In today’s customer first world, there are many things manufacturing and distribution firms need to do. From new pathways to sales to ever-changing customer expectations and demands to the persistent threat coming from Amazon, those companies who can adapt and evolve will be best positioned for success in 2018 and beyond. This said, with the right planning, execution, and technology, organizations can gain a competitive edge—without sacrificing profit margins.
The New, Customer-Focused Manufacturing and Distribution Environment
According to a recent Aberdeen Research survey, two of the most common issues that manufacturing and distribution companies expected to face this year were also two of the most persistent: finding a way to reduce costs (37%), and managing growth expectations (31%). However, a few other pressures are beginning to take form: changing customer needs, increased competition, and a need for timely decision making all have begun to creep up on the standard concerns, appearing at 23, 21, and 19 percent, respectively.
What Leaders Do Differently
Aberdeen took the research further, comparing companies’ efforts and execution to determine which of the respondents were “leaders” and which were “followers.” In this, Aberdeen found that among the manufacturing and distribution companies, leaders had a significant edge in streamlining and accelerating processes (50%), collaborating (38%), and putting increased focus on customers (38%).
Notably, all three of these differentiators seem to be driven by the fourth competitive advantage among leaders: modernizing technology infrastructure and applications. Aberdeen analyst Nick Castellina noted:
“[…] for many wholesalers and distributors, new delivery methods, interoperability, and efficiency have proven difficult to implement. Therefore, another top strategy for leaders is the modernization of the technology used to support operations.”
So, where are companies turning as they look to drive collaboration, accelerate processes, and focus on customers? Modern, integrated, and expandable ERP.
How ERP Is Driving Positive Change at Manufacturing and Distribution Firms
As companies look to make the leap from follower to leader, many are turning to ERP as their first and biggest step in that direction. Castellina notes, “Enterprise Resource Planning (ERP) is the foundation for this change, but top performers truly differentiate themselves in the actual emerging capabilities that ERP delivers for their organization.”
Since the entire purpose of manufacturing and distribution is to connect consumers and products, the emerging class of leaders is embracing an ERP strategy that is able to help them get products to consumers more efficiently than ever—creating a “Customer Success Portal,” so to speak.
Aberdeen research found that leaders are three times more likely to integrate CRM with ERP, implement e-commerce and customer self-service portals, and embed business intelligence tools into their ERP, noting, “combined with better access to customer information, top performers utilize the data, contained within ERP, to make better decisions and to become more agile.”
How Manufacturing and Distribution Firms Are Getting Ahead with Modern ERP
By prioritizing technologies and capabilities that lead to a more collaborative, informed, and analytical organization, top performing wholesalers and distributors have driven significant improvements, in performance, across a variety of metrics. Whether this improvement is in the form of faster decision making or better customer service, leaders are finding new ways to satisfy and delight customers—due in part to modern technology.
We welcome you to learn more by downloading the entire Aberdeen Report, ERP in Wholesale and Distribution: Improving Customer Interactions at a Lower Cost.
If you’re ready to take the next step in moving your business forward, we would like to introduce you to Acumatica. Built in the cloud and designed for the manufacturing and distribution industry, Acumatica can help you do more, do it faster, and do so with the customer in mind.
Sold only through a network of trusted consulting and implementation partners like CAL Business Solutions, Acumatica has helped thousands of distribution firms to forge ahead. Learn more about our work with them here, and contact us for more information.