2.3.1.3 Management tools
While electronic management of manufacturing functions such as maintenance offers big cost and time savings, the greater strategic value may lie in the new options electronic information provides to executives. For example, collecting plant data centrally also facilitates the ability of managers to assign work based on which plant can deliver the quickest response time or the lowest cost of production at a particular point in time. Consider how you could improve the handling of the increasing turbulence in electrical utility rate structures, says Metcalf. By pushing data from circuit monitors and PLCs scattered across multiple plant sites to a central location, companies now can do a better job of assigning energy expenses to individual cost centers, analyzing energy usage trend data, and assigning orders to plants to take advantage of hourly fluctuations in utility rates.
Metcalf cites the example of a major consumer products manufacturer that expects 10% to 15% annual energy savings viaWeb-enabled information gathering. A side benefit is the improved allocation of energy costs among individual process lines. Another Metcalf example is a major tier-one automotive supplier that is using the Internet to automatically collect and log all utility data-including water, air, gas, electricity, and steam-in a single integrated database. Data is collected in 15-minute intervals and automatically uploaded to a centralized data warehouse where it is manipulated and analyzed by the local utility as a value-added service. Among the reports the manufacturer now receives from the utility are statistical energy-usage reports, totalized flow analysis, costs by energy source, aggregation of multiple meters, and a monthly report on total energy costs per facility.
eManufacturing calls relentless attention to connectivity challenges and it should come as no surprise that automation vendors translate this into opportunity. Two vendors, GE Industrial Systems and Cisco Systems Inc., were inspired by their respective factory-automation and Internet-networking prowess to form GE Cisco Industrial Networks. Their rationale was neatly captured in the June announcement by Lloyd G. Trotter, president and CEO, GE Industrial Systems: “While companies have connected their office systems, partners, and customers, the factory floor-the heart of manufacturing -is disconnected from the rest of the enterprise.” GE Cisco’s operating presumption is that “all the proprietary protocols that are out there will ultimately one day be gone and be replaced with Ethernet-based, open standards architecture based on TapNet that will enable everything to talk to everything else.”
2.3.1.4 Culture change
Success in Web enabling the factory also hinges on the work culture’s familiarity with e-business, adds Metcalf. A company that isn’t using the Web for purchasing, for example, is unlikely to embrace the idea of e-enabling its plants. Manufacturers should start small and build the success that will bring support. GE Cisco thinks the greatest culture challenge will be in closing the cultural chasm between IT and the production floor. Don’t downplay this challenge, advises Norrington. “They don’t speak the same language, they’ve got different budget dollars, and they have different agendas.”
Metcalf suggests building the strategy on IT’s need to demonstrate that what they do supports the corporation’s business objectives. Security is the issue highlighted by ARC’s Hill: “Many plant managers and engineers believe the plant floor must be kept ultra secure. The thought of an e-business implementation bringing instructions from outside the plant via the Internet can seem very foreign.”
2.3.1.5 eManufacturing Summary
The challenges of e-enabling manufacturing also are changing automation vendors. One example is Rockwell Automation, Milwaukee. “Ten years ago we would have been categorized as a product company, but today the products happen more as a result of solving a business problem,” says Joe Kann, vice president, global business development. “By accelerating control and information integration projects, our manufacturing customers are requiring more and more consulting services,” says Randy Freeman, vice president, global marketing. “With the emergence of e-business we’re having to relate technology and products to enterprise-wide strategies. We’re in boardrooms explaining how we can solve business problems as much as we find ourselves sitting in the plant manager’s office just talking about manufacturing.”
2.3.2 CRM
Today the availability of econometric, demographic, lifestyle and psychographic data, decision support systems, the Internet, and other customer access techniques are helping marketing and senior management make customer care a reality rather than just a vision. Companies no longer want to treat their customer base as a homogeneous collection of revenue generating units; they want to get up close and personal with each of them individually.
Providing exceptional customer service through effective CRM is essential to business success. Quality CRM systems ensure rapid responses to all customer inquiries and are designed to boost sales and demonstrate your active concern for customer satisfaction. CRM is a comprehensive sales and marketing approach to building long-term customer relationships and improving business performance. The best CRM systems include:
· Comprehensive account management functions
· Contact profile, history and n-tiered relationships
· Automated quotes and correspondence
· Forecast, order and contract generation
· Instant access to historical account summary
· Marketing encyclopedia and Internet communication
Today’s technology has reached a price/performance point where it is possible to acquire, consolidate, analyze, and manage the volumes of information that make this concept possible.
