Adding the human touch to manufacturing


In the parking lot of a suburban shopping mall, a Bobcat skid-steer loader sits idle as a technician chats with the malls facilities manager. Yesterday, the machine sent an electronic message to the manufacturer that said, This part of my transmission is going bad.

Less than 24 hours later, the technician, having received the message by way of a smartphone app, and having already fixed the problem, now uses a tablet to show a range of new attachments for the manager to consider for purchase. The list is a custom catalog compiled from five years of the malls usage of Bobcat machinery. Knowing that the customers next big budget release is going to be in six months, this time spent together represents a big up-sell opportunity for the manufacturer, and some welcome personalized guidance for the customer.

Meanwhile, inside the mall, the proprietors of a small independent print and copy shop are paying careful attention to a YouTube video that explains how to install and use their new 3D printer.

They would never have been able to afford its $20,000 price tag, but the manufacturer never actually sold it to them. Instead, the manufacturer retains ownership, and the shop owners pay for its use as-a-service. The owners of the print shop are thrilled that their supplier made the machine available, and that it suggested the technology in the first place, based on search data it had compiled from people nearby who had been searching for a store that provided such a service. The presence of the printer promises to bring more foot traffic and online orders to the shop.

Although these stories sound like they come from a marketing or commerce playbook, this is actually from todays world of manufacturing. Manufacturers can more clearly and accurately than ever before understand a customers problems, provide relevant solutions, and deliver intelligent engagement, all while generating more revenue. The human touch side of hard goods has arrived.

Manufacturing is by its nature, big, heavy, and difficult to alter with the stroke of a pen. Some of this is due to tradition, and some to management resistance. Other obstacles might include legislation or existing contractual relationships. Regardless, the industry is changing. The Bobcat and print shop examples above are just two situations in which manufacturers became directly involved in the customer journey. It is a concept we call”business-model innovation.

Looking at Business Model Innovation

The core of business model innovation is the willingness for a company to bundle its products and services to create B2B, B2C, and B2B2C storefronts that generate revenues through service, not just product sales.

In the Bobcat case above, the field technician was able to access the catalog and purchase an item on the fly, but the innovative nature of business model innovation goes well beyond that one replacement part. The data generated through this transaction can be combined with information from prior interactions. This includes Web page browsing, and unstructured data like feedback, comments, and questions, which together set the stage for a new style of proactive field service management maintained directly by the manufacturer, and loaded with up-sell, cross sell, and targeting opportunities.

With the print shop in the mall, the innovative service model opens up a new market. Entrepreneurs who, in a previous era, would have been considered too small for a manufacturer to deal with, suddenly fit into a revised and ongoing service-based model.

Data is key to innovation. Data offers 360-degree visibility into customers and prospects. It provides the capacity for companies to translate their traditional CRM into marketing and commercial payback by using sales and service data, as well as back-end data to create dynamic, real-time B2B and B2B2C storefronts. Data, both structured and unstructured, illuminates different customer engagement touchpoints, and reveals customer:

  • Purchase intent
  • Purchase triggers
  • Search criteria and search terms
  • Previously viewed content
  • Usage data on previously purchased products
  • Catalog viewing history

This information can be personalized for use at every point that a person might connect, including a customer service phone call, or during the creation and deployment of an outbound email or social media marketing campaign.

Business model innovation consolidates enterprise-wide intelligence that would otherwise remain hidden or unnoticed. It helps manufacturers get into the head of the customer, to see what he or she cares about. This helps move a relationship into lockstep with a customers concerns, addressing them both reactively and pro-actively.

As a philosophy and a practice, business model innovation stands as a unique monetization option for manufacturers, by packaging and delivering convenience. It delivers the human touch straight from the factory.

Download more information about SAP Solutions for Manufacturers.



Dean Afzal
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February 10, 2016
Dean Afzal

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