Health Management Technology, Essay Example

Retailing Principles – Exel

I was the Operations Manager at Exel for four years.  Being responsible for overseeing all facets of order fulfillment and logistics gave me the opportunity to work across departmental lines.  While at Exel, I developed the RAD program which identified and addressed the three core retailing concepts that drove our retail sales.  This program helped to differentiate us from our competitors through our promise to be Responsive to our customers’ needs, Accurate in our order fulfillment, and Dependable with on-time delivery.  In implementing the RAD program, I also shifted the old management and training paradigms into a single, new change management model.  This model was effective in improving our overall efficiency and ultimately improving retail sales.

Concrete Experience

Exel was a Las Vegas-based company that specialized in the distribution of generic as well as custom-made electronic components. A customer could order an off-the-shelf capacitor or transformer as well as a custom-assembled analog multi-switch module. Every customer ordered components specific not only to their functional needs, but also their explicit quantity or timeframe needs. Order fulfillment was more complex than many distributors that simply pull “two boxes of the red ones” off the shelf and put them on a delivery truck.  We not only inventoried and shipped individual components, but also used those components to fabricate functional parts for customers.

My primary job at Exel was to ensure that any component or functional part requested by a customer could be available or fabricated within the timeframe needed and that the subsequent order was actually fulfilled correctly.  To help me frame my approach in the Exel setting, I identified three core retail components that were essential for our continued growth and formed them into the acronym “RAD” which stood for Responsive, Accurate and Dependable.  While developing the RAD concept, I realized that there was a significant “disconnect” between the various departments at Exel.  To better address the RAD concepts, I transitioned the company away from the traditional management and training paradigm and into a new change management model.

This model treated the company in a more holistic way, as if the company itself were a multi-functional organism where every part was integral and interconnected.  By unifying the way that all departments functioned, I was able to improve communication, better identify and overcome challenges, increase capacity and ultimately increase customer satisfaction – which improved sales.

In a company like Exel, responsiveness to customer needs was central to our success.  I realized that we needed to thoroughly understand what our customers needed and why they needed it.  The change management model improved the relationship between our sales reps and our engineers which gave the reps a better ability to problem-solve and find solutions for their customers.

In the electronic world, accuracy is everything. Tolerance in electronic components is often measured by a decimal point, followed by several 0’s before a whole number appears. Getting “close” to a specification is unacceptable. It is easy to pick and ship a part manufactured by someone else.  It is another thing to fabricate a functional part with specific electronic, durability, sixe, and sometimes even weight specifications.  The change management system brought assemblers together with engineers, sales reps and warehouse people to make sure that functional parts were completed in the most accurate manner possible.

Government contracts are great. They often run over-budget and late with little consequence. In the private sector this is not the case.  Many of Exel’s customers fabricated machinery, equipment or aerospace components for their clients.  The failure of Exel to deliver promised orders on time was not an inconvenience for our customers.  It was disastrous.  We promised our customers that we would not only meet their needs in an accurate way, but we would deliver on time.  The continued relationship with our customers was largely based on our dependability.

I found that working within a change management system made Exel run more efficiently with a notable increase in order accuracy. I set up the basic framework and discovered that the model was an excellent fit for achieving the goals I had set for the RAD program.  Higher responsiveness, accuracy and dependability resulted in higher sales volume.  All the retailing and marketing principles are useless unless the company can produce exactly what the customer wants when the customer wants it.

Reflective Observation

When I first went to work for Exel, I discovered that many of the departments seemed disjointed.  Each tended to function autonomously under the leadership of their respective supervisors and managers.  I observed sales reps making promises to customers that placed undue stress on the operational side of the business.  I saw new initiatives rolled out by a department head without much consideration as to the impact the initiative would have on the operational efficiency of other departments.

When I decided that something needed to change in order to better satisfy customers and grow sales, I began thinking about the fundamentals of our business.  There were certainly core business and marketing strategies that are common to all businesses. I felt however, that it was important to refine some of those principles into a context that would most benefit Exel. Any textbook on retailing principles for example, would surely have a section on “customer satisfaction.”  The question I had to consider was; “What does that mean for Exel?”

Because the overwhelming majority of our orders were actually special orders, I realized that responsiveness to customers’ specific needs was first on the list.  As I explored this issue further, I looked for areas where Exel was struggling on a systematic basis. The goals I set for achieving better responsiveness were based on these findings.  The process of analyzing our responsiveness taught me to dig deeper into understanding our customers than I once might have thought necessary.