First of all, it must be understood that at its core, CRM is more than just a set of technologies: it is a process. This fact will be of significant importance to Information Technology (IT) professionals who will be asked to support CRM with information and applications. Furthermore, it is intended to be a repeatable process to ensure ongoing, continually improving, and consistent results. Simply stated, CRM comprises the acquisition and deployment of knowledge about customers to enable a company to sell more of their product or service more efficiently.
The role of enabling IT in all three of these areas–deriving knowledge, enabling intelligent customer channels, and capturing and analyzing feedback–cannot be over emphasized. IT professionals have a tremendous opportunity to become enablers of a customer-centric business strategy and to have an impact on the organization’s bottom line.
2.3.2.1 Evolution of CRM
In the past, customers were served by the corner store and door-to-door sales forces. The corner stores were small, intimate, and provided one-on-one service to their clientele. The door-to-door salesperson was the other face of the company and the personal relationship established by the salesperson was the key to success. This model provided, through personal interactions, an intimacy and knowledge about the customer and developed customer loyalty and trust. The age of mass marketing replaced the intimacy of a direct sales force in many organizations. Centralized large-scale production, wide-geographic distribution, and one-way communication on a grand scale created a tremendous variety of easily available, affordable goods. This put pressure on the relatively inefficient corner store and door-to-door models. Over time, the local corner store gave way to the supermarkets, malls, and megastores of today. While society has benefited from the cost efficiencies of these arrangements, something was lost in the bargain. That loss was the sense of connection customers had with the local storekeeper–personalized service.
Mass marketing was enabled through technological improvements in TV, radio, and the printed press, all of which created simple and powerful means to communicate a company’s message to millions of people at once. Marketing’s major goal was to push product and create brand recognition. The main measure of success for this business strategy was market share. The Internet allows for a customized consumer experience. But how does TapNet enhance this equation?
2.3.2.2 Target Marketing
In the mid 1980s, with the advances of technology and refinement in direct mail and telemarketing, another approach to communicate directly with the customer evolved. The use of Information System technology allowed the selection of specific (”targeted”) customers via mail or telephone. Unlike mass marketing, targeted marketing had the advantage of potentially receiving a direct response from a customer. The general strategy was to unearth potential customers by canvassing large numbers. Response rates became the central metric in gauging success, with response rates of two to three percent being considered successful. Market share still remained the primary measure of business success. Target marketing recognized the need to interact more with customers, albeit at a very superficial level, but did not go far enough. There was a lack of specific data as it relates to responses from the targeting means resorting to “averages” for response rates, customer purchases, and other data. Nonetheless, target marketing was a significant step in the evolution to today’s CRM in that it moved the relationship between producer and consumer one more step towards a personal interaction.
2.3.3 Customer Relationship Management
CRM is the next step in the evolution, and it moves us back towards developing an intimacy with today’s customers, using today’s tools, and maintaining our mass production and distribution systems. It recognizes that the equation that yields trust and loyalty from a customer has two variables. The first variable is information and analysis (knowledge): one has to know what the customer wants, needs, and values. The second variable is the need for interactivity and personal contact and the way in which the customer wants to be contacted. TapNet can better enhance this experience with more real-time communication, voice over IP, video over IP, transmission of more graphically, multimedia–oriented messages. The success of a customer-centric business strategy is measured not only by “share-of-market” but by “share-of-customer.”
In the following model, the four quadrants represent approaches that combine relative measures of knowledge about a customer and interactivity with that customer.
· The knowledge scale is a measure of what is known about the customer’s behavior and values. This is the informational and analytical part of equation.
· Interactivity is the measure of dialogue with a target customer, from one way communications at the low end to full interactivity at the upper end. This represents the personal contact and interaction part of the equation.
2.3.3.1 The Customer Relationship Management Cycle
Because the process is intended to be repeatable, it is only natural that a cycle is associated with the implementation of CRM. This cycle consists of an assessment phase, a planning phase, and an execution phase. In this cycle, assessment is made up of the knowledge acquisition portions of the process, planning comprises the creative part of the marketing process, while the execution phase maps to the customer interaction elements.
