ROI to the business and demonstrate that enhanced customer experience can actually help increase sales.

2. What’s the #1 customer experience challenge manufacturers are facing in 2019?

Most of my manufacturing clients have excellent customer service teams in place. However, many rely on traditional tools and systems. To keep the high level of customer service, they would have to rely on people’s hard work.

This is 2019 and technology is changing very fast. Thus it would be wise to take advantage of technologies that improve customer experience. It might not be possible to catch up with everything; however, it would be quite beneficial to have the right tool in place which would significantly help reduce human effort and the possibility of human errors. The resulting business process should require less effort and produce a better result.

Also, when considering the right tool, it is better to focus not just on the near future, but also to keep the long term in mind. The methods adopted to improve customer experience should be sound long-term investments.

3. What can executives do better to instill passion for customer experience across the organization, even as their employees grapple with the challenges of digital transformation?

An executive must have a vision for providing excellent customer experience, especially utilizing the amazing technologies available today.

In contrast, employees have a tendency to avoid changes and keep the status quo. They might have some idea of getting better with changes, but they might not be crystal clear about what it is.

An executive can provide vision and educate employees. Shift the focus from the challenge of digital transformation to the benefit for them and going further for the client. In turn, that benefits the company and, eventually, all individuals within the organization.

It is easier said than done, but an executive-level position can influence employees with pressing the right button, giving the right message to them.

Moving forward: FREE demo

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