When I started working on the second issue (accuracy), I learned that I had a lot to learn.  My last job had also been with a distribution center, but it was a “pick and ship” operation.  The only accuracy involved was ensuring that everything on a given order got shipped.  At Exel, I had to learn about building functional parts as well as storing and shipping them.  Even though I did not need to be an engineer or fabrication expert, I learned that it was important for me to understand the fundamentals of the products we were selling to our customers.

The final corner of the RAD triangle was dependability. It was at this point that I realized that a new model for overall efficiency at Exel was needed. A sales rep would work with an engineer for example, to blueprint a new functional part for a customer. Once the part was designed, the rep would submit the order to Operations who would check inventory and order any needed parts.  Once the parts came in, the engineer would show the fabrication supervisor what needed to be done.  The fabrication supervisor would get with the warehouse guy to pull the parts, and then train the fabricators on how to build the item.  Once the parts were built, the shipping department would figure out how to ship the items safely.  The process was very disjointed.

I realized that since every order was something new there could be no standard, assembly line-type process to ensure that we could dependably sell, fabricate and ship orders.  It was the fact that we had to change what we did with every order that led me to embrace the change management model.  In this model, everyone potentially involved in a given order was involved in the order from start to finish.  We were then better able to identify potential bottlenecks or other problems long before they were right in front of us.  This approach enabled Exel to satisfy our customers better by providing them with very dependable order fulfillment.

Abstract Conceptualization

In recent decades, technological advances in communication and transportation have changed the way many companies do business.  Everything seems to happen much faster these days and that phenomenon has reset the pace at which business transactions are made.  According to Thatte, Muhammed, and Agrawal (2008), the compression of sales, ordering, manufacturing and shipping times is for many companies, as important as price or product quality.  Customers need exactly what they need, and they typically need it now.

Because many companies use a LEAN, Just-in-time manufacturing model, it is vital that sub-suppliers be able to be responsive to customer needs in terms of timeframes as well as product characteristics.  The study showed that satisfying customers’ time-to market needs was paramount in satisfying their desire for supplier responsiveness and building long-term relationships.

The next step after product and time-to-market responsiveness is order accuracy.  There is little value in being able to provide or fabricate a given order and deliver it on time if the product does not meet the customer’s expectations.  According to Walter (2010), the integration of point-of-sale with order fulfillment and distribution is essential for improving order accuracy. The article pointed to the “long-run equilibrium between point-of-sale information andretail orders” as being the key to order accuracy and ultimately, customer satisfaction.  Ultimately, it is the communication (or lack thereof) between all components of sales and order fulfillment that drives order accuracy metrics.

Companies like Exel specialize in business-to-business (B2B) transactions.  Since marketing strategies are founded on the relationship between the customer and the brand, it is essential to understand the intricacies of B2B relationships and how they differ from business-to-consumer relationships.  In his article, Hollyoake (2009), describes four “pillars” of B2B relationships as being communication, interdependence, integrity, and trust.Hollyuoake contends that the relationship between a business and its supplier is the differentiator that makes the most difference.

The fourth “pillar” in Hollyoake’s model is trust. It is in this area where dependability comes in.  A company like Exel might have great communication and exceptional corporate integrity, but if it cannot be trusted to fulfill orders in a dependable manner, those issues become moot.  If orders are not delivered accurately and within the promised timeframe, trust is lost, integrity questioned, and interdependence weakened.

Employing a change management model can help a company be responsive to customer needs, accurate in order fulfillment, and dependable in fulfilling its promises.  More and more companies are recognizing the importance of pro-active change within the context of today’s market and economy.  Some progressive organizations have abandoned their training departments altogether in favor of adopting a new strategy known as “change management.”  Change management approaches continuous improvement and productivity from a more holistic perspective than traditional training departments.  In his article, Parsons (1991) describes the concept of change management in terms of shifting corporate and institutional culture to embrace holistic approaches to attaining goals.  The article defines change management as an organized modality to managing growth and improvement.

In another article, HMT (2010) recounts the experience of Gwinnett Health Systems in transitioning from a traditional management and training model to a change management system.  The article cites Assistant VP Daugherty as commenting on the fact that all relevant information is gathered and shared early on in the process using the change management strategy. Collaboration between every person or department involved in a project of any kind can mitigate potential problems and keep things from “slipping through the cracks.”

