Published on the 25/07/2013 | Written by Newsdesk

A new IDC study shows that only nine percent of leading companies have fully realised the importance of creating a customer-oriented culture and process workflows…

The recent IDC Manufacturing Insights report, sponsored by business software solutions vendor Epicor, has uncovered how important a customer-oriented strategy is for successful manufacturers. The report also discovered just how crucial enterprise resource planning (ERP) solutions are in helping all manufacturers improve their customer experience, from those that are only just starting out to those that already have a deep customer-oriented culture in place.

“Get customers inspired: how modern ERP can support greater customer experience” IDC whitepaper shows the results from more than 460 enterprises surveyed across 13 countries and multiple sectors including industrial machinery and equipment, high-tech and metal fabrication,.

“The research revealed that many manufacturers have an immature understanding of how a customer-oriented strategy can be implemented within an organisation,” said Pierfrancesco Manenti, head of IDC manufacturing insights research practice, EMEA.

He says that manufacturers need to understand this better in order to continue to stay competitive, especially in more mature or developed markets where relationships and service levels have now become crucial differentiators.

“We advise manufacturers with less than inspiring customer service to take a good look at how their systems and processes can be improved to better support a customer-oriented strategy,” he urges.

One of the main issues, Manenti explains, is that many companies continue to describe good customer experience in terms of products or service features and functions rather than in terms of their service level across their customer touch points. Businesses would do better if they focused on their ability to deliver the perfect order – right quality, quantity, location, and due date – and the range of aftermarket services supporting the initial product.

“An enhanced customer experience paves the way for customer loyalty and longer lasting relationships between supplier and purchasers, a win-win situation for all parties,” says Manenti.

The research highlighted how a modern, integrated ERP system will help manufacturers to improve their customers’ experiences by streamlining operational processes and connecting the back and front offices by offering through integrated CRM, warranty and aftermarket functionality.

John Hiraoka, executive vice president and chief marketing officer of Epicor, which sponsored the survey, says, “We have known for a long time that ERP software can help organisations significantly reduce costs and improve profitability, but the importance of this survey is that it confirms the critical role ERP plays in improving overall customer experience – one of the top business initiatives for manufacturers worldwide. It shows the clear link between successful manufacturers and their understanding and use of ERP as a strategic tool for delivering a superior customer experience.”

“He suggests that over the next three years, manufacturers will have to prioritise initiatives aimed at improving the customer experience as it evolves, or face the consequences. “Competing by lowering costs and increasing product functionality doesn’t hold in the long term. Modern businesses have to combine technology and processes with an embedded customer-oriented culture at all levels of the organisation to ensure they stay ahead of the shift, or they may simply not survive.”

Key statistics In companies with 100–1,000 employees, over 90% of respondents indicated that their ERP has limited, little or no contribution towards the delivery of a good customer experience. The opposite holds true for larger companies with more than 5000 employees.Conversely, better integration seems to be an enabler of an improved customer experience in larger companies where there is a higher instance of single ERP systems. In particular, nearly 75 percent of large manufacturers with 5000 employees or more indicated that their ERP is a vital platform for delivering a good customer experience as it connects the back and front office operations.The reality across the majority of small and midsized enterprises is that they possess numerous home-grown systems (nearly 40 percent for manufacturers with 100 –1000 employees) or no ERP at all. This creates a lack of timely information as data is stored in too many different IT systems that are loosely connected, making it difficult to influence customer satisfaction even at the most basic level.Only 9 percent of leading companies have fully realised the importance of creating a customer-oriented culture and process workflows to generate superior customer experience.Only 30 percent of respondents indicated continued relationships were influenced by meeting product expectations and only 6.5% based continued business with a supplier on their ability to support and deliver a product.Conversely, as sellers the focus is less about cost but more about delivering a good product and service to customers. Respondents are working hard to meet product/service features and function expectations (60 percent) and believe their customer will continue buying if they greatly deliver and support their product and service (29.8%). To download a full copy of the white paper, click here.