Lean Principles – Customer value

Written December 30th, 2007 by
Categories: CEO's Blog
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b2b2dot0 embraces the five major
imperatives of the Lean methodology:

  1. Define customer value
    Define not only what our customers value, but what their
    customers value as well.

  2. Create pullEstablish
    a demand for our value as soon as possible.  B2b2dot0 will always
    strive to be “fulfilling a demand” as opposed to “pushing
    product”.

  3. Identify the value stream
    Work backwards from the day the customer is receiving value from
    our service and highlight the specific activities and features that
    contribute to that value. We want to do more of those.  The flip
    side is to highlight those that aren’t (waste)…see step 5.

  4. Setup continuous flow
    Strive to shorten the time from identifying a customer’s value to
    delivering it to them. Things that prevent us from delivering value
    instantly are probably sources of waste in our process…see step 5.

  5. Seek perfection/eliminate waste
    Anything that gets in the way of delivering value to our
    customers is deemed waste. We’re constantly in pursuit of
    identifying, prioritizing and removing these obstacles.

Defining customer value has been fairly
easy for us.  We’ve been engaged in this business area since 1999.
Over the years we’ve learned that there are three immutable sources
of value for our customers and one that is highly variable.

Immutable value #1 – Leverage
their investment in SAP… which means tight integration.  That’s
where all the business data and logic exists.  Our customers have
invested heavily in making sure that they have a single place to go
to to understand which products they sell, who can buy them and for
how much, if they are available, how and where they are shipped to,
if they’ve been paid for, etc.  They don’t want to spend the energy
managing that information in multiple places and, even worse, risk
the loss of its integrity.

Immutable value #2 – Enhance
customer service… which means bringing SAP to the web so that our
customer’s customers become more self-sufficient.  There is no sense
for an end-customer to send faxes, emails or make phone calls to
customer service if they can navigate 24×7 to a web site that can
satisfy their needs.  Of course a derived value of this self service
capability is to reduce the burden on the customer support
organization.

Immutable value #3 – A restful
night’s sleep…which means reliable, easy to use technology and
knowledgeable and responsive support.  This not only pertains to
daily operations but to responding to the evolving needs of our
clients. 

Variable value – These vary by
industry, customer and role. 

The building material customers only
seem to want to put invoices on the web.  They say that no one wants
to buy rocks over the web but that web invoices reduce days
outstanding on accounts receivable enough to pay for the website. 

Other clients are using the web to add
additional value to their tier 1 EDI customers by offering
transactions and data that aren’t easily covered by EDI.  For
instance, supporting the quotation process, inquiring about
availability, and retrieving additional documentation like Material
Safety Data Sheets or Product Brochures. 

The majority of clients use the website
to support their tier 3 customers and no longer permit orders via
fax, email or  phone.  This allows their customer service
organization to focus their efforts on their more strategic
customers.