Active Experimentation

My experience with implementing a change management system at Exel has helped me to see how interdependent all departments within an organization truly are.  In my previous job, each department did whatever it was they did without much consideration for the impact it might have on other departments.  Embracing change management made me see my company from a more holistic perspective.  This perspective helped me not only at Exel, but in my current job as well.

I currently work for OfficeMax.  This company continues to employ a more traditional system of managing sales, order fulfillment and training.  Because the corporation is so large, it is not really feasible for me to completely change the core policies and procedures specified by the company.  It is however possible for me to adopt a personal and professional attitude that is more consistent with the change management concepts that I learned while at Exel.

My current job at OfficeMax puts me in a position of leadership which gives me a certain degree of flexibility in how I want to approach any given problem or challenge.  Our company recently launched a new initiative to replace cardboard boxes with reusable shipping bins.  While the program had already been implemented at other branches, I was tasked with figuring out how best to launch this initiative at the Las Vegas facility.

There were many approaches I could have taken.  I could have met individually with other department heads, asked for their input, and then developed an implementation plan on my own.  I could also have formed a project team with other managers and we could have brainstormed the challenge together in a series of meetings.  Given my experience at Exel, I decided to employ the spirit of change management and ultimately chose to facilitate a kaizen event to address the issue.

For this event I selected a wide variety of personnel from all the departments that would ultimately have a hand in delivering this new service to our customers.  I wanted to have collaboration between diverse perspectives to ensure that we identified any and all potential issues that might be associated with the new program.  Instead of recruiting just members of the management team for this event, I included a forklift operator, a delivery driver, a sales rep, a person from accounting, an operations manager from another branch and several other managers and supervisors from our own location.

My experience at Exel taught me about the value of input from employees who actually execute policies and procedures as well as the “educated” input from the managers who write them.  I learned that by looking at the organization as a whole (and encouraging this attitude in others) I could not only get better insight into how to modify the necessary procedures, but would also get a better “buy-in” from those who would end up executing it.  Applying the concept of change management that I learned at Exel ended up being a very successful approach to solving the challenge I faced at OfficeMax.

References

(Hmt 2010 Change management: Buzz Lightyear style)Hmt (2010). Change management: Buzz Lightyear style. Health Management Technology, 31(3), 14-18. Retrieved from http://web.ebscohost.com.ezproxy.apollolibrary.com/ehost/pdfviewer/pdfviewer?vid=29&hid=14&sid=64290236-7eec-4be7-8ae4-ae70ef501614%40sessionmgr12

(Hollyoake M 2009 four pillars: Developing a ‘bonded’ business-to-business experience)Hollyoake, M. (2009). The four pillars: Developing a ‘bonded’ business-to-business experience. Journal of Database Marketing and Customer Strategy Management, 16(12), 132-158. DOI: 10.1057/dbm.2009.14

(Parsons M 1991 Enhancing teaching-learning environments: A change management strategy)Parsons, M. (1991). Enhancing teaching-learning environments: A change management strategy (ED 333926). Retrieved from http://www.eric.ed.gov/ERICDocs/data/ericdocs2sql/content_storage_01/0000019b/80/23/0e/08.pdf

(Thatte S Muhammed S Agrawal V 2008 Effect of information sharing and supplier network responsiveness on time-to-market capability of a firm)Thatte, S., Muhammed, S., & Agrawal, V. (2008). Effect of information sharing and supplier network responsiveness on time-to-market capability of a firm. Review of Business Research, 8(2), 118-131. Retrieved from http://web.ebscohost.com.ezproxy.apollolibrary.com/ehost/pdfviewer/pdfviewer?vid=8&hid=106&sid=64290236-7eec-4be7-8ae4-ae70ef501614%40sessionmgr12

(Walter M 2010 Logistics model improves retail accuracy)Walter, M. (2010). Logistics model improves retail accuracy. Industrial Engineer, 42(1), 10. Retrieved from http://web.ebscohost.com.ezproxy.apollolibrary.com/ehost/pdfviewer/pdfviewer?vid=17&hid=14&sid=64290236-7eec-4be7-8ae4-ae70ef501614%40sessionmgr12