For manufacturers, the secret to success is continual and sustainable improvement.
Shave a few seconds off an operation to reduce production time. Eliminate a quality escape and reduce waste. A single kaizen session can increase efficiency across operations. Improvement is crucial — the difference between growth and increased profit or slowly sliding into failure and oblivion.
Process improvement is critical, but too often it comes at the expense of supporting and optimizing everything else that goes into a successful business. A great product and cutting-edge operations aren’t going to generate revenue if you are struggling with marketing or sales. A gap in the supply chain is going to shut down product just as fast as a worn-down machine. A front office in disarray can be as disastrous as a line that goes down.
The Gaps in Business Operations
The fact is many manufacturers are excellent at production. The engineers know how to design and build, and the factory floor is filled with workers using the latest tools and technology to construct your product. However, this is only one part of the manufacturing value stream.
Successful production means hiring the best possible talent and workers and providing them the tools and resources they need to succeed. The same applies to other business operations.
What’s Missing in Your Business Strategy?
Trying to apply the expertise and skill in manufacturing to other business processes will lead to problems, inefficiencies and lost opportunities. You also need experts working in your office.
Many manufacturing companies don’t have a writer on staff. They haven’t invested enough in marketing. They aren’t supporting sales, don’t fully grasp how important strategies like sales enablement can be, and are letting other business processes languish.
For example, the CRM (Customer Relationship Management) system may be old and holding back your sales team. The purchasing team may understand the market for materials, but not critical supplies like labels or packaging. This can lead to overpaying for supplies, or waste, or even lost customers when shipments are delayed, damaged or lost in transit.
Many manufacturers attempt to double up on responsibilities to cover the gap. They quickly find out that an engineer isn’t a writer and a floor manager isn’t a sales leader.
Luckily, the solution is closer than you might think.
Managed Services for Manufacturing
With managed services, a company outsources a business function to another company. The company that provides the outsourced resources is known as a provider.
How Managed Services Work for Manufacturers
Typically with managed services, the business isn’t purchasing a single service from the provider, but a business outcome. For example, with IT managed services, the business determines a technology service state (the business outcome) and the provider delivers the services necessary to meet that state. The manufacturer may require maximum uptime on computer systems. After evaluating the technology, the provider will update systems as needed, then provide maintenance, make recommendations for improvement, and manage issues as they occur.
With managed services, rather than purchasing individual services to cover business gaps, the manufacturer is directly addressing them and tying the services to business goals.
Solving Manufacturing Challenges with Managed Services
While IT is an area that many businesses, including manufacturers, feel comfortable leveraging managed services for, there are other areas that can benefit.
Critical Supplies and the Supply Chain
Purchasing supplies and buying materials are critical for manufacturing. Manufacturers will build relationships and develop a supply chain for materials to keep production moving. Data and strategy shape purchasing, with just-in-time delivery and a forward view of upcoming inventory needs.
Other critical supplies, including RFID and labels, packaging, or even front office supplies, are equally important but often handled as an afterthought rather than a priority. The result is overbuying, overpaying or missing supplies. Inconsistency or poor quality in purchased supplies can create inefficiencies that slow production.
Leveraging the existing relationships and deep experience of a provider to manage these critical supplies across the supply network can reduce friction across the supply chain. In addition, the provider can often reduce overall cost and deliver additional benefits like reduced on-hand inventory and better insight into expenses. The strategy offered by the provider can let the manufacturer focus on production and keep the business operating.
Technology and MarTech
Manufacturers prioritize production systems over any other software needs, and rightly so. A production system will often show a quick ROI and provide a competitive boost to the company. By focusing on production alone, other business systems can quickly lag, dragging down efficiency and productivity for the company.
Managed services and your provider can bring outside expertise to your technology stack and MarTech to identify needs and requirements and help manage any implementation and maintenance of the new systems. Integration is another area that a provider can handle, helping to optimize the new systems for the manufacturer. They can keep the tech stack current for the business, which can lead to overall cost savings and greater efficiency.
Because of the complexity and requirements of manufacturing, many companies find it useful to leverage a provider for custom software solutions, helping to better connect the production and front office systems or to address a specific need. The custom system can be rolled into the overall cost of the managed services and help ensure a successful project.
Sales and Marketing
When a need in sales and marketing comes up, manufacturers’ first thought is to hire or shift resources to cover the need. Today, when customers are looking at a manufacturer not just for a product but value as well, shifting resources can disrupt your customer value proposition.
Sales is changing too rapidly, and change is shaping the market too quickly, for a new employee or a stopgap resource to make the impact the company needs. Managed services can help by providing flexible resources and expertise as needed to keep the business competitive and deliver the support the sales and marketing team needs when they need it. Sales enablement, digital marketing, web design and more are all possible with managed services.
With managed services, you and your team have access to best-in-class experts. You have the resources to execute on larger projects. Rather than approaching new prospects or the market with dated and inferior messaging or tactics, you’re working with the most up-to-date material and tactics that can make a difference.
Best of all, you aren’t working with expensive freelance resources or supporting a massive internal team. You’re giving your employees the support they need with scalable resources. You can better tailor the spend and expense to your need to keep costs low and deliver a rapid ROI.
Managed Services Solutions for Manufacturing
We’ve covered only a few of the areas in which a manufacturer can leverage a managed services provider to benefit the business.
Evaluate your current operations. Look for areas where expenses are elevated, frustration among employees is high, or inefficiency gives managers a headache. These are areas that may benefit from managed services.
Getting Started with Managed Services
Don’t be scared to reach out to a provider for an evaluation. They can conduct an in-depth assessment of your current operations to identify areas and opportunities for improvement. After the assessment, they will work with you to set goals, as well as determine the KPIs (Key Performance Indicators) and metrics to evaluate and optimize the program.
For many manufacturers, managed services are not just a program for cutting costs but increasing efficiency and delivering their goals. It allows the company to operate flexibly and provides resilience against market fluctuations. The manufacturer can focus on what they do best — production — while delivering the competitive advantage the company needs in a changing marketplace.
If you’d like to learn more, then contact GO2 Partners today and speak to our experts about your business and needs. We’re here to help.
