Optimisation of primary processes
As the time to develop, produce and market a product has decreased, many industries have put enormous effort into making these processes more effective and efficient – especially development and production processes. Significant investment has been made in new technologies such as the use of new materials, smarter production machines, new and intelligent components, but definitely also automation and digital transformation through ERP systems.
In short: both hardware and software are being overhauled within the primary processes, in order to gain and maintain competitive advantage. This is great, obviously, but it does foster an internal focus. You’re so preoccupied with your product leadership and operational excellence that you almost forget the customer. And the customer is what it’s all about, right?
Implications of the shorter PLC on the commercial process
Since your pay-back period has become much shorter, you could make a few changes to the commercial process to get the same or even higher returns. You could make your product more expensive, you could sell more around it and you could sell your product more frequently. The first is often not possible but the second and third are real options. We’ll put the second option to one side for now – selling more around your product – because that’s the story of servitisation (see blog ….) No, selling more frequently is by far the most interesting.
In most boardrooms, the reflex response is to search for new marketing channels, i.e. new countries with new sales teams, agencies, more trade fairs and better-looking brochures, not to forget the website and other obvious matters. It’s all about pressing the same tried-and-tested buttons. Yet this is where things often start to go wrong. Because it’s not sufficiently clear to people that digital transformation is not just an internally oriented matter – in fact it must be oriented towards the outside world. If you’re wondering what I mean by this, please do read on.