2.3.3.2 Execute
The execution phase of the cycle is where an organization puts all this knowledge to work, using all of the customer touch points available. Effective customer interaction, which has two dimensions, is the key here. The first dimension is the execution and management of marketing campaigns and customer treatment strategies through these interaction touch points. Customer touch points using TapNet and all the broadband capabilities (communication, multimedia, etc.) expand and conclude here.
2.3.3.3 Customer Relationship Management Summary
Businesses are reducing staff and at the same time searching for ways to arm employees with information to make better decisions and innovate.
The concept of “Customer Relationship Management” as a strategy reflects the business processes and technology enablers that can be combined to optimize revenue, profitability, and customer loyalty.
By implementing a CRM strategy, an organization can improve the business processes and technology solutions around selling, marketing and servicing functions across all customer touch-points (for example, Web, e-mail, phone, fax, in-person, and the touch points enabled by TapNet.
CRM applications address the following business functions:
· Sales Automation
· Marketing Automation
· Customer Service and Support
· Channel Management/partner Relationship Management
· Internal Helpdesk
The rapid acceptance and integration of the Internet has caused the most significant change in CRM applications – morphing of categories as CRM applications increasingly use Internet-based architectures. CRM and e-commerce are converging into a customer-centric solution, which allows organizations to interact with, sell to, and service customers through all channels.
2.3.3.4 Business Drivers
The major driver of growth in CRM is the Internet, which is enabling many new activities and business processes that were never before possible. For example: 1:1 marketing and “Mass-customization” of marketing programs, Web store-fronts with online purchase capabilities, and Web self-service for customers.
2.3.4 Distance Education
The Association Web Site will feature, as one of its most important sections, an online education area. In this part of the site Association members will be able to sign up for classes they need to improve their operations, learn about regulations and how to comply with them, and any other type of training that the member associations will request. We will have set up real-time as well as stored classes so that students can interact with others in the class who may be spread around the country, as well as the instructor who could be anywhere in the world. The stored classes will be made available for those who can not attend a regularly scheduled class but who would still like to take advantage of the learning opportunities we will offer. All real-time classes will be recorded and we will create special online training opportunities where appropriate.
2.3.4.1 What is the Process?
As Trade Associations join our site, we will work them to figure out what sort of training their members need and whether they would be able to do real-time or stored classes. People in some sorts of associations that are spread around the country (or the world, for that matter) may not have the ability to set a specific time when their members can be available for real-time training. I that case we would make more stored courses available. Regional associations, however, may be able to set aside specific times and dates and have enough members available where it would make real-time classes feasible.
Once we have the requests from the associations outlining their educational needs, we will contract out with universities, training institutes, and others to create the content. Real-time professors will need the infrastructure put in place to teach the classes, computers, cameras, electronic whiteboards, e-mail accounts, and whatever else is needed.
Association members will then be asked to sign up for classes on our website where they will be given login and password for their account. Their account will include demographic information as well as keep track of grades, professional certifications, classes taken, and other information. The association will have access to this information to keep track of how their members are progressing in any required training.
2.3.4.2 What do the Associations need to do?
When Trade Associations sign up with our service, we will offer them the opportunity to request specific training based on their special needs or to view whatever online content we currently offer. Any specialized training will require that they get a certain number of their members to sign up and, consequently, pay. Once a class has either been requested or picked from the available, it will be up to the Association to ensure that their members have the correct technology in place, computers, e-mail, web access, and internet streaming video cameras that they will need to participate. We will be available for technical advice and testing of their connections, but will not physically install anything.
The associations will also have to advertise their new partnership with our web site in their trade magazines, meetings, and newsletters. They will be paying for content beforehand, so it will be on them to get their members to actually sign up for it and “attend” classes.
2.3.4.3 What needs to be put in place?
We will need to make a large investment in equipment, software, and people to run it at the outset, but with correct resource management and planning there should not be a huge need for continued large capital expense once the initial infrastructure is in place.
The first things that will need to be ordered are servers with enough hard drive capacity, processing power, and bandwidth. These servers will have to handle the task of streaming many classes at one time to potentially dozens of students as well as single connections to one student at a time when they are view stored classes. Using IPv6’s ability to multicast will save bandwidth at our end and reduce network traffic.